Project Background

San Vicente Energy Storage Facility

As of Jan. 27, 2022, the City of San Diego and the San Diego County Water Authority are starting negotiations on a project development agreement with the BHE Kiewit Team to develop Phase 1 of the potential San Vicente Energy Storage Facility Project, which could generate enough energy for about 135,000 households.

The BHE Kiewit Team — which includes BHE Renewables, LLC, and Kiewit Development Company. BHE Renewables, LLC — is a wholly owned subsidiary of Berkshire Hathaway Energy Company. The Water Authority Board of Directors also approved negotiating with Rye Development, LLC, if negotiations with the BHE Kiewit Team are not successful.

In addition, the Water Authority’s Board approved a $4.6 million contract with AECOM Technical Services, Inc. to perform environmental work for the project, and a $1.6 million amendment to a professional services contract with Black & Veatch Corp. to support project development agreement negotiations, provide technical expertise for a California Independent System Operator interconnection application, perform preliminary design and engineering reviews, and assist with preparing a Federal Energy Regulatory Commission (FERC) license application.

The Board’s January actions followed the September 2021 issuance of a formal Request for Proposals seeking a full-service private partner capable of developing a large-scale pumped energy storage project planned jointly by the Water Authority and the City of San Diego.

The San Vicente Energy Storage Facility is one of the most promising pumped energy storage solutions in California. It under consideration by a partnership of the Water Authority and the City of San Diego. This project could store 4,000 Megawatt-hours per day of energy (500 Megawatts of capacity for eight hours). In July 2021, San Vicente Energy Storage Facility received $18 million in the state budget signed by Gov. Gavin Newsom, enough to advance the project through initial design, environmental reviews, and the federal licensing process.

The potential project would create a small upper reservoir above the San Vicente Reservoir, along with a tunnel system and an underground powerhouse to connect the two reservoirs. The powerhouse would contain four reversible pump turbines. The reservoir is near major electricity transmission interconnection facilities, which would allow the project to play a central role in integrating solar and wind energy from across the Southwest for use in San Diego County.

During off-peak periods – when power is inexpensive and renewable supplies from wind and solar facilities exceed demand – turbines would pump water to the upper reservoir where it would act as a battery of stored potential energy. During high energy use, the system would discharge energy as water from the upper reservoir flows downhill through the turbines. The exchange between the two reservoirs would not consume water and is closed-loop.

California is a world leader in renewable energy

The state already sources nearly one-third of its power from renewables, mainly solar and wind. The target for clean energy in California is 100 percent by 2045 – and large-scale energy storage in the form of pumped energy storage will play a vital role in reaching that goal.

A major shift to renewables will require new kinds of investments, markets, and business practices. Electric grids need to be more flexible; new kinds of power supplies will help deliver energy flexibility when needed; and new pricing systems are needed to send clear signals to developers and financial markets that these projects need to move forward.

Pumped energy storage projects are designed to store excess renewable energy from solar and wind during the day, and then discharge that energy when energy usage increases in the evening and renewable energy is not available.

A 2019 white paper highlighted the importance of pumped energy storage to California’s renewable energy future.

A 2019 article in the AWWA Source magazine explained the value of pumped storage to a statewide audience.

Regional benefits include:

• Generate additional revenue to offset water agency costs and help stabilize water rates
• Provide an essential energy resource to enhance grid reliability to avoid power outages and rolling blackouts
• Produce energy on demand, especially during high-energy use periods
• Store surplus renewable wind and solar energy during low-energy use periods
• Reduce greenhouse gas emissions

Planning and investing for large-scale energy projects like the San Vicente Energy Storage Facility takes time. It is important to take steps now to ensure this potential project can help California realize a clean energy future.