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Investment

Counting the ways to store renewable energy

Multiple technologies are vying to house temporary surpluses of solar and wind power

by Alex Scott
October 21, 2018 | APPEARED IN VOLUME 96, ISSUE 42

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Credit: Shutterstock
The falling cost of wind and solar energy is driving the need for energy storage systems.

A mind-boggling array of energy storage technologies—including batteries the size of an Ikea furniture store and tanks of salt hydrates the size of oil drums that release heat—is being tested in labs and workshops across the globe.

Energy storage by the numbers

5 years: The time it will take for energy storage capacity to increase 10-fold from its current level of 6 gigawatt-hours

 

96%: The current share of energy storage that is pumped hydro, where water is pumped uphill during periods of low energy demand and released to drive a turbine during peak demand

 

<5%: The share of electricity currently generated by intermittent renewables like wind and solar

 

11.4%: The share of renewable electricity generation forecast for 2040

 

$10 million: The amount that power firm Neoen will have generated in revenue within six months of installing a 129-MWh lithium-ion battery

 

Sources: European Association for Storage of Energy; Turgut M. Gür, professor of materials science and engineering, Stanford University; International Energy Agency; Rory McCarthy; Giles Parkinson

They are vying to become the approach of choice to stabilize electric grids when energy from renewable sources passes 20% on an individual grid—the point at which the unpredictable nature of renewables becomes unmanageable. In a future where solar and wind energy steadily replace carbon-based fossil fuels, energy storage technologies will be needed to keep the lights on when the wind drops and the sun goes down.

Energy storage used to be so simple. It was once a low-tech sector in which water was pumped uphill during low energy demand and released during peak demand to drive turbines and return electricity to a grid. But pumped hydroelectric storage is limited by geography.

The new technologies include chemical, electrochemical, mechanical, and thermal energy storage systems. Each type presents different capacities, charge-discharge rates, reliability, and capital and operating costs, which means many could find market niches in the coming years.

The energy storage market is taking off now because wind and solar have finally become cheaper sources of electricity than burning coal and are on par with or cheaper than natural gas. “These prices are beating everyone’s expectations,” says Rory McCarthy, senior analyst for energy storage with the consulting firm Wood Mackenzie.

Regulation to encourage the adoption of renewable energy is also underpinning the demand for energy storage. California has mandated that electricity must be 100% carbon-free by 2045. “The U.S. is five years ahead on [energy storage] policy, but China is picking up the pace, and the EU is also putting regulations in place,” McCarthy says.

Shifts in legislation, economics, and funding are combining with rapid advances in technology to create a surge in demand for grid energy storage systems, McCarthy says. “It’s the perfect storm for energy storage.” Over the next five years, he adds, worldwide energy storage capacity will increase by a factor of 10 from the current level of 6 gigawatt-hours.

The role that developing countries play in energy storage should grow after a recent announcement by the World Bank that it will lend $1 billion to draw in a further $4 billion from public and private-sector investors for energy storage—especially battery storage in developing countries.

All the new technologies will have to contend with lithium-ion batteries, which are way ahead of the competition in both maturity and market adoption, according to McCarthy. They are already used extensively in cars and portable electronics and thus enjoy economies of scale that emerging technologies do not. Right now, this widespread market acceptance and lower cost profile make them a safe bet for investors, he says.

Early successes bolster the case for lithium-ion batteries. In 2017, Neoen, which operates electricity grids in Australia, bought a 129-MWh lithium-ion battery from Tesla. With capacity to power 30,000 homes for about an hour, the battery is intended to supplement grid power during periods of peak demand.

The battery generated $10 million in revenue during its first six months of operation, says industry analyst Giles Parkinson. Energy during peak demand in the region was formerly provided by natural gas.

Such projects might have firms like BASF, a leading supplier of materials for lithium-ion car batteries, purring. But BASF thinks it can do better than lithium ion for stationary energy storage. The German chemical firm is developing alternative batteries based on sodium and sulfur. It also owns a stake in the Portland, Ore.-based start-up Energy Storage Systems (ESS), which is developing redox flow batteries based on iron chloride.

Unlike a lithium-ion battery, ESS’s flow battery can provide power for more than four hours in one discharge, and it experiences no capacity fade for 20 years, the company claims. “We believe there is a strong case to be made for long-duration storage solutions, especially for renewables integration—and that the market is looking for alternatives to lithium-ion,” ESS CEO Craig Evans said earlier this year.

ESS recently secured its first commercial contract: a $1.3 million combined energy storage and solar power system in Brazil. The goal is to eliminate the use of diesel generators during peak hours.

Developers of vanadium flow batteries also reckon they can compete with lithium ion. With backing from the Chinese government, Rongke Power is building near Dalian, China, what is set to be the world’s largest battery: a vanadium flow battery with a capacity of 800 MWh. The size of an Ikea store, the battery should be able to provide 8% of Dalian’s electricity demand when it comes on-line in 2020.

The advantage of a vanadium flow battery over its lithium-ion counterpart is that it can run for 40 years, with zero degradation in performance for half of that time, proponents say. The cost of energy from a vanadium flow battery is currently higher than the $150 per kWh offered by lithium ion, but analysts say it could be competitive by 2020.

The backer of another high-powered battery chemistry says it is already there. Last month, Patrick Soon-Shiong, a California billionaire who made his money in the biotech industry, announced that the start-up he chairs, NantEnergy, has a zinc-air rechargeable battery that can provide electricity for less than $100 per kWh. Although it has a similar cost profile to lithium ion, the technology has superior duration, the firm says, delivering electricity for days. The zinc-air battery also avoids the need for cobalt and lithium, raw materials that are becoming increasingly expensive as demand for lithium-ion batteries grows, NantEnergy says.

During charging, the zinc-air battery uses electricity to convert zinc oxide to zinc and oxygen. When discharging, the battery oxidizes the zinc with oxygen from air, generating electrons to provide electricity.

NantEnergy, previously called Fluidic Energy, says it has already tested 3,000 installations in nine countries. Manufacturing at scale will begin next year, the firm says.

Battery developers are getting a helping hand from a number of private and public efforts. The U.S. Department of Energy, for example, recently pledged $120 million to extend research at the Joint Center for Energy Storage Research (JCESR) by a second five-year term. Piloted by Argonne National Laboratory, JCESR will coordinate research projects among national labs, academia, and industry on a variety of battery types.

In JCESR’s first five years, affiliated researchers published 380 scientific papers and launched three start-ups. “In the next five years, JCESR’s vision is to create disruptive new materials deliberately constructed from the bottom up, where each atom or molecule has a prescribed role in producing targeted overall materials behavior,” Argonne National Laboratory says.

Although batteries are getting a lot of love, developers of nonbattery energy storage technologies say they shouldn’t be counted out. Flywheels—mechanical devices designed to efficiently store rotational energy—could still play an important role in energy storage, says Keith R. Pullen, chief technology officer at the flywheel start-up Gyrotricity and professor of energy systems at City, University of London.

Flywheels can release energy rapidly, just like lithium-ion batteries, but without limitations of batteries such as the need to be heated or cooled. Moreover, flywheels don’t degrade over time like battery cells, Pullen notes.

“The question is, how long can lithium-ion batteries last? It is possible that its storage can fall off a cliff,” he says.

Gyrotricity’s problem, however, is cost. “Lithium-ion costs are so low it’s difficult to break into the market,” Pullen admits.

Wide world

Multiple technologies are in use and being developed for energy storage.

Stages of development

Early-stage technology
▸ Adiabatic CAES
▸ Hydrogen
▸ Synthetic natural gas

Demonstration
▸ Advanced Pb-acid and flow batteries such as those using vanadium
▸ Electrochemical capacitors
▸ Salt hydrates
▸ Superconducting magnetic energy storage

Deployed
▸ Batteries (NaS, Li-ion, Pb-acid)
▸ CAES
▸ Flywheel
▸ Pumped hydro

 

CAES= compressed-air energy storage

In contrast, the Swiss start-up Energy Vault claims its kinetic energy storage system is already cheaper than anything on the market. Inspired by pumped hydro, the firm developed an automated crane that lifts and stacks concrete blocks during times of energy excess and lowers them to turn a generator when energy is in short supply.

Thanks to the low cost of concrete, the firm estimates it can operate at half the cost of competing systems. It is currently testing the approach in Biasca, Switzerland. With an output of 10 to 35 MWh, the system is suitable for most industrial and rural locations, Energy Vault says.

Beyond batteries and mechanical systems, the use of excess energy to split water into hydrogen and oxygen is being promoted as the ultimate green chemistry storage method. In addition to being energy dense, the approach offers the flexibility of converting the hydrogen back into electricity via a fuel cell or consuming it directly as a transportation fuel. But hydrogen production and storage bring challenges, including the inefficiency associated with using electricity to split water in the first place.

Still, Europe is plowing ahead with hydrogen projects, including TSO 2020, a European Union-funded program in the Netherlands to make hydrogen from renewables. One facet of the program is HyStock, a pilot project from the Dutch firm Gasunie New Energy. It features a 1-MW electrolyzer capable of generating up to 145 metric tons of hydrogen annually from local solar arrays. HyStock is on track to be running by year-end, says Anouk van den Berg, a business development executive for Gasunie New Energy.

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Several companies are working together under TSO 2020 so that hydrogen from HyStock can be stored, converted into electricity using a fuel cell, combined with waste carbon dioxide to make methane for household consumption, or supplied as a gas to nearby industry.

TSO 2020 boasts that it can store up to 8.3 metric tons of hydrogen in the underground salt caverns at its Dutch site. In terms of energy capacity, this is the equivalent of 22 million of Tesla’s Powerwall home energy storage units, TSO 2020 claims.

“HyStock is seen as a first important step to larger-scale conversion facilities, hydrogen transport, and storage,” van den Berg says. “The next step would be an electrolyzer with a scale of 20–30 MW around 2020, after which we hope to scale up to 100 MW and gigawatts between 2025 and 2030.”

By then the company hopes it will have advanced the efficiency of its technology. “We have to accept that costs come prior to the benefits at this stage of development, which partly have to be compensated by subsidies,” van den Berg says.

In an attempt to avoid the inefficiencies involved in converting electricity to a chemical such as hydrogen, then back into electricity that consumers then convert into heat—a major use of electricity—scientists formed a consortium of organizations, including the Dutch research institute TNO, to take heat from solar energy and store it as chemical energy. In this project, water is heated by solar collectors in the summer and, via a heat exchanger, is used to dehydrate salts packed in drums. When heat is needed in winter, the salts are rehydrated.

This process, which is repeatable, can be used to heat water for apartment blocks or parts of cities, says Huub Keizers, TNO program manager for energy in the built environment. TNO has been trying out a range of salts, including potassium sulfide and calcium chloride.

The consortium recently introduced a working prototype—the world’s first, it says—in the Netherlands. But the prototype is too inefficient to be heating anyone’s house this winter. “It is a big challenge to upgrade it,” Keizers acknowledges. Nevertheless, he is optimistic. Improvements in salt packing and formulation will be key to improving the efficiency of the technology, he says.

For the most part, though, storing electricity—rather than heat—is the target of energy storage systems. There, lithium ion remains the technology of choice.

Asking energy analyst McCarthy about the viability of some of the alternatives brings a wry smile. Investor confidence is key to determining whether prototype technologies will fly. Right now, lithium ion is simply a safer bet than any of the alternatives, he says.

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Comments
Solarman (October 21, 2018 10:07 PM)
These energy storage technologies are the next evolution of the century old electric grid system. Alternatives such as wind and solar PV have enough "real estate" in most locations to power a home or business with the amount of average solar insolence delivered to the home or business roof every day. Electric utilities are finding that "non-fueled" generation resources are much cheaper to operate over the life of the generation facility. The article mentions the efficacy of the "small" TESLA energy storage system off of the Neoen wind farm in Australia. Even with alternative generation resources "requiring" energy storage along the grid, the grid also becomes more inefficient when fueled generation resources are ramped down to so called "spinning" modes of operation. If you have a place for excess energy to go, then keeping the fueled plant ramped up for more efficient operation would also lower operating costs overall. I believe Australia has a proof of concept grid model in operation. Instead of building Peaker plants or running old fueled plants in spinning mode until energy is "needed" by the grid, keep the plants ramped up and store the energy for later use without the need to ramp up a coal fired plant that has been wasting fuel AND polluting the air with no energy benefit on the grid. The same could be done with a nuclear plant, to keep its output at an efficient level for plant amortization.
Colin Hill (October 23, 2018 5:30 PM)
Can you please confirm the use of kWhr rather than MWhr in the article with regard to price of energy through battery?
$150/kWhr seems extremely high.

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