ORIGINAL REPORTING: The now and future impacts of energy storage

Primer: The now and future impacts of energy storage; With renewables growth comes the need to move variable generation to when customers use power most

Herman K. Trabish, October 20, 2015 (Utility Dive)

Grid operators and forward-thinking utilities are already getting a glimpse of what energy storage can do – but they ain’t seen nothin’ yet…Multi-megawatt energy storage installations are now providing services and finding value propositions and use case scenarios around the world and at all levels of the grid, according to Energy Storage Association (ESA) Executive Director Matt Roberts. And there are gigawatts of projects already on planners’ horizons…

Cost estimates vary, but all show storage rapidly becoming more affordable, he said, citing four sources. A Navigant study predicted a 4 hour battery storage system would be as low as $700 per kWh by 2020 while Oncor foresees a $350 per kWh cost in 2020. Morgan Stanley estimates battery-only costs will eventually approach $125 per kWh and Tesla has said its lithium-ion battery-only cost is already $110 per kWh.

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The battery cells make up around 30% to 40% of a battery system and the rest is in the cost of the balance of system (BOS) hardware like inverters, switches, control systems and power electronics, Roberts said…An ESA-calculated 5.8% drop in BOS costs by 2030 takes the system installed cost to around $400 per kW, he added…

There are as many as 30 to 40 different applications for energy storage on the grid “but there are multiple applications within each segment that storage can provide value in,” Roberts said…End users are looking for technologies that allow them to manage their energy consumption..Energy storage is already succeeding in the marketplace as a flexibility resource because it has a very fast response time…Storage as a capacity resource is likely to be an increasingly important market factor because it addresses the burden on the electrical system of peaking demand…In further modeling, B&V found the effect of solar and storage on load was very much dependent on policy questions like the availability of incentives and time-of-use rates… click here for more

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