The Rise of Utility-Scale Energy Storage

The Rise of Utility-Scale Energy Storage

December 02 2019

“solar+storage” - The What, How, When, Where, and What’s Next…

Written by Saurabh Mishra

What? Solar+Storage

According to the U.S. Department of Energy's Office of Energy Efficiency and Renewable Energy (EERE), the term “solar+storage” is defined as “a battery system that is charged by a connected solar system, such as a photovoltaic (PV) one.”

The most fundamental reason why solar power and grid-scale battery storage are entwined in a symbiotic relationship, and described as such, is because solar systems are intermittent in nature and require energy storage systems to “smooth” out the intermittency.

Simply put -- when the sun is not shining, there must be a mechanism that can store captured solar power to use it later.

While demand for utility-scale storage is, itself, not a new trend here in the U.S., the market need for energy storage solutions has dramatically risen over the past few years with the rapid growth of renewable energy projects across the country.

We predict that the energy grid of the future is going to be based on renewable sources, and since renewables produce power with intermittent and varying outputs, that means that continual development of new energy storage solutions will be required in order for renewables generation to operate at a meaningful scale.

How? - The rise of Li-on

There are a wide variety of technologies offering the capability to store energy, including compressed air, flywheel, and a variety of battery chemistries including: Lead-acid, Ni-Cd, sodium, flow, and lithium ion (“Li-ion”).  Since CS Energy is a technology agnostic company, we are focused on Li-ion, because thus far, Li-ion is the most reliable and bankable technology, and it has the widest market penetration within the U.S. energy grid (more than 80% of the total installed battery capacity consist of Li-ion batteries).

The benefits of Li-ion technology include high-round trip efficiency, long cycle life, flexibility, fast response times to manage moment-by-moment fluctuations, and high-power density. Additionally, the Li-ion supply chain is bankable and creditworthy, consisting of suppliers who can stand behind their product warranties – a critical requirement to raise capital required to fund projects.

Safety

Batteries can get hot, and proper handling and installation of battery modules and racks are critical to ensure a safe installation and operation of the battery system without triggering events like fire. From the Associated Press in June of 2019: “Anytime you store a lot of energy in a small space you’ve got to be very cognizant of the controls that you have to put in place so that energy doesn’t get out when you don’t want it to,” advised Professor Jay Apt, co-director of Carnegie Mellon University’s Electricity Industry Center.

Safety has always been the cornerstone of CS Energy’s role as a leading solar EPC and that extends to our projects in the battery storage space. We are happy to see that the storage sector is, increasingly, considering safety as one of the most important factors, which is driving the move towards standardization (i.e. UL 9540A , NFPA 855) and more detailed fire safety checks in coordination with AHJs (Authority Having Jurisdictions) all of which are critical to mitigate safety and fire risk.

When? First, a little bit of history….

Grid-scale battery storage systems did not occupy an obviously profitable place within the tightly regulated utility-scale generation/distribution energy ecosystem. The sea change that “powered” the rise of grid-scale battery storage in the U.S. took place in 2011, when the Federal Energy Regulatory Commission (FERC) issued Order 755, which opened up the market for battery storage by calling for more equitable treatment for fast-responding resources, (such as li-on batteries) in the frequency regulation market.

In 2012, the PJM Interconnection (PJM) -- the regional transmission organization that operates the electricity grid across 13 mid-Atlantic states and D.C. -- implemented the Order 755 rules, and, also in 2012, the first grid-scale Li-ion energy storage system of 5 MW/1.25 MWh was commissioned for Portland General Electric (PGE) Since then, we have over 1 GW of battery plants from different chemistries installed and under operation.

Where? Geographical diversification

According to the SEIA, “states with higher storage penetrations will lead an unmistakable trend in the solar industry.” Certain states are leading the way by introducing measures related to grid-scale energy storage. In 2018, the US installed 311 MW/777 MWh of battery storage, which represents an 80% increase over 2017. Interestingly, this lift came from deployments not just in legacy markets like California or PJM but from new markets like Hawaii, Texas, Minnesota and Colorado.

Also, new incentives in Massachusetts and New York, two states within CS Energy’s core geography, are giving the energy storage category a big boost. NY recently passed a bill to set a target of 3 GW of storage by 2030 which is one of the most ambitious storage plans in US, and Massachusetts will soon be requiring all large DG solar systems to incorporate an energy storage system.

What’s Next? The Future of...

According to Wood Mackenzie Q3 US Energy Storage Monitor Report, in 2019, the US is expected to install 478 MW and by 2020, it will see substantial growth with approximately 1250 MW annual installation. By 2024, US energy storage annual deployment will reach 4.8 GW with $5.1 billion market.  Fundamentally, CS Energy believes that grid-scale battery storage will continue to rapidly expand into the foreseeable future. As we see more and more penetration by intermittent sources like solar and wind, more storage solutions will be integrated to smooth out the intermittency and to maintain grid stability. While it is, of course, possible that existing Li-ion chemistries will be replaced by better, longer duration and high-power battery technology, the storage industry itself is almost certainly going to continue to grow rapidly.

Please contact Kevin Magayah, CS Energy, at kmagayah@csenergy.com, 732-484-2432, to discuss any aspect of solar+storage.

About the Author

Mr. Saurabh Mishra is an energy storage engineer at CS Energy, a leading integrated energy company that develops, designs and builds optimized projects in the solar, storage and emerging energy industries. As a storage lead, Mr. Mishra’s area of expertise lies in techno-economic feasibility, asset management and extensive knowledge & command over optimizing solar-storage solutions for varied stakeholders. Previously, Mr. Mishra worked as an Engineer in a thermal generation power plant and as a Transmission Engineer at a 400 KV substation for the public utility with 5 GW capacity; where he was responsible for supervising, testing, commissioning, and O&M of the operating equipment.

He earned a Master’s from Carnegie Mellon University’s “Master's Program in Energy Science, Technology & Policy (ESTP)” a distinctive degree “based in engineering, aligned with new discoveries in science, attuned to sustainability and the environment, and informed by a broader perspective in economics and public policy,” and a B.S. in Electronics and Communication from Uttar Pradesh Technical University in India.