Next Five Years Crucial to Energy Storage

Prices Must Fall

Ken Silverstein | Feb 15, 2012


Energy storage is getting a bump in the president’s proposed 2013 budget. It’s an extra boost that the industry says that it needs to get out of the lab and into market. Just how far off is the concept whereby such stored power is released when the wind dies down or the sun doesn’t shine?

It’s here now. But some major hurdles are blocking wide scale deployment. Balancing the electricity load is difficult. Storage devices, if they can be shown to work at commercial scale, would be a huge boon to an industry that is trying to advance renewable power. It can help utilities avoid downtime and thereby save billions in lost opportunities while also allowing such companies to sell blocks of peak power at premium prices.

“The choice we face as a nation is simple: Do we want the clean energy technologies of tomorrow to be invented in America by American innovators, made by American workers and sold around the world, or do we want to concede those jobs to our competitors?  asks Energy Secretary Steven Chu. “We can and must compete for those jobs.”

The amount of money that would be allotted to clean energy, generally, would climb by 2.3 percent from the 2012 budget to the 2013 budget. The White House says that such an increase, albeit small, is still making a significant statement with respect to President Obama’s commitment to renewables and green technologies. 

Specifically, he is asking that $27 billion go toward all of the Energy Department's endeavors. Of that, $60 million would be targeted to researching and expanding the uses for energy storage systems. That’s on top of the $185 million provided to 16 separate storage projects via the 2009 stimulus plan.

A KEMA study is forecasting that if the technology is given the right financial incentives then 2-4 gigawatts of energy storage would be developed in five years. The study also says that the cost of the now-expensive storage will drop.

To reach the size and scale that is needed to cut prices, the Electricity Storage Association is advocating for tax and financial incentives like the investment or production tax credits given to wind and solar, which may not get renewed after this year. It also wants to see energy storage included in the Obama administration’s clean energy standards as well as renewable portfolio standards that are now set at the state level.

“The next five years will be critical and provide enormous opportunity to move storage technologies to full commercialization,” says Brad Roberts, executive director of the storage group. 

White House Supportive

To be clear, storage devices come in many forms: The most prevalent ones today are batteries that link to the transmission grid where they siphon off power at night, and store it. It is then dispatched during the day when prices rise. Then there’s the fast-response flywheels, and a deviation of that called kinetic energy storage that is practical for short-term needs.

Beyond those tools, there's also compressed air energy storage that holds air underground and releases it in heated form to create electricity. And there’s the mature pumped hydro storage, whereby turbines push water into reservoirs at night and then let it go during the day when demand is highest.

The younger products are now relatively expensive and it is still unknown how they would operate in a commercial setting. If they are to be cost effective, they must be able to offer other services, say experts. Until then, the federal government will partner with private industry to help foster this sector.

The Oak Ridge National Laboratory has applied for a grant from the Energy Department to, among other things, help get lithium ion batteries into hybrids and all-electric vehicles, as well as get them connected to solar cells and windmills.

“However, safety of the technology is still a concern, service life is not yet sufficient, and costs are too high,” the lab says, noting that its efforts would serve to break down those barriers.

In a talk with this reporter, Celgard President Mitch Pulwer said that the lithium ion technology is effective now. But he adds that governmental assistance is needed for the advanced battery industry to ratchet up production and enable a supply chain, all of which will help reduce prices for batteries -- a tool that also has powerful applications for the utility industry.

“The challenge with the grid is that the load is not uniform,” adds Gary Rackliffe, with ABB Inc., in an interview. “Energy storage balances those demands and addresses the issue of variability.”

Energy storage’s potential could be short-circuited unless the price of the technology starts to fall. The White House sees the possibilities, garnering the thanks of an industry that also wants parity with other clean tech investments. 

EnergyBiz Insider is the Winner of the 2011 Online Column category awarded by Media Industry News, MIN. Ken Silverstein has also been named one of the Top Economics Journalists by Wall Street Economists.

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Storage crucial next five years

The Energy Biz article and energy industry in general fails to recognize biomass as an energy storage medium.  Green plants collect solar energy and, through photosynthesis, convert it to chemical energy which is stored and easily converted to electricity, heat, transportation fuel, other biobased chemical products, and even a fuel for fuel cells.  Conversion of biomass stored chemical energy to other forms of energy can be done while the sun isn't shining, while the wind isn't blowing, when the tide is in or out, and whenever someone wants to make the chemical to physical energy conversion.  Biomass can be stored on the stump, wood pile, or pellets, in the case of woody vegetation, or it can be stored in large bales, in the case of grass or stover.  Of all the ways in which solar energy can be stored, biomass storage should be high on the list of alternative energy storage options.  Furthermore, integration of biomass storage with other technologies for collecting solar energy, ie wind, hydro, photovoltaics, and other chemical storage is an opportunity that should be recognized and explored more fully.  Hope this comment will help resolve this crucial need in the next five years.   

The most prevalent form of energy storage...

The most prevalent form of energy storage is thermal energy storage. It is a disruptive technology for smart buildings. Hot water heaters and ice storage for cooling buildings provide energy storage on the customer side. With advances in smart grid software we will see less dumb buildings and instead smart grid buildings that can communicate and engage with the grid without customers losing any comfort or convenience. Not to mention, air-conditioning which is the main source of on peak demand can be offset directly by energy storage that stores cooling in buildings. Flatter building loads means more stability for the grid, no matter what the energy source.

Deployment Won;t Necessarily Lead to Lower Costs

I agree with the commenter that noted how foolish it is to subsidize deployment of storage technologies that are not ready for commercialization.  Efficient supply chains are not the problem.  Some technologies like pumped storage do not get cheaper with scale production.  Others, like batteries, haven't proved their longevity, but there are all sorts of ideas floating around for improving some of the basic chemical formulations.  It makes sense to move those ideas forward before deploying a bunch of costly white elephants.

Making storage viable isn't simply about spending money in hopes something good will happen.  It's about spending money in smart ways that advance the state-of-the-art so that scale deployments are successful.

Jack Ellis, Tahoe City, CA

Next Five Years Crucial to Energy Storage

The US electric system has a load factor of under 50%.  Said another way, if consumers could even out consumption over a 24 hour period, our generation abilities can provide twice as much power as is needed. Of course even consumption is not possible.  Most of the peak that does occur, and requires generation and transmission to expand, is due to air conditioning.

Air conditioning is one of the easiest loads to move, and when you do move the cooling load, the energy is stored.  It is a form of energy storage!  Energy storage for cooling has been around a long time. Estimates tag cooling to be responsible for over 40% of  peak demand,  Energy storage for cooling, ice or water, is reliable and it is affordable, yet it is never mentioned in the same breath as electric storage.  It costs a less to store a btu than the electron required to create it!  Thermal energy storage (TES) should be mentioned and included in any storage discussion because it is reliable, dependable, dispatchable, and affordable.  Even with these attributes, TES is overlooked.

Nighttime charging of cooling storage uses efficient clean night time generation reducing source fuel consumption in most cases.  Nigttime charging of cooling storage provides a load for west Texas wind farms and others, for example, where the wind blows more during the night time.  Daytime discharging of cooling storage lowers demand and can kick in to help support PV generation on cloudy days.

Just in time consumption of electricity for cooling is waste of capital and generation and transmission resources.  Thermal energy storage is affordable and reliable and lasts for 30 years or more, but it is not "sexy" enough to be mentioned with batteries and other technologies.  This thinking is very shortsided.  TES could shift a large portion of summer, spring and fall consumption.  Other storage technologies will of course be needed but please don't forget about TES!

Use of taxpayer money

I still have difficulty seeing how we can justify giving taxpayer money to private companies to deploy technology that is not fully developed.  I can see using taxpayer dollars to support R&D that gets an energy technology developed and optimized then either sells that technology to the highest bidder or gives it to all participants in the particular field for them to compete with each other over deploying.  That is what the space program and military research programs did for the country--came up with new technological advancements that entrepeneurs or established companies turned into products that were in demand or that increased efficiency of generating power.  Giving money to firms to make up for the difference in the economics of their technology versus existing technology will, I believe, slow the pace of developing the technology because the firms will be more intent on putting out uneconomical technology in order to get the tax credits or cash grants--and unfortunately opens the door to fraud as the developers or the producers of the equipment may inflate the costs in order to get more grant money.

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