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Summary:

There are only a little over 500 deployed energy storage projects in the world, according to Pike Research. So what’s the hold up? Here’s three hurdles facing energy storage grid projects.

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There are only a little over 500 deployed energy storage projects in the world, according to Pike Research. Energy storage technologies include things like battery farms, compressed air storage (pushing air into a container and letting it out) and pumped hydro (pumping water up a hill and then letting it flow back down).

The sector is emerging, and grew just 8 percent over the first half of 2012, says Pike. While there are now 649 energy storage projects that have been announced, of those, there are only 514 projects deployed.

So what’s the hold up? Energy storage has long been considered the key to adding more clean power onto the grid. Because solar and wind only generate power when the sun shines or the wind blows (called variable energy) they need to be connected to energy storage projects to level out that generation. Storage projects can bank, say, the extra power from a wind turbine on a windy day, and then release that energy when the wind stops blowing. Power companies can also use energy storage projects to better manage the grid for a variety of applications.

According to Pike, here’s three reasons for the slow moving sector:

1). The technology is still too expensive: The costs vary a lot between different types of energy storage technologies. Pumped hydro is one of the cheapest forms, as is compressed air energy storage, but lithium ion batteries are far more expensive. A report from EPRI last year found that if energy storage prices dropped to $500 per kilowatt hour that could boost the market.

2). The market is overstated: There are more projects that have been announced — and are even inactive — than are deployed. Some of these announced projects might not ever get built. Inflating the market isn’t good because it creates hype around a sector that still has substantial hurdles.

3). Advanced energy storage tech is dependent on government support: Many of these projects have relied upon government support in terms of grants. The flow battery project in Modesto that I detailed this week is being built with a Department of Energy grant.

  1. By using existing tech in innovative ways to make a hybrid energy storage system, these three problems go away. A strong business case can be made for a user definable, modular hybrid ESS. Finding the money to develop this is difficult due to the investments in new technologies that require years of testing, validation, investment support, raw material acquisition, manufacturing ramp-up and then sales. Like my dad said, Keep it simple stupid

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  2. As the grid is operated now – take ERCOT for example, storage projects are specifically not allowed to do what their value is – take cheaper power and time shift to provide at highest need/cost. The generators object to storage – one estimate is that traders cost the public 10% of their costs because they can trade on the unknown – storage provides stabilizes energy demand and production… the bets go away.

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  3. Not a true statement.

    “Because solar and wind only generate power when the sun shines or the wind blows (called variable energy) they need to be connected to energy storage projects to level out that generation.”

    Very, very, very little of the deployed solar and wind on the grid today is connected in any way to energy storage and there is no indication that this is will ever be necessary.

    Connecting energy storage to the grid to help manage power flows, with or without variable generation, may indeed prove to be a better option than using conventional generators which perform this task today. As variable generation increases, this option may become increasingly more attractive and lead to more deployments. But the statement in this article is an oversimplified, and easily fact-checked, myth.

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    1. @Guest, By need to be connected, we mean should be connected for best value. I didn’t state that they are currently mostly connected. Thanks for “fact-checking” this article though.

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  4. Susan Kraemer Wednesday, July 11, 2012

    I don’t think that the need for government support should be implied is a bad thing. The transcontinental railroad to bring coal to coal plants near cities took government support. Rolling out the interstate highways took government support. The oil industry and the coal industry may seem invincible now, and they can now afford to self-fund their own innovations. But when oil was first drilled it cost $500 a barrel. Any huge change in energy took government support to begin with.

    Renewables, and the storage to bring them to mass use, are big changes, involving supporting technologies, like coal (which needed publicly funded railroads) and oil (which needed publicly funded roads to drive cars on) were back then.

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  5. Richard J Mowat Friday, July 13, 2012

    Their have been huge breakthroughs with one of the most expensive questions.. The cost.

    The membranes and cell stacks are the most expensive parts of the flow battery systems for instance.

    Companies are talking about a 80% reduction in these 2 costs which will bring the cost of large flow battery systems down exponentially. I believe the vanadium redox flow battery is the leader in the race for mass storage devices that are economical.

    This is a great article from American Vanadium Corp covering the topic of grid energy storage systems.

    http://www.americanvanadium.com/grid-energy-power-storage.php

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