By CorpGov Editorial Staff
As global air conditioning demand is forecast to triple by 2050 and power demand in general is forecast to increase by 2.5x to meet net zero goals[1], power grids are already facing bottlenecks and struggling to keep up. Adding generation and transmission capacity is an expensive and laborious process that requires long-lead times. Power companies are desperate for solutions that are deployable today to meet peak demand and enable more renewable energy to be used regardless of when it is produced. At the same time, consumers and businesses are seeking solutions that align with their decarbonization goals.
Ice Energy, a thermal energy storage company headquartered in California has such a solution. They provide distributed grid-scale virtual power plant solutions for permanent load shifting, peak to off-peak, which helps utilities meet their resource adequacy requirements and ultimately saves consumers and businesses money, while improving their carbon footprint.
CorpGov: How does Ice Energy help manage power demand?
Joe Raasch, Ice Energy:
Our Ice Bear line of products store energy by freezing and storing ice during cooler, off-peak hours.
During peak hours, it turns off energy-intensive AC compressors and uses the stored ice to provide cooling for up to 8 hours. This reduces the overall utility cost for our customers.
The timing difference in energy usage helps smooth out net load and solve impacts of the “Duck Curve” on the grid.
CorpGov: The Duck Curve?
Joe Raasch, Ice Energy:
Yes, the Duck Curve – according to the DOE meaning “the difference in electricity demand and the available amount of solar energy during the day” named after its resemblance to a duck when graphed.[2]
The duck curve is a significant concept in California’s energy landscape, especially with the increasing adoption of renewable power. The curve illustrates the timing imbalance between peak electricity demand and renewable power generation. During the day, when solar generation is at its highest, the net load (total demand minus renewable generation) dips significantly. This dip creates a “belly” in the graph. As the sun sets and renewable generation drops off, the net load rises sharply, creating the “neck” of the duck. This rapid increase in demand in the evening, when people return home and use more electricity, poses challenges for grid operators who must quickly ramp up other forms of electricity generation to meet the demand. This is getting more pronounced and is now even referred to as a ‘Canyon Curve.’
Ice Energy’s products change this shape by freezing and storing ice during cooler, off-peak hours. During peak hours, the system turns off energy-intensive air conditioning compressors and uses the stored ice to cool the business or house. This process reduces the overall utility cost for customers and helps balance the grid by shifting energy usage from peak to off-peak times. That is why there’s such a need for technologies, like thermal storage, that can shift electricity load to off-peak times.
Thermal energy storage (“TES”) enables power to be optimally managed throughout the day, by using electricity when it is cheapest to generate or when renewable energy is abundant rather than when we need to use it.
CorpGov: Who are Ice Energy’s customers?
Brice Soucy, Ice Energy Board Member: Ice Energy helps two types of customers: utilities and the end user of electricity.
For utilities, we can store energy in the form of ice when it’s not immediately required or when there is excess renewable generation.
Then we help discharge energy during peak hours when it’s needed. By aggregating end users including households and businesses into virtual power plants, Ice Energy helps utilities balance the increasing acute demand imbalance. Utilities are able to use this capacity to reduce their resource adequacy (RA) requirements. For end-use customers, the people who pay electricity bills, we save them money. As the rate per kilowatt is higher during peak demand, we help customers with “time-of-use” rates and businesses are generally charged a demand charge based on their peak consumption that we reduce.
Customers can’t change when they need air conditioning, but now they can shift electricity consumption to off-peak times when the rates are substantially cheaper. When deployed with lithium-ion batteries, thermal storage creates a hybrid long duration energy storage (LDES) solution that improves peak load shifting potential and ultimately enables more renewable energy to be deployed. Due to thermal storage’s cost, lack of degradation, efficiency and ability to match the timing of when AC load is needed, the National Renewable Energy Laboratory (NREL) found that the synergy of combining battery and thermal storage can result in an increase in cost savings for end users by over 70%, especially when onsite solar and EV charging is used.[3] NREL found that the optimal combination is 71% thermal and 29% lithium-ion batteries and that the the life of lithium-ion batteries can be extended by reducing cycling by over 50%.
We believe the deployment of hybrid battery and thermal LDES will be a game changer for utilities to address the acute challenges the grid is facing to achieve net zero.
CorpGov: The actual product sold is called Ice Bear. How does Ice Bear work?
Brice Soucy, Ice Energy Board Member: The beauty of the Ice Bear technology lies in its simplicity and effectiveness. The system creates ice, which is then used to cool the building or house. The Ice Bear operates during off-peak hours, at times using excess renewable energy to create ice. Then, during peak demand, the system shuts off the air conditioner compressor and reduces power consumption from AC by 95%.
By using Ice Bear technology, we target the utility and homeowners’ biggest energy hog (AC consumption can be 40% to 50% of peak demand in the summer!): air conditioning! During the most expensive time of the day, a building or home can stay cool and comfortable with its air conditioner turned off, saving money and reducing the impact on the electric grid.
CorpGov: Is the technology environmentally sustainable? Are the materials for manufacturing Ice Bears sustainably sourced?
Joe Raasch, Ice Energy: The very nature of Ice Bear’s business model and product lines is sustainable, as the water used as a storage medium in our product is contained, frozen and continually reused. The same volume of water is frozen and thawed over and over again.
All materials are recyclable with no rare earth metals and our product is proudly made in the USA, qualifying it for the domestic content adder in the Investment Tax Credit, reducing capital costs by 40%.
Deploying thermal storage enables the utilization of onsite renewable energy and the capacity our VPPs create also helps utilities integrate grid-scale clean energy solutions, increasing our overall impact.
CorpGov: How do you view the market opportunity?
Jason Zibarras, Founder Argo Infrastructure Partners: We are bullish on thermal energy storage. There are significant tailwinds in recent years given the acute issues facing the grid and the impacts of extreme heat events. Utilities are struggling to provide electric capacity during peak cooling times; by 2050, the IEA predicts that one-third of peak electricity demand will be for air conditioning.
Thermal energy storage is a large and expanding market. Demand for air conditioning is increasing and has been cited as a contributor to blackout events (i.e. August 2020), increasing strain on the grid.
CorpGov: What is your near- and long-term business strategy and competitive position?
Jason Zibarras, Founder Argo Infrastructure Partners: Our near-term goals are to expand the market for thermal storage and further integrate thermal storage into utility systems, including by deploying hybrid LDES in the form of VPPs. Thermal storage is a valuable asset as part of virtual power plants, we have only begun to scratch the surface.
Recent successes include partnerships with large investor-owned utilities in Southern California. That program has successfully been in place over the last 5-plus years and has long-term 20-year contracts matching the technology’s useful life (Ice Energy Announces Key Milestones of Its Southern California Virtual Power Plant Thermal Energy Storage Program).
In terms of our long-term strategy; we plan to continue providing capacity to the grid using thermal energy storage, actively selling capacity contracts and expanding the deployment of Ice Bear units. We have a product that has been deployed in the field for over 5 years. It is a proven technology in an expanding market. We are also bringing to market a product optimized fro the residential and small commercial market, the Ice Cub, in Q1 2025; stay tuned for updates on its launch.
The benefits of the Ice Bear have been proven and we anticipate increasing market penetration. By 2030, 12 GW of California’s peak demand will be from commercial and residential HVAC; meeting just 8% or 1 GW of this with thermal storage is more than a $1 billion investment opportunity that would result in significant savings for end users and RA benefits for utilities.
[1] Thunder Said Energy, April 2024
[2] https://www.energy.gov/eere/articles/confronting-duck-curve-how-address-over-generation-solar-energy
[3] https://www.nrel.gov/docs/fy23osti/83068.pdf
Editor@CorpGov.com
