Storage: The Best Renewable Energy Integration Strategy?

In order to electrify transportation, well need batteries, with ultracapacitors and compressed air playing supporting roles. Based on cost, John Petersen has been making the case that the batteries for economical cars are more likely to be advanced lead-acid (PbA) than the media darling, Lithium-ion (Li-ion.) I generally agree, especially since recycling Li-ion batteries is an expensive and difficult process, although I see a future where both cars and oil are simply more expensive, and we have far fewer of them.

But transportation is only one application for energy storage technologies. Another is matching the electricity output of variable power sources such as wind and solar with demand, as well as providing standby power to accommodate sudden ramp-ups and ramp downs.

Storage for Grid-Tied Applications

Below is a chart I put together comparing the cost per kW (Power), cost per kWh (Energy) and Round-trip efficiency of a large range of technologies. Both axes are log scale. This slide will be part of a presentation I'll be giving at Solar 2009 on May 15th. (I'll also be on this panel on the 13th.) Technologies to the right can store energy cheaply, and are the best for matching variable energy output with demand. Technologies near the top deliver high power at low cost, and so are best for accommodating sudden changes in supply or demand on the grid. Larger bubbles represent higher round-trip efficiency, meaning that more of the stored power can be sent back to the grid.

There are many other important characteristics of storage technologies, such as cycle life, O&M costs, memory effects, response time, and size / weight, so the technologies which look best on this graph will not be the best for all applications.

Click to enlarge

Batteries: Mostly for Cars

It's easy to note that lead-acid batteries dominate Lithium-ion batteries for grid tied applications: In a grid-tied application, the light weight of Li-ion batteries no longer makes any difference, and cost is much more important. More important, however, it's also easy to note that neither the battery nor flow battery technologies are truly dominant in this context (note that I've lumped hydrogen electrolysis / fuel cell combinations (H2) with flow batteries in this context. The bubble hidden behind NaS is ZnBr, a Zinc-Bromide flow battery, being commercialized by ZBB Energy (ZBB).)

If I'd done this research a few years ago, I never would have recommended Vanadium Redox flow batteries (VRB) or Sodium Sulfur (NaS) in 2007, although a quick look at the chart makes clear why NGK Insulators (NGKIF.pk) is still selling NaS batteries while VRB Power declared bankruptcy not long after I sold it: NaS batteries produce much more power at the same cost. They also have the advantage (not shown here) that they are small enough to be moved, and so can be used to defer transmission and distribution upgrades in multiple locations over the life of the battery.

Lead Costs More than Salt, Water, or Air

When it comes to dealing with the large scale power for grid tied applications, the best technologies are the ones with the cheapest storage media. Thermal storage molten salt, while pumped hydro [PHES] uses water, and Compressed Air Energy Storage [CAES] uses air. Demand Response and Transmission do even better by shifting power use in time or space, and dispensing with a storage medium altogether.

The primacy of Demand Response and Transmission should not come as any surprise to regular readers, who will recall that Demand Response was the hero of the Texas Wind incident, while Transmission compares favorably to most storage technologies because it diversifies away many of the ups and downs of variable electricity supply and demand.

Pumped Hydro vs. Thermal Storage vs. CAES

Transmission is unfortunately difficult to permit and build, and demand response can only be used a few hours a year (at least until we get more responsive demand through smart grid investment.) This means that there will continue to be a large need for the three other forms of large scale, cheap energy storage. Unfortunately, all three can only be used effectively in special situations. Pumped hydro requires two adjacent reservoirs with a vertical drop between them, Thermal Storage works best with Concentrating Solar Power plants, especially in the tower configuration, and CAES requires an underground, air-tight cavern.

While reservoirs and caverns can be built, doing so erodes the economics of the technologies. It's worth noting that the economics of pumped hydro vary widely depending on the location, and so the apparent advantage of CAES only holds in some cases; the locations of the bubbles are based on averages of the highest and lowest costs in the literature.

Investments

For investors who see opportunity in integrating renewable electricity into the grid, the media fascination with battery technology is an opportunity. They should focus on Demand Response and smart grid stocks such as EnerNOC (ENOC), Comverge (COMV), Itron (ITRI), Echelon (ELON), Telvent (TLVT), and RuggedCom (RUGGF.PK), Transmission stocks such as ABB Group (ABB), Quanta Services (PWR), General Cable (BGC), Pike Electric Corp (PIKE), ITC Holdings Corp (ITC), and Siemens (SI), before investing in traditional storage plays.

In many ways, this is fortunate, since Pumped Hydro, Thermal Storage, and CAES are all difficult for a stock market investor to get exposure to.

DISCLOSURE: Tom Konrad or his clients have long positions in ENOC, COMV, ITRI, ELON, TLVT, RUGGF, ABB, PWR, BGC, PIKE, ITC, and SI.

Comments

[richpee:]

Still no one is wworking on the Natutal gas conversion of cars vs trying to go to battriesd forcing the barrey upon cionsurmers..when ooooooAmerica Gas companie shave just reported 2 new gas discoveries one larger than 100 year saplus to serve all of America's convirted oil useage for heating cars trasportation etc. if America woudl just convirt to gas..WHY ISN"T OBAMA doig that whjy aren't we as a country and our businesses smart enought to do this>>WQHY WHY??

May 12 08:58 AM

[JOLLYGOOD:]

WHAT ABOUT ENS?

May 12 09:20 AM

[William Taylor:]

And Tom, does BCON have a role in all this? And, if so, what might it be? I believe it has certain advantages, (low carbon footprint, long life, fast resonse time), over other grid regulation systems. They are talking about wind and solar integration systems in their annual report. Any thoughts on flywheel tech?
Enjoy your writing. Thanks!

May 12 10:34 AM

[John Lounsbury:]

Excellent article, Tom. I second William Taylor's question about mechanical storage (flywheel). Also, WT mentions integrated technology generation systems. Any thoughts on integrating technologies for leveling production fluctuations?

May 12 11:57 AM

[kwaq:]

... at least for the vehicle mass market you have a better compromise than Lead vs Li-ion its name is NiZn technology. And honestly if you let the Li-xx lobbying beside... you might have a pretty good solution (safety, renewable, cheaper). And obviously industrialization is under process. Furthermore you might also use Li-xx technologies for high range cars.

May 12 01:59 PM

[Tom Konrad:]

Beacon's Flywheels are more a Power resource than an Energy resource... they are best for frequency regulation, which is keeping the very short term (seconds to minutes) energy fluctuations in balance. On this chart, flywheels would be off the top of the chart and to the left of demand response, but they don't really fit into the discussion because they are not particularly useful for the problems I'm talking about. Still VERY useful, but not for solving these problems, which require power for 15 min to a few hours.


On May 12 10:34 AM William Taylor wrote:

> And Tom, does BCON have a role in all this? And, if so, what might
> it be? I believe it has certain advantages, (low carbon footprint,
> long life, fast resonse time), over other grid regulation systems.
> They are talking about wind and solar integration systems in their
> annual report. Any thoughts on flywheel tech?
> Enjoy your writing. Thanks!
>
>

May 12 05:29 PM

[crtoca:]

Don't count out the vanadium redox battery (VRB). VRB Power is out of business but the technology was picked up by a larger company with deeper pockets - which any emerging technology absolutely needs. Utility-Savings for more details. So you can recommend the technology again.

Regarding "cheap" storage media, don't forget the poor round-trip efficiency of molten salt and the true costs of trying to site pumped hydro and CAES. Environmental concerns and the very specific locational requirements make pumped hydro and CAES very iffy. And include the round trip efficiency of CAES - including the need to burn natural gas - and distributed advanced batteries like NAS and VRB make sense. The price will come down with economies of scale.

May 12 08:29 PM

[Alan Young:]

Tom, I appreciate your comprehensive view.

Since GE has just announced big plans for manufacturing NaS batteries for grid applications (notably, wind power storage), does that change your interpretation of priorities?

May 12 11:26 PM

[Wisdom vs. ...:]

not to put put words in T's mouth but: NaS storage costs $3-4 THOUSAND/kWh, big ouch. is ge sanbagging, like they did on the windturbines-- get big subsidies, then introduce 1mW generator? well, if history repeats... (long GE)

May 13 09:23 PM

[Wisdom vs. ...:]

OOPS. NaS storage is ~450$/kWh. quite a bit more than PB, but a lot less than Li, its cousins and flywheels

May 14 01:07 PM

[Tom Konrad:]

This analysis is focused on grid-tied applications. GE is planning on building NaS batteries for large electric vehicle applications, where the most important factors are energy density and cycle life, which are not shown in my graph. NaS beats Litium ion and NiMH batteries for cost per kWh, so if energy density and cycle life are also superior, this should be a good bet for GE.

NaS batteries are reputed to have excellent cycle life, but I'm not sure about energy density.


On May 12 11:26 PM Alan Young wrote:

> Tom, I appreciate your comprehensive view.
>
> Since GE has just announced big plans for manufacturing NaS batteries
> for grid applications (notably, wind power storage), does that change
> your interpretation of priorities?

May 28 02:20 AM