A123 Systems is launching a pilot project with NSTAR to study and showcase the performance and reliability benefits of implementing A123’s Grid Storage Battery (GBS) within a suburban electric grid. The system, NSTAR’s first battery energy storage project, is proposed for installation at a substation in Medway, Massachusetts, and is expected to be operational in 2012.

Under the terms of the agreement, one of A123’s 2 MW GBS solutions is proposed to be interconnected to the power grid at NSTAR’s substation in Medway. It will be owned and operated by A123, and will be designed to provide area regulation services, which are used to address momentary differences between electric power supply and demand. A123 expects to earn revenue from these area regulation services from ISO-New England (ISO-NE) as part of the Alternative Technology Regulation (ATR) Pilot Program, which allows “non-generating resources” such as advanced energy storage systems to receive compensation for area regulation and other ancillary services. In addition, the pilot project is expected to allow A123 to learn more about how its GBS performs in real-world applications in order to facilitate further product improvements designed to reduce total cost of ownership.