Have you ever attempted the nine dots puzzle? The object is to connect nine dots (arranged in a grid) using as few straight lines as possible, without lifting your writing implement. Go ahead and give it a shot when you’re idly doodling through your next conference call.
It turns out it’s not that easy.
It is possible to solve the puzzle with four lines, three lines, or even fewer; depending on one’s level of creativity. But any solution requires you to stray outside the perceived boundary around the nine dots. You have to… you already know what’s coming… think outside the box.
“That’s where our name derives from,” beams NineDot Energy cofounder and CTO Adam Cohen. “We think of ourselves as not just problem solvers- but also creatives. We’re really good at putting puzzles together.”
If you can build it here, you can build it anywhere
Cohen and his team are focused on building battery energy storage projects in New York City and the surrounding area. That task is a tall one- skyscraper puns aside- considering the constraints posed by cramming eight million people into a space roughly the size of Augusta, Georgia.
“There are unique challenges in that you can’t build a 25-acre solar farm and then put on a couple of batteries in an old, rural area and then put it onto the local power grid with the feeder lines going through,” Cohen explains. “You have to be part of the community. You are enmeshed in buildings and in the built environment.”
While Cohen explains the challenges of developing in NYC, I can’t help but notice how his work-from-home setup in the city unintentionally demonstrates what he’s driving at. He’s chatting with me from an office that appears to double as a playroom, complete with an abstract drawing scribbled on the back wall – almost certainly without proper siting permits and in a medium that has likely proven to be non-washable ink. EDIT: Turns out that was a whiteboard, per Adam. That’s a much better place for a drawing than a wall!
“In this case, we care about being connected to the power grid in the right places to provide benefits at reasonable costs,” Cohen goes on. “But how do you get access to the land? How do you then build the project and get all the permits and interconnections? How do you then operate and be a good neighbor?”
These concerns are not unique to energy storage, but they’re unique to urban environments, he contends. New York City has taken strong stances on protocols and procedures for building and siting projects; Cohen calls them the most robust standards in the country, if not the world.
“They actually look at the individual technologies that we start with and approve them,” Cohen remarks. “I don’t think there’s any other jurisdiction that does that.”
Cohen laments how long it took to get to this point, but sees New York as the gold standard for safety and wants its rules to catch on elsewhere. “The fire department in particular has been leading the charge and showing the world the right way to install batteries,” he adds.
Earlier this month, New York’s Inter-Agency Fire Safety Working Group released initial recommendations outlining new safety standards for battery energy storage systems, including potential updates to the Fire Code of New York State (FCNYS), and a list of additional opportunities for defining and implementing best practices.
“New York has been a bellwether for seeding new ideas,” says Cohen. “We’re a big part of that market, and I’m hoping that idea spreads naturally.”
Gotham’s growing goals
Cohen started his career as a postdoctoral fellow at the Department of Energy in Washington, D.C., where he met NineDot Energy cofounders David Arfin and Nalin Kulatilaka. In 2012, Cohen launched a new research program about using social and behavioral science to make solar cheaper and easier to build and adopt.
Energy Secretary Steven Chu prepared to announce the program at a presentation in Denver. It was kind of a big deal.
“He had put slides together,” recalls Cohen. “In one, he had a block diagram of the most complicated jurisdiction in the country and how complicated it is to get solar on a rooftop- and it happened to be New York City.”
The Nobel prize-winning physicist took the stage, but he’d never get the chance to announce Cohen’s program.
“His computer froze on that slide. So he just had to abandon ship,” he laughs. “The New York City permitting system broke his computer.”
Perhaps it was an early sign that Cohen was destined to apply his brain to the unique puzzle of packing battery energy storage into New York City. He and his team (which is now 44 people as of January) have been turning that particular stone in their hands since evolving out of Certain Solar, a fuel cell project developer, in 2021.
“Over the last two years, the market has changed substantially for the better,” suggests Cohen, referencing support for energy storage at the state and federal levels.
The economics of BESS projects in the Big Apple changed significantly once standalone energy storage was included in the guidance for utilizing the IRA’s Section 45X tax credits. Adders for supporting domestic manufacturing, developing in lower-income communities, and cleaning up environmental hazards have further fueled NineDot.
“For us, we see incentives,” quips Cohen. “And incentives work.”
“We were in this business already, but [the IRA] has kind of helped us make decisions. We see it as a way that motivates us to do types of projects we might not have done before.”
Investors seem to agree. Last month the company secured an additional $225 million equity capital commitment from Manulife Investment Management and Carlyle (NASDAQ: CG), NineDot’s existing institutional equity investor.
And there’s momentum behind a green movement on the ground. In December, the New York City Council passed legislation deeming itself the “City of Yes for Carbon Neutrality,” whatever that’s supposed to mean. In practice, it’ll start with modernizing NYC’s zoning regulations to better support climate goals. There’s a video in the first hyperlink that promises to explain more, but I warn you: it’s an unedited 3-hour, 45-minute slog with audio that sounds like it was recorded inside a headset at NASA mission control.
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“They wanted to expand the market,” concludes Cohen, who sees energy storage as essential for urban areas to reach climate targets.
A few months ago, New York state eclipsed 2 GW of installed community solar- the goal is 6 GW by 2025, and 10 GW by 2030. But developing it in the big city itself poses obvious problems.
“In dense urban areas, there’s not a lot of room for community solar, but community storage can play that role,” Cohen contends.
Earlier this year, Governor Kathy Hochul announced a program called Solar for All, which is being reviewed by the Department of Public Service. Under the proposal, New York State would fund solar farms to benefit homeowners and renters who may not be able to access clean energy. On its face, it’s a utility bill assistance program. However, some critics fear it will dismantle the industry and hand control to utility providers- while simultaneously underdelivering on the promises of the program.
“We’re hopeful that community storage is a part of that program,” says Cohen. “We’ve been advocating for this and working on it for a number of years and we see that as an important piece of the puzzle.”
Serving the underserved
Another piece of Ninedot’s puzzle- man, they sure do love puzzles- is regularly working in and with historically underserved areas. The company operates a solar and storage site in the Bronx and is developing a project on Staten Island. At the former, the Ninedot partnered with a local artist and an elementary STEM program to commission a massive, 135-foot mural. The finished work of art was revealed last fall.
In 2019, New York passed its Climate Leadership and Community Protection Act, which contains a clause about equity and inclusion that promises at least 35% of renewable energy benefits will be directed to disadvantaged communities.
“So it has been part of the conversation in New York for five years,” recognizes Cohen. “That’s led the charge.”
While there are certainly incentives for doing so, NineDot’s cofounders take pride in making the grid more resilient and reliable while supporting actual people in the process. Cohen compares putting power on the grid to creating a piggy bank of value- one that can be sold piecemeal as offsite subscriptions to businesses or households.
“We can site projects in places disproportionately impacted by grid problems, which happens to also often be in disadvantaged communities,” he says. And in New York, location is everything.
“Wherever you build, there was something there before. There is a history.”
-NineDot CEO Adam Cohen, on developing in New York City
“Clean energy is really a real estate program, and New York is a real estate town,” Cohen laughs. “Now we’re a part of that story.”
Cohen expects to continue to develop projects in low-to-middle-income areas. In the meantime, he hopes battery energy storage continues to be part of the legislative conversation. The IRA currently includes an adder for such LMI community solar projects, but not storage.
“I think that’s something that can be changed,” Cohen predicts.
GO DEEPER: Check out the Factor This! energy storage podcast playlist, including episodes on battery storage, long-duration energy storage, gravity storage, and more. Subscribe wherever you get your podcasts.
Connecting the rest of the dots
NineDot Energy, which claims Starbucks as an anchor subscriber, has amassed a capital base of at least $400 million. The new influx of cash secured last month will allow the company to expand its pipeline in New York City and beyond.
“We saw more growth ahead of us and we wanted to be ready for it,” Cohen explains. “We’re not really just a battery energy storage company. We’ve done other types of projects. We’ve done vehicle to grid, EV charging, solar- we see lots of opportunities to explore and build sustainable markets.”
All of that- and a little more- will probably be necessary for NYC to go completely green. Cohen is unphased by the challenge.
“In the last five or so years we’ve been working in New York City to find ways to connect the dots in new ways,” NineDot’s CTO concludes. “And I think we’re pretty good at it.”