Cal State University announced Wednesday a landmark energy project expected to cut costs by millions and provide a boost to the electricity grid.

The 23-campus university and San Francisco-based Advanced Microgrid Systems will install advanced battery storage facilities at several locations — starting at Cal State Long Beach this summer — with the first phase aimed at reducing electricity costs by $3.3 million and storing enough energy to power 2,000 homes.

Officials said the energy storage project will be the largest of its kind at an educational institution in the United States.

“By helping integrate more renewable energy onto the grid, this transformational system will support California’s environment and direct resources to support the academic mission of the CSU,” said Steve Relyea, CSU executive vice chancellor and CEO, in a statement.

During the first phase of the project, AMS will oversee the design, installation and operation of a 1-megawatt energy storage system at CSULB. AMS also is looking to install two “behind-the-meter” energy storage systems at the Chancellor’s Office in Long Beach and at Cal State Dominguez Hills in Carson.

A behind-the-meter energy system is not part of a utility company grid, and is designed for a residence, single building or facility.

According to the GTM Research/Energy Storage Association’s U.S. Energy Storage Monitor 2015 Year in Review, behind-the-meter energy storage accounted for 15 percent of the U.S. energy storage market. The behind-the-meter market grew 405 percent last year, with Hawaii leading the residential segment and California leading the nonresidential segment.

GTM Research forecasts that the annual U.S. energy storage market will be valued at $2.5 billion by 2020.

With the project starting at CSULB this summer, officials expect its completion in October. Construction at the Chancellor’s Office is expected to begin early next year, with completion by the middle of 2017.

Paul Wingco, associate director of physical planning and facilities management at CSULB, said the project is part the overall goal to be more energy sustainable on campus. CSULB’s Climate Action Plan aims to achieve “climate neutrality” by 2030 through reducing greenhouse gas emissions associated with campus operations and activities.

CSULB in 2017 also will install a sizeable solar energy system, Wingco said.

The battery storage facility will be shaped like a cargo container about 30 feet by 40 feet, officials said.

“This battery energy storage will work along with that solar system to basically stabilize our campus grid, and at the same time reduce our utility costs and be a part of our a micro-grid,” he said.

Cal State Dominguez Hills is negotiating a contract and site for the project there. Kenny Seeton, central plant and energy manager for the campus, is hopeful the project will start this year. The savings come on peak-use charges, which can be costly, he said.

“When the heat gets really bad and the whole world turns up their air-conditioning, including us, we’re able to kick in the batteries so it’s not so demanding on the grid, and we save some money doing that,” Seeton said.

The projects feature Tesla Powerpack commercial batteries to store energy during nonpeak hours, typically at night, officials said. During high demand, AMS uses advanced analytics software to shift buildings from the electric grid to the AMS energy storage system, which cuts grid congestion and reduces the need to build additional peaker plants.

“The CSU is setting the standard for sustainability among higher education institutions, both statewide and across the nation,” said Susan Kennedy, CEO of AMS, in a statement.