Compressed Air, Energy Storage, Renewables

Energy Storage: Thinking BIG

The widespread deployment of cost-effective, grid-scale energy storage solutions may still be distant, but the technology appears to be commercially viable. The next step: Getting projects funded and online.

Storing electricity on a large scale has been pursued for years by electric utilities in hopes of using the power to cover periods of peak demand. The ability to store large amounts of power will help power producers fill the production gaps created by growing amounts of intermittent generation such as solar and wind power.

After years of limited progress, several capable systems for storing large amounts of power have emerged from research and development efforts borne from new mandates for energy storage capacity and public demand for cleaner power supplies. Some grid-scale systems are viable now, while others are on the verge of viability.

The progress in energy storage technology is reflected in last year’s development efforts. According to a report by GTM Research and the Energy Storage Association, the U.S. deployed 221 MW of new storage capacity in 2015, up 243 percent over the previous year. By 2020, energy storage capacity in the U.S. is projected to reach 1.7 GW valued at $2.5 billion, the report showed.

“We can look back at 2015 as the year when energy storage really took off,” said Ravi Manghani, the report’s author. “While most of the growth was limited to a single wholesale market of PJM, we expect growing interest for storage in several markets.”

Spawned by the recent extension of the federal Investment Tax Credit (ITC), GTM expects the U.S. will add half a GW of storage capacity between 2016 and 2020. This added capacity will be coupled with renewable power projects, beneficiaries of the 30 percent tax credit. Of the additional storage driven by the ITC, most of that capacity will be utility scale, GTM said.    

While most of the attention is paid to the development of the next-generation system of battery storage, the granddaddy of all energy storage projects will rely on another form of storage technology – compressed air – and will be built in the high desert of rural Utah. In this issue of Power Engineering, our cover story examines the history and the technology behind this grand project – the $1.5 billion Intermountain Energy Storage Project.

The Intermountain project is the largest of its kind, using wind power to store large amounts of compressed air in four underground salt caverns, each capable of storing enough high-pressure compressed air to fill the Empire State Building.

“Whenever energy storage comes up these days, everyone talks about chemical batteries,” said Robert Schulte of Schulte Associates LLC and a consultant to Burbank Water & Power, one of the project’s developers. “In certain cases, chemical batteries can supply as much as 20 MW, but the project at Intermountain targets 1,200 MW of storage or more.”

If the project is realized, it will serve as a litmus test for how power producers can use energy storage to deal with growing amounts of intermittent generation, grid integration costs, and stricter emission standards. It will also serve as a testing ground for the benefits of compressed air energy storage technology, especially its ability to absorb excess renewable generation and reproduce it when that power is needed.

Meanwhile, energy storage costs have been declining rapidly and will continue to fall. The market for large scale energy storage technologies received a big boost in October 2013, when California adopted the nation’s first energy storage mandate. The measure requires the state’s investor-owned electric utilities to buy 1.3 GW of energy storage capacity by the end of 2020. The California mandate has accelerated the development of storage technologies and efforts to bring costs down.

In January, the World Energy Council (WEC) said in a report the associated costs of energy storage technologies will fall 70 percent by 2030, which will lead to strong growth in the global adoption of energy storage.

But the adoption of energy storage should not be determined solely on cost. Energy storage is seen by many as a game changer for the power sector. Its flexibility could help utilities and grid managers bring more balance to supply and demand, making the grid more resilient and efficient.  

As the WEC noted in its report, focusing on the “levelized cost” of storage can be misleading because the metrics used to determine the levelized cost are arbitrary. Energy storage should be viewed as an essential component of grid expansion. “A narrow focus on costs alone drives the common misperception that energy storage is more expensive than it really is,” the WEC wrote.

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