Towering over the Lactalis dairy in Etobicoke are two giant metal silos filled with cream ready to be cultured into yogurt.

Tucked into the shade beneath them is a white shipping container filled with batteries ready to step in at a moment’s notice and power the entire plant.

The industrial-scale batteries are an innovative way one of Canada’s oldest businesses is using technology to save money, reduce its carbon footprint and relieve pressure on the electrical grid. Deployed widely, these kinds of batteries could play a significant role in reducing Canada’s carbon emissions and building a net-zero economy.

The Lactalis batteries kick in whenever there’s a micro-outage — a tiny fluctuation in the power feeding the plant — that can reduce the temperature of the pasteurization process and wreck an entire batch of yogurt.

They also activate when the grid is straining under peak demand, and the province activates its fleet of emissions-intensive natural gas generators, powering the plant autonomously and freeing up power for others.

The combined savings from not paying for power at peak rates — a premium which generates up to 70 per cent of the electricity bills for large, industrial users — and not having to dispose of up to 10 spoiled batches of yogurt per year adds up to hundreds of thousands of dollars in annual savings.

“We have the benefit of running the plant when the power goes off — that’s very, very important — and reducing carbon and energy to help the planet,” said Maurizio Bizzarri, director of corporate engineering at Lactalis Canada.

The battery system was installed at no cost to Lactalis through a partnership with Peak Power, a Toronto-based company that operates the batteries, as well as Switch Power, an Alberta-based power producer which financed the capital costs.

All three companies share in the savings on the dairy’s power bill.

“It all comes down to something for free. You get significant savings for free,” said Derek Lim Soo, CEO of Peak Power, who set up a deal that will install batteries at five Lactalis dairies in Ontario. “It’s meant to be risk free. No capital upfront. Impactful impact to your bottom line; impactful impact to your environmental footprint.”

Those punishing rates for peak power are prompting action. Another large user, McMaster University, pays so much for its electricity that it built its own gas-powered generators to take itself off the grid during peak hours, drawing the ire of students and environmentalists who said using batteries would have been a more environmentally-friendly solution.

A pilot project in Harbord Village, meanwhile, put batteries in 10 houses and co-ordinated them remotely so they could activate simultaneously and reduce demand during peak hours.

For businesses that use a diesel generator for backup power, replacing it with a battery unlocks other uses that offer their own revenue streams, said Justin Rangooni, executive director of Energy Storage Canada. A company can charge up the battery on cheap electricity overnight and then use it during the day to avoid paying for expensive electricity from the grid.

“Once you have energy storage, the benefit is that it does these other things as well,” he said. “It’s a Swiss army knife for companies.”

“Not only is it a cleaner option for emergency backup power. It’s better for the business and better for the grid.”

According to the Independent Electricity System Operator, Ontario has 89 per cent carbon-free electricity. But that annual average for 2022 glosses over the fact that the grid is often 100 per cent carbon free, as long as the gas plants aren’t operating.

Gas plants were activated just under six hours a day last year on average, according to IESO statistics. But if demand during peak time can be reduced, those plants won’t need to be fired up as often, reducing carbon emissions from electricity generation.

The federal government has drafted regulations to establish a net zero grid by 2035. Achieving this goal will require building lots of renewable energy, like wind and solar. But batteries will play a key role by helping us use existing generation more strategically, according to a report put out by Clean Energy Canada.

“We’re in a situation where if batteries don’t come, I don’t know what we’ll do, because I think the reality is that relying on gas turbines just doesn’t make sense,” said Lim Soo.

Because these kinds of batteries are installed “behind the meter,” the province doesn’t know exactly how many even exist. A report commissioned by the IESO last year estimated that there were 250 megawatts of behind-the-meter batteries provincewide.

That’s more energy storage than currently installed on the grid, where a large investment in grid-scale batteries was recently announced meant to capture surplus renewable power and store it until demand ramps back up.

At the dairy in Etobicoke, the battery can power the plant for two hours at a time — more than enough to make it through these critical peak periods, Rangooni said.

“Peaks in the system are short-term, so having short-term assets to alleviate them is critical and efficient.”

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