LIPA plans for large battery storage facilities experiencing setbacks

LIPA’s plan to deploy hundreds of megawatts of battery storage units on Long Island has been beset by local moratoriums on building the units, while the largest proposed project in Brookhaven has pulled out, officials said.

LIPA had awarded about 329 megawatts of battery storage projects to outside developers following a 2021 request for proposals, but the process has been affected by towns that won’t approve the large facilities as well as market pressures, officials said. 

Two big projects awarded to developer Anbaric for the LIPA Brookhaven substation have since been withdrawn, LIPA said. The projects represented 150 megawatts of battery storage and had been the largest block planned by LIPA. The utility didn’t say why the developer pulled out. Anbaric officials declined comment. 

Meanwhile, Brookhaven Supervisor Dan Panico in a statement last week said the town board will not consider a needed change of zone request for a project planned for Mount Sinai, after considerable opposition from area residents. Panico cited overwhelming requests from residents and “significant confusion” about state climate goals and battery's role in that plan.

At a meeting of LIPA’s trustees last month, Paul Napoli, PSEG Long Island’s vice president for power markets, noted that a broader LIPA plan to have the barn-size battery facilities operating by the end of 2025 now looks more likely to happen by the end of 2028.

Battery storage units are a vital leg of the state's, and LIPA’s, plan to replace dozens of smaller power generators around the state and Long Island with greener energy sources. The batteries, which would occupy acres of property, some at existing LIPA substations or National Grid power sites, would store power from wind energy or solar facilities, and discharge it when those facilities are not producing.

Napoli said that in addition to moratoriums on battery development implemented by towns such as Babylon, the battery storage plans were also beset by supply-chain issues “creeping up.” Developers who bid on the LIPA procurement in 2021 “started raising their prices almost immediately,” he said. That helped LIPA narrow a list of 78 different proposals to just five: two in Brookhaven Town, one on Kings Highway in Hauppauge, one in West Babylon and one at Shoreham. 

Vendors and LIPA also had to work out whether the utility would reap the financial benefit of federal tax breaks provided for the facilities under the Biden Administration’s Inflation Reduction Act. More recently, Napoli said, new restrictions eyed for Chinese-made nonelectric vehicle batteries, which are expected to see tariffs hiked from 7.5% to 25% in 2026, could add a new expense to the projects. PSEG is conferring with developer KCE about potential impacts, Napoli said.

Moratoriums, Napoli said, remain a delay factor as other towns have issued or mulled them after they were initially enacted by Southampton, Southold, Oyster Bay and Huntington. The moratoriums, he noted. were the result of local concerns following “several fires in New York State with battery facilities.”

One fire at a LIPA-contracted facility in East Hampton has shut down the $55 million, 5-megawatt facility, located in a neighborhood off Cove Hollow Road, for more than a year. It’s expected to be back in service this summer, developers NextEra and National Grid have said.

PSEG is expected to bring a proposed contract for a 79-megawatt Kings Park facility to the LIPA board in June. The board could see contracts for a 50-megawatt Shoreham facility and a separate 50-megawtt Babylon facility next year, but none is expected to be built before 2028, Napoli said.

Most of the projects are slated for Long Island most likely won’t operate under direct contract by LIPA, Newsday has reported. They could operate as so-called merchant facilities and sell their services to the grid. New York State has already approved a non-LIPA contracted facility for Holtsville, one opposed by residential groups in the region.

The Mount Sinai facility, proposed by developer New Leaf Energy, was such a merchant facility. 

It now has greater challenges to surmount if it is go forward given the position taken by Panico and Councilwoman Jane Bonner, who said the town is “going to uphold the integrity of our zoning for our residents in this case” and not allow a change to light industrial for batteries.

Carissa Fabian, a resident who lives near the proposed site, said, “I appreciate what they’ve done in killing it at the town level,” given the site’s proximity to homes and an elementary school. Sarah Anker, a former Suffolk legislator who is running for the State Senate, also opposed the site and said that while she is a “strong proponent of renewable energy,” the batteries have to be sited properly.

“If they are going to put these units in residential areas, they have to guarantee the safety of the residents,” Anker said. “We’re just not quite there yet. There have already been three fires across the state, including one in East Hampton. We just need to make sure this type of technology is safe. We need energy storage units. We need to be able to store this green energy, but we need to do it safely.”

— With Carl MacGowan

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.