The market demand for grid storage of electrical power will skyrocket over the next five years, spiking from about $2.8 billion in 2012 to $113.5 billion in 2017, according to a new study from Lux Research Inc.
The study highlights the fact that as renewable power grows, utilities and commercial sites will one day need large back-up facilities to supply energy when the wind's not blowing and the sun's not shining. "In most regions, intermittent renewables will need to have some type of storage or new infrastructure if they're ever going reach huge numbers -- 10 percent or 20 percent or 30 percent of our overall power," Brian Warshay, lead author of the new study and a research associate for Lux Research, told us.
Battery farms can store energy in low-megawatt capacities. (Source: Electric Power Research Institute)
The report, "Grid Storage Under the Microscope: Using Local Knowledge to Forecast Global Demand," contends that five countries -- the US, Japan, China, UK, and Germany -- will account for about 70 percent of that overall demand. The US will be the biggest of those, with a demand of more than $20 billion per year by about 2017.
The study reinforces what many experts have said in recent years -- that wind and solar will hit sticking points when they reach a level between 10 percent and 20 percent of the country's overall electricity production (currently, the two compose about 4 percent to 5 percent of the electricity produced in the US). The reason is that wind and solar are intermittent sources -- that is, they produce electricity only when the wind is blowing and the sun is shining. Since, in most cases, electricity is consumed moments after it's created, wind and solar would require back-up storage to prevent rolling brown-outs and black-outs.
Lux's study looked at the use of emerging technologies, such as batteries and flywheels, for use in grid energy storage. Candidate technologies included lithium-ion batteries, advanced lead-acid batteries, molten salt batteries, flow batteries, and flywheels. Most of those technologies would be used in giant warehouses containing about 10MW to 100MW in battery capacity, Warshay said. "We don't foresee a lot of centralized, large-scale, gigawatt-level storage," he told us. "We see it happening in tens and hundreds of megawatts, where it makes sense."
Warshay added that those smaller-scale systems could be employed on the community level, for storage of wind and solar power, or on the commercial level. "Commercial systems pose an exciting opportunity for storage, especially in industries that have a high demand for reliable electricity," he said. "Companies at risk of losing a lot of money during a brown-out or black-out would be candidates for this." Such companies might have onsite storage facilities designed to take up the slack during black-outs, he said.
Thanks for clarifying, Chuck. So we have some time to build out the grid storage and Naperlou talks about how it can be accomplished pretty effectively. I am by no means trying to poke holes in this development. As with all of this alternative fuel and renewable energy technology, it's a process and it's going to take time, money, and innovations in order to pull us over the goal line.
Beth, I should have been more emphatic in stating that this is about the demand, not about what will actually happen. Lux's study is looking at plans, such as those in California (which wants to boost its renewables over 30%) and saying, "here's what will be needed." You're correct on all counts: yes, construction of these facilities will take money (public or private) and, yes, these storage centers will be very large. As for whether renewables will hit a brick wall without it: Yes, they will. The question is, when? Today, wind and solar generate about 4-6% of our electrical capacity. Experts at Argonne National Laboratory say that we will need storage when we reach a point between 10% and 20%.
Beth, it's not as bad as all that. By using grid storage utilities can avoid building or upgrading other generation capacity. Thus, it may not be a big extra expense in the long run. In addition, this technology offers a way to make the grid more reliable. I have seen plans for batteries at the substation level. We'll have to see how the battery technology pans out.
The opposite side of this is manipulating the demand side. Some utilities are now pushing 'smart' meters and appliances that will give the utility the option of reducing your consumption at peak load times. That may influence some customers to install small at-home back-up systems. Right now the savings are not enough for me to give the utility control over my appliances. And I don't think a UPS can be had for the saving offered either. Plus there would be the difficulty of how to wire / control such a system.
Interesting post, Chuck. But the need for grid storage and the requisite infrastructure to support it seems to me to have the same limitations and issues as the charging infrastructure dilemma you've been writing about lately with EVs. Building out the grid storage will take money and physical space, correct? I'm imaging it like giant data centers all over the place, so please set me straight. Will this be funded by private industry, the government? And without it, what happens to the use of renewable energy--it hits a brick wall.
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