A startup building the next-generation of compressed air energy storage, SustainX, has raised a new round of funding from investors including GE Energy Financial Services, a division of GE. In an interview this week, SustainX CEO Thomas Zarrella and founder Dax Kepshire told me that by the middle of next year, the company will start construction on a 1 MW compressed air energy storage project, likely at a coal plant, in conjunction with power company AES, its first customer.
Compressed air is a decades-old technology which takes excess energy from a power plant or renewable energy and uses it to run air compressors, which pump air into tanks or underground caverns where it’s stored under pressure. When the air is released, it powers a turbine, creating electricity. There’s only a handful of compressed air energy storage projects in the world, including one in Alabama and one in Germany.
But there’s a new group of startups building the next-generation of this technology, including SustainX and competitor General Compression. A key to the new technology is a water spray that keeps the air at a constant temperature through the compression and storing process. In January SustainX announced a patent for that technology, and says it holds three patents around its technology. SustainX’s Kepshire says the company uses off-the-shelf parts and can offer energy storage at a disruptively low cost.
SustainX has already built a 40 kW project at its headquarters in West Lebanon, N.H., which Zarrella said has proven the technology. To build the pilot, the company has now raised $14.4 million from investors including GE, Cadent Energy Partners, RockPort Capital, Polaris Venture Partners, and Angeli Parvi. In late 2009, the Department of Energy awarded SustainX a $5.39 million grant to help it reach that commercialization goal.
General Compression has been working on a similar technology, and says its technology has a 70-75 percent round-trip efficiency. Because the units can respond in less than 30 seconds and cycle between compression and expansion quickly, they could be used to back up wind farm power output, which is the company’s main focus. General Compression also raised a $17 million Series A round of funding and $9.9 million back in 2007. Investors include US Renewables Group and Duke Energy, a utility with a lot of wind power to back up.
After these two companies commercialize their technologies, we’ll see how widely power companies will adopt the tech. The idea is that compressed air energy storage can be cheaper — over the lifetime of the system — than other energy storage options like batteries, and SustainX estimates the market for grid-scale energy storage will be $18 billion by 2015.
Image courtesy of SustainX.