Global energy system primed for storage ‘megashift’
There will be an international 'megashift' towards energy storage - batteries in particular - within the next 10 years, the Australian Renewable Energy Agency (ARENA) has predicted.
In a new study, ARENA forecasts that the cost of Li-ion batteries will fall 60% by 2020 and the cost of flow batteries will fall by 40%, leading to an installation boom.
The report states: “The rapid uptake of solar PV provides a useful analogy to what could occur in the energy storage market, as technology prices have potential to reduce as technology development simultaneously improves.
“The behind-the-meter market segment of energy storage is widely expected to undergo a similar boom to the solar PV industry, with a tipping point expected within the next ten years as further cost reductions are achieved.”
The report adds that energy storage adoption is likely to occur as a “megashift” rather than a gradual change, thanks to these rapidly changing costs and a “disruptive influence on the market”.
The supply-side (energy generators and providers) has an obvious need for energy storage, as the technology can be used to balance the variable outputs of renewable sources, but the report says the biggest growth could come from the demand side, as consumers and businesses install batteries to store excess power from onsite and rooftop renewables.
In the UK, this shift is likely to occur sooner rather than later.
In June, electric car company Tesla announced its entry into the energy market, unveiling a suite of low-cost solar batteries for homes, businesses and utilities. Energy experts hailed the arrival of Tesla’s affordable ‘Powerwall’ systems as a “nail in the coffin of conventional utilities”.
Earlier today, edie’s sister title Utility Week reported that Tesla plans to start selling its Powerwall battery to UK consumers in the first quarter of 2016.
The Powerwall system has already exemplified the rapid cost reductions associated with energy storage, as Elon Musk recently doubled the system’s output free of charge despite taking 38,000 pre-orders in the first week after launch.
Tesla said it is working with utilities and other renewable power partners around the world to deploy storage on the grid to “improve resiliency and cleanliness of the grid as a whole”.
Tesla’s impending entry into the UK market has also stimulated a flurry of rivals, including several crowdfunded domestic offerings.
In June, British start-up company Powervault raised £700,000 on Crowdcube to fund its own home energy storage system, with the firm aiming to sell 10,000 storage systems in the next three years. And last month, London-based energy storage firm Moixa launched its own crowdfunding campaign for a system which could rival Tesla, Powervault and other players in the surging battery market.
The ARENA report is relatively dismissive of pumped hydro storage – the current dominant technology in the international storage market. It states: “Further deployment of pumped hydro is severely limited by geographical and environmental site requirements as well as project size requirements to achieve economies of scale.”
However, a recent report claimed that a grid-scale system of pumped hydro in the UK could cut the cost of decarbonisation by £3.5bn by helping balance demand at peak times.
Another study from the International Renewable Energy Agency (IRENA) called for the planet’s energy storage capacity to be tripled by 2030, with 325GW of pumped-storage hydroelectricity, and 150GW of battery storage installed.
© Faversham House Ltd 2022 edie news articles may be copied or forwarded for individual use only. No other reproduction or distribution is permitted without prior written consent.