Lazard’s levelised cost of storage report 2017
The 3rd edition of Lazard’s report finds that 1) selected energy storage technologies are increasingly attractive for a number of specialised power grid uses, but none are yet cost-competitive for the transformational scenarios envisioned by certain advocates; 2) industry participants expect costs to decrease significantly over the next five years, driven by scale and related cost savings, improved standardisation and technological improvements, supported in turn by increased demand as a result of regulatory/pricing innovation, increased renewables penetration and the needs of an aging and changing power grid; and 3) as the energy storage market continues to evolve, several potential sources of revenue available to energy storage systems have emerged but, ultimately, the mix of available revenue streams for a particular energy storage system varies significantly across geographies.
Best performing battery metal of the past year isn't cobalt
According to Bloomberg Business Week, demand for vanadium in the past year has soared more than 130 per cent, outperforming better known battery metals like cobalt, lithium and nickel. Although much of the demand has come from orders from the steel industry, analysts are predicting greater use of vanadium for industrial-scale batteries. The metal has some significant advantages over traditional battery metals. It lasts longer and it can be charged and discharged repeatedly without any significant drop in performance. In China, vanadium-flow batteries are already emerging as an alternative to lithium-ion. For analysis of lithium markets, see the FT’s analysis (paywall) here.
AES and Siemens launch world’s biggest battery project to compete with Tesla Energy
AES and Siemens are combining their efforts to launch new energy storage start-up called Fluence, which received regulatory approval in the USA in January 2018. Fluence will become the supplier of AES’ 100MW/400MWh Alamitos power centre energy storage project in Long Beach, California serving Southern California Edison and the Western Los Angeles area.
Stem adding artificial intelligence to storage and branching out to new markets
This article considers Stem’s artificial intelligence platform, Athena, and how AI can facilitate and optimise the stacking of storage revenues. Stem have raised over US$100 million from backers such as Constellation, Mitsui and RWE, as well as US$500 million in project finance to align the customer payment model with the intelligence-based optimisation solution.
"Just beginning" - global energy storage market to boom
A recent report by Bloomberg New Energy Finance has forecast that the energy storage market will grow 12-fold in the years to 2030, increasing to 125GW of capacity globally, with future growth in energy storage investments of up to US$103 billion. The report also finds that the cost of utility-scale battery systems will likely decline significantly by 2040, falling from around US$700/kWh of storage capacity in 2016 to less than US$300/kWh.
Off-grid solar and storage may be 80 per cent cheaper in developing countries than assumed
Crown Agents, a non-governmental organisation, are combining solar photovoltaic with storage in off-grid applications. A recent report by Crown Agents suggests that the levelised cost of energy for new off-grid or grid-tied distributed solar-plus-storage could come down to less than US$20 cents/kWh, compared to US$60 cents/kWh for small diesel and petrol generators.
Africa and the Middle East
Morocco’s ‘largest rooftop solar plant’ nears completion with cold storage
Maghreb Industries, a Casablanca-based confectionary producer, is in the process of implementing what it claims to be the largest rooftop solar project in Morocco. Maghreb is developing a 1,361kWp rooftop solar plant that uses an ice-based storage system to allow the factory to store power during off-peak hours and use it during peak hours, cutting costs. Though unfinished, the Maghreb solar plant is already producing 60 per cent of its factory’s electricity needs. The EBRD, provided a EUR 4.6 million loan through its Finance and Technology Transfer Centre for Climate Change program.
BayWa r.e. connects pilot PV+storage project in Zambia
BayWa r.e., a German PV developer, has completed its first solar project in Africa. The 86kW PV + storage project is located in Zambia and will supply power for the irrigation of 90,000 m2 of Zambian farm land for up to 13 hours at a time. BayWa r.e. indicated it sees great potential for African projects and plans to expand its involvement on the continent.
Woodside, ABB to install microgrid system on Goodwyn A offshore platform
Australia’s oil and gas company Woodside has signed an agreement with ABB Australia Pty Ltd to install microgrid solution with a lithium-ion PowerStore Battery energy storage system on its "Goodwyn A platform" during the second half of 2018. The installation marks the first time such technology has been used on an offshore gas platform. It is expected that the installation will reduce Goodwyn A’s use of fuel gas by more than 2,000 tonnes per year.
The Breakneck Rise of China’s Colossus of Electric-Car Batteries
Contemporary Amperex Technology Ltd. (CATL) is looking to raise YUAN 13.1 billion (US$2 billion) to finance construction of a battery-cell plant second in size only to Tesla Inc.’s Gigafactory in Nevada. The new assembly lines would quintuple CATL’s production capability and make it the world’s largest electric-vehicle battery cell manufacturer, ahead of Tesla, Warren Buffett-backed BYD Co. in China and South Korea’s LG Chem Ltd.
"Support agreement" pushes ahead "world’s first" wind-plus-storage crop farm in Australia
French renewable energy developer and independent power producer Neoen has signed a "support agreement" with local authorities to develop the world’s first protected crop farm, powered by renewable energy at the Bulgana Green Power Hub. The total expected investment for the project is AU$665 million which will see Nectar Farms build 30 acres of glasshouse in which to grow fruit and vegetables for local sale and export alongside the 63 wind turbines and battery energy storage.
Whyalla steelworks owner Sanjeev Gupta makes AU$700 million power play in South Australia
British billionaire, Sanjeev Gupta, is establishing himself as a major player in South Australia’s energy market through a combination of solar, pumped hydro and battery storage projects. Although the projects are still very much in their infancy, plans include a 120MW pumped hydro facility at a disused mine in the Middleback Range near Whyalla, Australia.
Mahindra Susten’s storage-cum-solar project in the Andaman islands scrapped
State-owned coal mining company NLC India has decided to retender its requirement for a battery plant in the Andaman and Nicobar Islands due to a change in requirement. NLC India will now call for bids for a smaller 8MWh project. In the last three years, more than 10 energy storage tenders have been cancelled.
China plans graphite megafactories to meet booming demand for battery storage
China is leading efforts to deliver an almost threefold increase in global graphite processing capacity by 2020, to meet lithium-ion battery industry demand. Shanshan Technology, BTR New Energy Materials and LuiMao Graphite (in association with BAIC Automotive Group) are building lithium-ion battery graphite anode megafactories with a total processing capacity of 260,000 metric tons per year. Hitachi Chemical in Japan is planning another facility to process 100,000 metric tons of graphite a year. The increases compare to a total estimated global processing capacity of around 200,000 metric tons at present. In 2016, graphite production amounted to just 100,000 metric tons.
Tokyo’s Tepco to test Stem and Sunverge behind-the-meter batteries as virtual power plants
Two California-based start-ups, Stem and Sunverge, have joined forces with Mitsui for a series of virtual power plant projects for Tokyo Electric Power Co. (TEPCO), utilising batteries on various commercial and industrial sites, to dispatch power across a portfolio of sites and reduce demand charges. The two projects announced are relatively small scale given TEPCO’s position as Japan’s largest utility company however, it demonstrates TEPCO are embracing a future with more distributed and renewable power.
Moixa inks Japanese energy storage export deal
Technology specialist Moixa has partnered with Japan’s Itochu Corporation to market its GridShare platform in Japan. The deal with also see Itochu invest a further GBP 5 million in Moixa to support its international expansion plans.
"World’s tallest" wind turbine gets 70MWh of pumped storage near Stuttgart
The world’s tallest wind turbine will be combined with a 70 MWh pumped hydro energy storage facility. The 246.5 metre wind turbine is part of a four-turbine wind farm in Limpurg Hills, on the outskirts of Stuttgart, Germany. The wind turbine stands in a 40 metre deep natural water reservoir which generates electricity when its reserves are dropped through turbines into an additional pool. The pumped hydro storage system can transition from storage to production in 30 seconds.
World’s first floating wind farm will have 1.3MWh battery system from Younicos
Statoil has awarded Younicos the contract to deliver its Batwind project, a 1MW/1.3MWh battery system. The battery storage system is designed to streamline fluctuations electricity output of the Scottish Hywind floating offshore wind farm by storing excess energy and reinjecting it into the grid to correct variations in production of the six 5MW Siemens turbines.
Danish tech firm looks to batteries for integrated wind-plus-storage solution
Danish wind systems developer, KK Wind Solutions, is turning to battery storage as a solution to output fluctuations. The company is collaborating with turbine maker Vestas, engineering company PowerCon and Aalborg University to design a system that can store up to 8 per cent of its total wind farm capacity. According to its estimates battery storage can reduce fluctuations by 90 per cent. In another sign of growing interest in battery storage by the wind power sector, industry giant Vestas announced a US$12 million investment into its wind energy grid storage partnership with Northvolt.
Akasol opens European battery production facility for commercial EVs
German battery maker Akasol opened a new EUR 10 million factory. The facility, now Europe’s largest production facility for battery systems for hybrid and electric commercial vehicles, has a capacity of 600MWh of battery systems per year; enough to equip up to 3,000 hybrid or electric vehicles. The plant’s production lines will supply Akasol’s Akasystem OEM batteries.
Boost for UK's electric car sector with new projects from BP and Nissan
BP has invested US$5 million (GBP 3.6 million) in FreeWire, a US-based manufacturer of mobile electric vehicle rapid charging systems. BP will trial the fast charging technology at selected retail sites in the UK and Europe during 2018. Meanwhile Japanese vehicle manufacturer Nissan has announced it will participate in a GBP 9.8 million programme with the UK Government to develop “electric vehicle-to-grid” systems. The demonstration project will use a fleet of 1,000 electric vehicles to store excess solar and wind power on the grid.
Greensmith and AEP launch hybrid hydro energy storage project in USA
Greensmith Energy, a Wärtsilä Company, and American Electric Power have agreed to install a 4MW energy storage system integrated with the Buck and Byllesby hydroelectric power plants in southwest Virginia, USA. The integration of advanced energy storage and software with hydroelectric generation is seen to be the first hybridised system of its kind to provide ancillary services. The system, due to begin operating in the first quarter of 2018, will deliver PJM (Pennsylvania, Jersey, Maryland power pool) frequency regulation market one of the first new energy storage systems since the adoption of new frequency regulation signals and requirements for regulation service.
Enel signs 85MW of capacity storage agreements with PG&E
US renewables company Enel Green Power North America, Inc. (EGPNA), a subsidiary of Enel, signed three Capacity Storage Agreements (CSA) with California utility Pacific Gas and Electric (PG&E) for a total capacity of 85MW/340MWh. Under the agreements, Enel will build Kingston, Cascade, and Sierra stand-alone lithium-ion energy storage projects, all to be located in California, in order to better integrate renewable generation into PG&E’s grid, increasing grid reliability, while also easing congestion. The projects are developed with Sovereign Energy Storage, an independent developer of large-scale utility battery energy storage projects, and are expected to be operational by 2023, pending review and approval by the California Public Utility Commission as well as local and regulatory agencies.
LADWP and Doosan GridTech tread new ground with 20MW battery project
The Los Angeles Department of Water and Power (LADWP) recently approved procurement of a 20 MW/10 MWh lithium-ion system to go into the Beacon Solar Plant in the Mojave Desert, USA. The system will increase utilisation of the desert's solar generation, as well as provide grid reliability service in the wake of the Aliso Canyon natural gas disruption. This is the first time that full-wrap, turnkey EPC services will be provided by a company such as Doosan GridTech, which is traditionally focused on software solutions for optimising storage.
Mercedes plans to invest US$1 billion in an electric SUV-plus-battery plant in Alabama
Mercedes is investing more than US$1 billion to upgrade a U.S. plant for assembling batteries and electric SUVs. Along with a nearby battery factory, Mercedes will upgrade factory lines to build its EQ brand electric SUV, the EQ C, starting sometime around 2020. Mercedes will offer electric versions of all of its models by 2022, plus a new series of plug-in hybrids, for about 50 new models in all. In total, Daimler plans to invest US$11 billion in electric vehicles (EVs) over the next five years. Daimler’s strategy is being matched globally. Volvo announced in July 2017 that every new vehicle model released starting in 2019 will be either a hybrid or electric. Audi is scaling up EV production at its Brussels plant. Volkswagen has committed to investing US$10 billion over the next five years to bring 25 new EV models to market by 2025. And Ford plans to invest US$4.5 billion in electrification by 2020.
Duke Energy’s US$30 million investment in battery storage is "a harbinger of things to come"
Duke Energy is investing US$30 million into the two biggest battery storage projects in North Carolina. The projects may indicate new interest in storage among regulated utilities, as battery prices continue to fall. Both of Duke’s projects, a 9MW project in Asheville and a 4MW project in Hot Springs, will use lithium-ion technology.
Big money is getting into microgrids
Dynamic Energy Networks (DEN) will deploy capital raised by the Carlyle private equity group to create microgrids then operate them in an energy-as-a-service model for long-term contracts. This model has been deployed in a few instances already; it eliminates upfront capital requirements and caters to customers that want cleaner or more reliable power but do not want to be in the energy asset management business.
Latin America and the Caribbean
Chile’s latest auction signals growing interest in solar-plus-storage
Cox Energía, a Spanish developer and which won 140GWh at a price of US$34.40/MWh in Chile’s latest renewable energy auction, is likely to use solar PV-plus-storage technology to cover the night time energy requirements which formed part of its bid. Cox Energía is likely relying on the cost of solar PV-plus-storage falling before its projects enter operations in 2024.
Extreme storms spur interest in the developing battery microgrids market
Hurricanes that devastated the Caribbean, Puerto Rico, and Houston have spurred an interest in using battery-connected microgrids to ensure power grid reliability. Tesla CEO Elon Musk tweeted his interest in using solar power and batteries to rebuild Puerto Rico’s power grid to which Puerto Rican Governor Ricardo Rosselló responded, “Let’s talk.” Interest in battery microgrids is expected to grow as the cost of batteries declines. Following a request by the Puerto Rican Energy Commission, AES has recommended mini-grids with hardened critical tie-lines to lower cost to consumers and increase distribution reliability.
Jamaica Public Service Company to invest US$21 million in energy storage facility
The Jamaica Public Service Company committed US$21 million to develop a 24.5MW hybrid energy storage facility to safeguard against power outages. The facility will use a combination of high-speed and low-speed flywheels and containerised lithium-ion batteries. The project is being described as the first of its kind in the Caribbean.
Tesla in talks with Chile’s SQM over lithium investment
Tesla is in talks with Chile-based lithium mining firm SQM about sourcing future lithium supplies. Chile is home to the Atacama desert where some of the largest lithium reserves are located. Tesla will need to increase its lithium supplies if it hopes to expand at the rates its projected to.
Dominican Republic’s first energy storage arrays help island’s grid to prevent blackouts
AES Dominicana brought online 20MW of battery-based energy storage arrays at two sites in the Dominican Republic. These arrays played a major role in maintaining grid reliability in September 2017 when Hurricanes Irma and Maria ravaged most of the Caribbean. In fact, both storage arrays performed more than double the amount of work during the storms as normal, allowing Dominica’s grid to continue operating, even though nearly 40 and 50 per cent of the island’s power plants were forced offline during the hurricanes.