The Future of Renewables Storage
Previously, my colleague Mark noted that pairing storage with solar generation was, literally, a game changer for solar. This is because, as he wrote, “in many markets, electricity demand tends to spike just as the sun sets (as it happens, there’s no way to turn the sun “on”).”
While we can’t turn the sun on, we can store its energy - something we’re doing more of, and more efficiently, every day. Industry analysis shows that the total deployments of storage - as measured in MWh - nearly tripled in 2021 compared to 2020 (according to Wood Mackenzie), while over the same period, the cost of deployments was reduced 10-15% when adjusted for shipping costs. This represents an annual market of over $7 billion.
Further, this trend will likely continue: storage deployments are forecasted to increase 15x from 2021 to 2030.
Storage has momentum, clearly, and it’s worth taking a moment to talk in a little more detail about what exactly we’re talking about when we say “storage”, particularly in the context of renewables.
First, the dominant “storage” solution today, and the one we most commonly recommend, is Lithium-ion (Li-ion) batteries. These are similar in technology to the batteries in electric cars, buses, battery-powered hand tools and cell phones. Through the end of 2019, more than 90% of the large-scale energy storage facilities in the United States use Li-ion batteries.
There are a few notable differences between Li-ion and the lead acid battery under the hood of your car. The most obvious is weight: for the same capacity, Li-ion weighs significantly less. This superior energy density means more energy can be stored in the same space. More importantly, the properties of Li-ion batteries are such that they can be nearly completely drained of their capacity and recharged again without diminishing its performance. This is not true of lead acid batteries, which as a rule cannot be discharged past 50% of their capacity without diminishing performance and life expectancy. Efficiencies show up in terms of energy availability, too: whereas roughly 80% of the energy available in lead acid batteries is available for use, nearly 95% of the energy in Li-ion batteries can be used.
All told, the advantages for solar - the space and energy efficiencies, coupled with the ability to deeply discharge without negatively impacting performance - make clear why Li-ion batteries are the most popular technology at utility-scale solar plus storage installations.
It is also worth noting that while the specific Lithium-ion chemistry of these batteries contributes to their cost and performance. Lithium-ion batteries typically use Lithium Iron Phosphate (LFP) or Nickel Manganese Cobalt chemistry. NMC batteries are typically used in smart phones and electric cars as they are slightly more energy dense (smaller and lighter for the same power). LFP batteries are heavy but cost less and have slightly better operating parameters, so they are a good fit for large-scale energy storage systems. Interestingly, LFP batteries are also a good fit for electric buses where space is not an issue compared to electric passenger cars.
Battery management technologies - in particular, the software that can be used to optimize their performance - also play a key role in maximizing storage performance. This is similar to the battery management program in most smart phones. The software continuously measures the battery health and charge level and adjusts the charge and discharge rates to maximize battery life and efficiency. For large utility storage projects, the software can optimize the state of charge and health of each of the thousands of individual battery modules by shifting energy across the modules. This improves performance and extends the life of the overall system.
Which is to say, understanding the best storage solution for a particular project isn’t quite as straightforward as simply picking the “best” battery. Multiple factors come into play including the dispatch profile, the number of cycles per year and the annual average state of charge. These are all different between a large scale battery system designed to shift energy 3-9 hours daily to provide a flat production profile from a solar project compared to a standard battery system that is designed to quickly charge and discharge to take advantage of price fluctuations in the power market or provide ancillary services to the grid.
However, development of other storage technologies continues to accelerate, and there is no guarantee that Li-ion will always be the dominant solution. At Candela, we are monitoring innovations in energy storage, and there are some genuinely fascinating technologies coming to market:
Kinetic Storage: If Lithium-ion batteries store energy using chemistry, kinetic alternatives do it with old fashioned physics, and in particular, gravity. What this actually looks like may strike one as something out of a Roadrunner cartoon (Imagine a hundred foot tall tower comprised of 35 ton composite bricks, with energy released as the bricks are lowered to the ground). This technology is best suited for extremely longer duration storage, more than 1-7 days as energy is not lost while stored.
Molten Salt: In general terms electricity is used to move energy from a cold source to a hot source (molten salt) using a heat engine. The process is reversed to generate electricity. A special blend of liquified salt is used to store the energy. The technology is also called a “Brayton battery” as it uses the thermodynamic cycle known as the Brayton cycle which is the basis for the gas turbine. This system is expected to be used for long-term energy storage. It may also have extra value at industrial facilities which produce waste heat that is typically dumped to the environment. This heat can be stored and used to make electricity when needed.
Liquid Air: Uses electricity to cool air to -320 °F, which turns it into a liquid that can be stored in insulated containers. When electricity is needed, the liquid air is allowed to vaporize, at ambient temperature, and expands by ~700 times through a turbine to generate electricity. And, the byproduct of this process is… air. This system is intended for long-term energy storage and may also support electric grids that need rotating equipment for frequency support or black start capabilities
Iron Air: Is a different type of chemistry-based battery that uses iron, water and air to store energy for 100 hours or more. This technology has received significant interest as it has a very low projected cost with minimal environmental impact compared to mining lithium and other chemicals used in Lithium Ion batteries.
As the cost of solar generation continues to fall, and storage technologies simultaneously advance (reducing round trip efficiency losses, extending storage duration and overall costs), our ability to realize a truly carbon neutral electricity grid is a lot closer than many people might think. Because Candela is technology agnostic, as storage evolves, we’ll evolve with it - and make certain our projects have access to not only the most advanced storage solutions, but the storage solutions that are right for their specific application.
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