Plan for $330M energy storage project in Healy moves forward

A $330 million energy storage project in Healy that could support renewables and help hold down electricity prices along the Alaska Railbelt moved closer to reality this month.

The federal Department of Energy said that it has selected Westinghouse Electric Co. and eight other “long-duration energy storage” projects in the U.S. to potentially receive grants to help kickstart projects.

Such projects can deliver more than 10 hours of electricity at a time, helping smooth out energy from fluctuating solar and wind installations.

The selection opens up the possibility of Westinghouse receiving $50 million to launch a first phase.

Westinghouse has proposed constructing the energy storage facility in Healy south of Fairbanks, at the site of a coal-fired power plant unit that’s set to be retired at the end of next year, officials familiar with the project said. The facility would rely on a large number of heated concrete blocks to store releasable energy, they said.

The project will use a heat pump to draw electricity from the power grid and convert the electricity into heat stored in the inexpensive concrete blocks, the Energy Department said in a statement. The stored energy is converted back into electricity using a heat engine.

A rendering of the proposal that Westinghouse posted on X, formerly Twitter, shows two long facilities housing the concrete blocks. It shows electrical lines tying into the system, among other project installations.

The Westinghouse project could provide enough stored energy to power about 2,000 homes for a month, said Meadow Bailey, a spokesperson with the Golden Valley Electric Association in Fairbanks.

The project is in an early stage, but the utility is optimistic that it will work as planned, she said. The utility needs to add renewable power to its system and the stored energy can support that renewable power, she said.

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“This acts like a large battery, but it uses pumped thermal energy instead of battery technology,” she said.

The project comes as utilities along the Railbelt from Fairbanks to Homer are looking for more renewable sources of power, and stored energy to support the renewables, to replace a looming shortage of Cook Inlet gas.

Bailey said Westinghouse’s application was created with participation from Golden Valley Electric.

She said the first phase focuses “on demonstrating the viability at utility-sized scale. Subsequent stages are focused on engineering, design and ultimately construction.”

The full project, if tests show that power can be provided at a large scale, is expected to be built by 2028, she said.

The project is one of nine selected across the U.S. to enter a period of award negotiations that could take a year, prior to a project entering a first phase, Department of Energy officials said in a call with reporters Monday.

The selections are part of a $350 million Energy Department program announced last year to support demonstration projects for long-duration energy storage technology, they said. The money is part of the 2021 bipartisan Infrastructure Law.

Westinghouse said in a statement to reporters that the project would support future wind power projects at Golden Valley Electric.

Golden Valley is currently looking to add 150 megawatts of wind power to its system, Bailey said. It plans to select an independent power producer that would build a new wind project near Fairbanks. The utility would buy the wind power in part to lower electricity prices for its ratepayers.

The energy storage system would be the largest, single-installation project of its kind in the U.S., providing 1.2 gigawatt-hours of power, Pennsylvania-based Westinghouse said in its statement.

Officials with Westinghouse did not respond to a request for comment.

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Golden Valley Electric has not committed to investing in the project, Bailey said. It is interested in pursuing a power purchase agreement with Westinghouse if the project works as intended, she said.

The project will reduce carbon emissions, expand the benefits of wind power, and demonstrate the value of heat-dependent energy storage in a cold climate, the Department of Energy said.

Gwen Holdmann, senior researcher at the Alaska Center for Energy and Power, said the system is a “potential game-changer” in Alaska because it’s significantly larger than any energy storage system on the Railbelt grid.

She said the materials proposed for the project are environmentally friendly, so it has benefits over other energy storage projects made with materials such as lithium.

“It’s enabling meaningful, long-term duration storage in ways that don’t require lithium or cadmium, these (materials) that need to be mined and create long-term disposal issues,” she said. “This is simple, locally sourced material, and that’s exciting as a broader strategy for energy storage in the future.”

Gov. Mike Dunleavy said the project will help Alaska better utilize its renewable resources.

“Having an effective and affordable way to store energy has been the choke point for renewable energy technology,” Dunleavy said.

John Burns, president of Golden Valley Electric, said the cooperative is focused on providing members with low-cost power, while reducing emissions.

“We are excited about the potential of long-duration energy storage and the role it can play in integrating renewable energy not only in Interior Alaska, but the rest of the Railbelt electric system which serves over 80% of Alaska’s population,” he said in the Westinghouse statement.

Houston Contracting Co. would lead construction of the project along with a subsidiary of Arctic Slope Regional Corp., an Alaska Native corporation, the Energy Department said.