For everyone counting on renewables to replace the pollution and carbon emissions of fossil fuels, energy storage has been the missing link in a wholesale shift to renewable energy. Complex, volatile, and expensive, bringing down storage costs and making it more efficient has the potential to cause major upheavals in the fossil fuel based grid.
Energy storage, even though being discussed widely today, has been around for a while. Basic storage batteries have been used since the early 1800s, when Alessandro Volta invented the first one in 1800.
The biggest examples at grid level have been pumped-storage hydropower or power generating dams, which have been around since the 1920’s. While the basic solid state battery and pumped storage hydropower have still survived with technical advancements, the overall energy storage market is poised to take of in a huge way, on the back of pressure for greater renewables integration into the grid and dropping costs.
Bloomberg New Energy Finance (NEF) has in fact predicted an exponential multiplying of non-pumped hydro energy storage installations around the world to 3,000 GWh of deployments by 2040.
In its annual investment outlook report on the storage space, it claims that 9 GW / 17 GWh of energy storage was deployed as of 2018 and forecasting this to rapidly grow to 1,095GW / 2,850GWh by the year 2040.
“Energy storage will become a practical alternative to new electricity generation or network reinforcement,” while customer-sited behind-the-meter energy storage systems will more commonly provide network services.
In terms of expected battery demand, Bloomberg NEF has given a combined forecast of 4,584GWh for both electric transportation and stationary energy storage systems by 2040, with EV’s making up a third of global passenger vehicles by then.
On the costs front, for a long time, the holy grail of storage costs has been estimated at between $90 -100 per kWh for Lithium-Ion batteries backed storage, this being widely considered to be the price at which large scale adoption becomes viable across use cases.
As per latest projections, costs have dropped from $280 in early 2018, to $ 140 now and are projected to fall all the way to $62 to $76 per KwH, based on estimates by various agencies. On existing power tariffs, these costs will make a combination of renewables and storage an irresistible option for consumers.
Presently, for major renewable energy options like wind and solar, fossil fuels (diesel, gas) offer formidable competition, thanks to the latter’s ease of transportation and storage, which allows generators a great degree of control and flexibility over how much, and when to produce.
For renewables, depending as they do on the sun and the wind, such a flexibility is impossible unless storage drops to a point that allows excess production to be stored for later use cheaply, safely and with minimal space demands.
But with a slew of e technologies available and competing for energy storage, storage at scale is no longer a distant hope. In some cases, like the pilot projects in Australia and the UAE, it’s a reality even as states and countries around the world are emboldened to set targets for total energy storage capacity. One of the brightest hopes for the global community.
India, with its own ambitious 50 GW storage manufacturing aim would seem to be getting in at the right time, with a high possibility of catching the storage wave at the right size and costs for manufacturing in India. The good news is that progress has made energy storage capable of attracting investment on its own legs, a good sign for a capital starved country like India.
Don’t miss our second part of this series, where we look at the key storage technologies being tried today, dominated by Lithium Ion batteries for now, but with potential in many others too.
Read the second part here.