Energy Storage, Part Two: Dealing with the challenges and limitations of energy storage systems

by Prasanna Srinivasan, Manager, Business Development & Marketing at LORD Corporation 

Prasanna Srinivasan, Manager, Business Development & Marketing at LORD Corporation
Prasanna Srinivasan,  Manager, Business Development & Marketing at LORD Corporation 

It’s no secret that the U.S. electrical grid system is overtaxed and outdated, and integrating methods to decrease dependence on it is critical. Modernizing the system will help position the country to meet future projected energy needs and reduce the electric load. By some estimates, the U.S. will need somewhere between 4 and 5 terawatt-hours of electricity annually by 2050.

There have been tremendous breakthroughs and continued growth in the energy storage market, which can play a significant role in expanding the grid to handle an increased load and improve operating capabilities.

Energy storage systems (ESS) can also support emergency preparedness efforts, reduce the need for major new transmission grid construction upgrades and augment the performance of existing transmission and distribution assets.

The U.S. Department of Energy (DOE) recognizes that by reducing peak loading (and overloading) of transmission and distribution lines, storage can extend the life of existing infrastructure.

Despite all these factors in favor of energy storage, several challenges remain, including:

Multiple technologies: There are multiple energy storage technologies – chemical and non-chemical categories of storage – and a lack of convergence with lithium-ion (Li-ion), flow batteries and non-battery solutions such as mechanical or thermal storage.

System costs: Overall system costs also must be considered because a single solution may not be applicable across the board. Instead, a different approach may be needed for various regions and system architectures to make energy storage economically feasible. Energy storage system technologies need to be cost competitive, but they are still in the early stages. Costs will come down as companies begin optimizing these ESS technologies. This includes the price for Li-on batteries, which currently dominate the market. This elevated demand is driving production and affecting the price.

However, costs are coming down, particularly in light of the progress that has been made in terms of electric vehicles. As large-scale batteries reach economies of scale, the cost reduction will also translate to energy storage.

Safety concerns: Various safety concerns, such as how batteries of different chemistries and technologies react in a fire, exposure to toxic fumes, how responders handle a damaged battery that still contains energy and hazards associated with energy storage systems, among other safety issues, present their own set of challenges.

Regulatory barriers: Institutional and policy barriers pose challenges with energy storage. What rules and regulations will be put in place? How storage systems in various markets will be regulated and what cost-based and market-based, cost-recovery for owned or contracted energy storage assets need to be determined. California may lead the way. In mid-February, the California Senate introduced a bill that would require the state to make 100 percent of its energy from renewable sources by 2045.

Thermal Storage Tanks were installed as part of an energy conservation construction project for Naval Submarine Base Kings Bay.

Thermal Storage Tanks were installed as part of an energy conservation construction project for Naval Submarine Base Kings Bay. Source: Flickr

Currently, guidelines are being drafted in Australia that may ban lithium-ion battery storage devices from being installed inside homes and garages, allowing them only in in free-standing “bunkers.”

This would not only affect everyday consumers, one of whom is Australia’s prime minister, but it also could also affect large-scale installations. If the ban is implemented, it could pose issues for people who have electric vehicles, which are powered by Li-on batteries.

However, Elon Musk, Tesla Motors CEO and chairman and founder/CEO of SpaceX has been in the news for boldly suggesting to the Australian government that he could solve a looming energy crisis in South Australia – which has experienced blackouts the past few months – through ESS. Musk said that he could install a battery system within 100 days or it would be free.

Strategy in approach: Strategic issues challenge energy storage. How do you develop a systemic or a holistic approach to senergy torage that addresses and bridges technical regulatory and market and political aspects? Determining a strategy incorporating these various silos is important. Developing a pricing model around vehicle-to-grid (V2G) – using batteries in electric cars as grid storage devices – and other related challenges must also be strategically addressed, especially because V2G storage requires such an extensive infrastructure.

INL Energy Systems Laboratory

Idaho National Laboratory (INL) Energy Systems Laboratory is the research and development technical leader for developing bio-energy feedstock supply systems, important to renewable energy portfolios. In July 2013, the Department of Energy designated INL’s biomass feedstock research effort as a national user facility. Source: Flickr

Consumer acceptance: The idea of energy storage may be attractive and exciting, but here are some unknowns. For true acceptance and adoption of ESS, consumers need to understand the how and why of energy storage and be able to validate the safety, reliability, and performance of these systems.

Even with these limitations and challenges, the energy storage market is ultimately situated to grow very rapidly. Learn about it and plan for it, but expect the automotive market to actively take the lead in resolving many of the issues and challenges with energy system storage technology.

Let LORD know how you are planning for the rise in energy storage and your thoughts on the market.

Click here for “Energy Storage, Part One: Are energy storage systems the next big thing?”

Energy Storage at a Glance

To get a picture of how energy is being consumed through the United States and more about the energy storage market, check out the interactive U.S. Energy Mapping System and the 2017 Energy Outlook from the U.S. Energy Information Administration (EIA).

 

 

 

Energy Storage, Part One: Are energy storage systems the next big thing?

by Prasanna Srinivasan, Manager, Business Development & Marketing at LORD Corporation

Prasanna Srinivasan, Manager, Business Development & Marketing at LORD Corporation

Prasanna Srinivasan

Energy storage is not a new concept. It has been around for decades and is touted as an important tool for facility managers to optimize their facility energy system, a solution to fixing the aging power grid and increasing the spread of renewable energy. It has been a valuable tool for reducing electric bills and helps during emergencies such as power outages from storms, equipment failures or accidents.

The energy storage market is positioned to “explode” to an annual installation size of 6 gigawatts (GW) in 2017 and more than 40 GW by 2022 from an initial base of 0.34 GW installed in 2012 and 2013. Analyzing energy storage from a monetary standpoint, it is expected to grow 8 percent a year to $50 billion in 2020.

The federal government has also committed to increasing energy storage and microgrid capacity, further promoting expansion of this market. In June 2016, the White House announced a series of federal and private-sector actions to scale energy storage in the U.S. at the Summit on Scaling Renewable Energy and Storage with Smart Markets.

These factors, among others, are contributing to this rapid market expansion.

  • The growth of the electric vehicle (EV) market. The International Energy Agency says electric car stock reached 1.26 million in 2015, 100 times more than in 2010. New registrations of electric cars increased by 70 percent between 2014 and 2015, with more than 550,000 vehicles being sold worldwide in 2015. EVs could impact the energy storage market through vehicle-to-grid technologies, through which their batteries could be connected to the grid to discharge power for others to use.
  • energy-storage-system_806162026_838efa77e6_z

    Energy storage systems are expected to grow to an annual size of 6 gigawatts this year and to more than 40 gigawatts by 2022. Source: Flickr

    The progress of Lithium-ion (Li-ion) battery technology. Li-ion batteries have ramped up in terms of energy and power density. Throughout the next decade, Li-ion batteries are expected to become the mainstream energy-storage technology, and more than 80 percent of global energy storage installations will include the technology by 2025.

  • Abundance of untapped resources. Energy storage makes it possible to take advantage of solar energy, even when the sun isn’t out, and wind power when there isn’t wind. Energy storage systems are able to help smooth out the electricity supply from variable energy sources such as these.

wind-energy-graphic-from-prasanna

  • Push for cleaner energy and energy independence. The intense focus on this, along with some government subsidies, has propelled the market forward. Energy storage not only supports the integration of renewable energy generation, such as wind and solar power, but it helps cut emissions as it takes more of the load off fossil-fuel generation. Making existing generation go further and avoiding capital and resource-intensive new facilities would make a significant contribution to environmental priorities. California’s Santa Rita jail in Dublin, Calif. – the fifth-largest correctional facility in the United States – has embraced energy storage, developing its 113 acres into a modern microgrid. The jail is now able to meet its own power needs in case of a utility grid outage. This is a game-changer because the facility now has the ability to balance power supply and demand instantaneously – literally within milliseconds – making power networks much more resilient, efficient and cleaner than in the past.
  • Big names have jumped on board with energy storage. Grid companies have started working with battery pack integrators to provide a smart grid, and solar companies are partnering with battery suppliers. The automotive industry has also readily adopted energy storage to help accelerate development of high-performance, cost-effective, and safe energy storage systems to power the next generation of electric-drive vehicles, cut greenhouse gas emissions and reduce the need for the U.S. to import oil.

Energy storage at a glanceAlthough the energy storage market is rapidly expanding and provides numerous opportunities, there are still kinks that must be worked out before it can be fully adopted on a mainstream level.

For more on challenges and limitations facing the energy storage market, look for an “Energy Storage: Part 2” follow-up to this blog post. In the meantime, let us know your thoughts on the future of energy storage.

To get a picture of how energy is being consumed through the United States and more about the energy storage market, check out this interactive “U.S. Energy Mapping System” and the 2017 Energy Outlook from the U.S. Energy Information Administration (EIA).

energy_storage_growth_chart_ihsm2_0.png