Analysts see a strong, upcoming demand for energy storage as part of the grid. This will likely be a combination of some kind of central storage (for example, a 20MW flywheel installation near a power generation station) and distributed storage (for example, batteries or supercapacitors next to the familiar green transformers in people’s yards).

These types of energy storage are primarily driven by a need on the part of utilities for load balancing, since it’s expensive for them to constantly adjust the output of traditional power generation systems as the load varies. Energy storage may even allow them to offset or delay the requirement of additional power plants, such as a gas-fired “peaker” plants.

In some markets, there may also be value for companies and people on the “other side of the meter” to buy and store power when it is least expensive and use the stored power during peak demand when prices are highest. Called “time shifting,” this is an interesting concept, although it may be a bit ahead of its time. Jaime Smith of SunEdison, who runs the installer/developer’s North American PV commercial operations, said “as far as taking a solar curve and shifting it and it being worth the value of that shift for the cost of the storage, we have not seen that yet. We’re keeping our eyes and ears open for the right technology but we haven’t seen anything yet that is cost-effective.”

To a lesser extent, the need for energy storage will also be driven by the inherently intermittent nature of many renewable energy sources, such as solar power and wind. As more of this kind of power generation comes online, it makes sense to store the energy for times when the wind isn’t blowing or the sun isn’t shining.

Proponents of solar power, however, like to point out that although PV is intermittent (due to clouds and of course darkness), it’s actually highly predictable. Clouds don’t cause that much variability if the PV is spread out over a wide enough area. And because clouds are visible, it’s relatively straightforward to predict the impact on power generation on a short-term basis and even easier to predict the amount of power that will be generated the next day based on weather reports.

That’s fine because power markets operate on a day-to-day basis. Dan Shugar, CEO of Solaria, a supplier of PV modules, said “In PG&E’s territory alone, which is pretty much north of L.A. up to Oregon, there’s about 30,000 solar plants. If you look at a 10 x 10 mile area, statistically there’s no variability.”

Also, depending on location, peak demand is often in near-perfect sync with PV-generated power, since it’s the heat of the sun that creates the need for air conditioners, which are the primary source of demand.

“Solar is not available when you want it, but it’s available when you need it,” said Smith of SunEdison. “It does have intermittency, but the reality is when the demand is the highest (which is when air conditioning demand is the highest) we are the strongest,” he said. Shugar agrees: “Do we need storage today? No. Solar is generating in a very high correlation when the grid is needing power.”

While that’s true in most of California, the story can be a different in other states. “We’re not perfectly correlated because people come home and flip on their air conditioning in western states at 5:00 p.m.and we’re peaking earlier than that, so storage could be very interesting for us to try to shift that curve,” Smith said.

In five to 10 years when PV and other renewables have come to represent a significant percentage of the overall power generated for the grid, energy storage could play an increasingly important role. “As you go from a scenario where 2 percent of the peak load is generated by PV to 20 to 30 to 40 percent, you start to get into a situation where you need storage,” Shugar said. But he also said that many other ways exist to control demand with a smart grid in place.

Instead of building dedicated storage systems, for example, all the commercial buildings with over 50 kW/h of load now have time-of-use metering. “It’s very simple to install some demand response (there are programs that exist right now that are doing that) where you might let the temperature go from 71 degrees to 72 or 73 when electricity prices are highest,” he said.

Electric vehicles will also come into play, in part by helping to advance battery technology, but also by becoming an integral part of the Smart Grid. Andy Chu, director of marketing at A123 Systems envisions a time when utilities are so linked into the grid that they can monitor and control electric vehicle battery chargers and charge them quickly or slowly to optimize the load/generation equation.

“Electric cars already have a computer that can control the charging rate,” Shugar said. “My car is charging right now out in the parking lot from a solar array coupled with the building. I could easily control the rate at which that car is charging based on the availability of solar or a demand signal from the utility.”

Fuel cells, once fully developed, could also be used for energy storage. In one cleantech approach, Emmanuel Giannelis, co-director of Cornell’s KAUST Center for Energy and Sustainability, says CO2 sequestration-made possible with nanoparticle ionic materials-could be combined with a solar photocatalysis process. “People are focused on systems where you can split water into hydrogen and oxygen and combine the hydrogen with sequestered CO2 to make methane or methanol. You can then store and use that just like gasoline or other fuels,” he said.

The two main applications of energy storage technologies are for power-driven by the needs for power quality and bridging power-and for energy management. In power applications, stored energy is only applied for a period of seconds or less to assure continuity of quality power. Or it might be used for slightly longer (a few minutes) to assure continuity of service when switching from one source of energy generation to another. For energy management applications, storage is used to decouple the timing of generation and consumption of electric energy, as previously described. A typical application is load leveling, which involves charging storage when energy cost is low and using the stored energy as needed.

(The table on above, developed by the Electricity Storage Association, lists various energy storage technologies, describes main advantages and disadvantages and provides a rough measure of relative feasibility.)

A new report issued earlier this year by Sandia National Labs, titled, “Energy Storage for the Electricity Grid: Benefits and Market Potential Assessment Guide,” goes even further, describing five main applications for energy storage, with 17 subcategories.

Electric supply (electric energy time-shift, supply capacity)

Ancillary services (load following, area regulation, reserve capacity, voltage support)

Grid systems (transmission support, congestion relief, upgrade deferral, substation on-site power)

End user/utility customer (time-of-use energy cost management, demand charge management, service reliability, power quality)

Renewables integration (energy time-shift, capacity firming and wind generation grid integration).

Figure 1 (below) shows financial benefits and maximum market potential estimates for the U.S. for each of the 17 subcategories. Renewable energy sources represent one driver for energy storage, but they will not be the primary driver.

When it comes to renewables, the report notes that one of the main objectives of energy storage is “capacity firming.” Here, the goal is to get a fairly constant output from combination of renewable energy generation and storage. The resulting firmed capacity offsets the need to purchase or “rent” additional dispatchable (capacity) electric supply resources. Depending on location, firmed renewable energy output may also offset the need for transmission and/or distribution equipment.

One important challenge associated with intermittent renewable energy generation is that the generation’s power output can change rapidly over short periods of time. Photovoltaic (PV) output can drop quickly as clouds pass. Wind generation output can change rapidly during gusty conditions. These rapid changes (also known as ramping) can lead to the need for dispatchable power sources whose output also can change rapidly. Most non-renewable energy generation facilities (for example, coal, nuclear and natural gas) are best operated at a constant output. Rapid changes from intermittent renewable energy generation can lead to ramping of these sources, which increases wear, fuel use and emissions. In some regions, there may not be enough dispatchable generation capacity to offset renewable energy generation’s ramping, which creates addition problems potentially solved, again, by energy storage.

An example of the daily operation profile for wind generation plus storage on a summer day is shown in Fig. 2 below. For the scenario depicted, wind generation output occurring at night, when the energy’s value is low, is used to charge storage. In this example, about one-half of the energy used on-peak is from wind generation that occurs off-peak. The result is constant power for five hours.

The vision of the smart grid with renewable sources and energy storage working in harmony is complicated by one main factor: The U.S. electric industry includes over 3,100 electric utilities. Investor-owned utilities represent 8 percent of the total and approximately 75 percent of generation capability and revenue. There are 2,009 municipal utilities, supplying approximately 10 percent of the generating capability and 15 percent of retail revenue. Then there are 912 cooperatives, operating in 47 states that account for 9 percent of total revenue and around 4 percent of generation.

Some utilities have embraced the concept of energy storage and already are implementing it. New York’s Independent System Operator published a paper earlier this year titled “Energy Storage in the New York Electricity Markets,” which notes that integrating all types of energy storage technologies into the modern electric grid is becoming a priority. Storage resources can complement intermittent renewable resources such as wind and solar power by storing excess power for delivery when it is most needed. Some storage resources, particularly limited energy storage resources (LESRs) where energy output is measured in minutes, are well suited to providing regulation service that has traditionally been supplied by conventional hydroelectric and thermal units.

“The use of storage for services that require fast response helps to improve system efficiency while reducing the need to burn fossil fuels to provide this service,” the report noted.

Beacon Power is constructing a 20 MW flywheel energy storage facility designed to provide regulation service to the electric grid. Beacon’s system uses 1 MW flywheel modules consisting of 10 individual 25kWh flywheels integrated into a plant that can provide up to 20 MW of regulation service. Beacon received a conditional commitment for a $43 million loan guarantee from the U.S. Department of Energy and broke ground in Stephentown, N.Y. in November 2009.

AES Energy Storage proposed three 20 MW battery storage facilities in the upstate New York counties of Broome, Onondaga and Niagara. AES previously developed a 2 x 1 MW grid-scale energy storage system constructed with battery cells manufactured by Altair Nanotechnologies. The system has the capability to deliver 1 MW of power to the grid for 15 minutes.

Energy storage also made notable progress recently in California, with the passage of AB 2514 at the end of September by the California State Assembly. The bill requires the Public Utilities Commission by March 1, 2012 to open a proceeding to “consider establishing investor owned utility procurement targets for viable and cost-effective energy storage systems” to be achieved by the end of 2015. It has an additional target to be achieved by the end 2020. Publicly owned utilities would have comparable requirements and would be required to develop plans to maximize shifting of electricity use for air-conditioning and refrigeration from peak demand periods to off peak periods.

Another element essential to widespread use of energy storage in the grid (and renewable energy in general) is standardization. One standard of importance is IEEE P1547.8, which is focused on high-penetration, grid-connected photovoltaic technology, including energy storage aspects.

Chemical energy storage devices (batteries) and electrochemical capacitors (ECs) are among the leading energy storage technologies today. Both are based on electrochemistry. The fundamental difference between them is that batteries store energy in chemical reactants capable of generating charge, whereas ECs store energy directly as charge.

A convenient way to compare the operational characteristics for batteries and ECs is to plot the power density as a function of energy density, as shown in Figure 3,below. The “capacitors” shown on the low-energy-density end refer to the dielectric and electrolytic types widely used in power and consumer electronic circuits. These types of capacitors have very high power, very fast response time, almost unlimited cycle life and zero maintenance. However, their energy density is very low (less than 0.1 Wh/kg in most cases). Hence, they store very small amounts of energy and are not useful for applications in which significant energy storage is needed. On the other hand, ECs can operate over a fairly broad range of energy and power densities. This versatility is a key feature for adapting EC systems for energy storage, energy harvesting, and energy regeneration applications.

Unfortunately, according to a Department of Energy report “Basic Research Needs for Electrical Energy Storage,” the performance of current electrical energy storage (EES) technologies falls well short of requirements for using electrical energy efficiently in transportation, commercial and residential applications.

For example, EES devices with substantially higher energy and power densities and faster recharge times are needed if all-electric/plug-in hybrid vehicles are to be deployed broadly as replacements for gasoline-powered vehicles. Although EES devices have been available for many decades, there are many fundamental gaps in understanding the atomic- and molecular-level processes that govern their operation, performance limitations and failure.

The government report call for fundamental research to uncover the underlying principles that govern these complex and interrelated processes. “With a full understanding of these processes,” the report said, “new concepts can be formulated for addressing present EES technology gaps and meeting future energy storage requirements.”

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