Revolution or evolution?1 August 2017
Anthony Price, Swanbarton Limited and Electricity Storage Network, UK
Just as there are many different types and configurations of power generation, there are many types and configurations of electricity storage. The energy sector has been propelled to the head of the agenda for businesses, consumers and indeed politicians, and the cries of the need for flexibility to keep the power system balanced have been heard by many developers and investors. It’s not just a response to technical requirements for system stability with a high proportion of variable renewable generation, but motivation to reap financial rewards from contracts such as UK National Grid’s EFR (enhanced frequency response) service that demonstrates the incentives for those prepared to invest in flexibility contracts and storage.
The revolution in the energy industry brought about by the lower cost of storage, particularly some battery types, means that it is now time to dust off the technical and financial models we created a few years ago and take another look at what the system really needs. The Electricity Storage Network (ESN), the UK’s industry group for manufacturers, developers and users of electricity storage, recently took the reins on this topic by addressing the next stages in the evolution of storage at a recent seminar (Longer Duration Energy Storage, IMechE, London, 4 May 2017).
Professor Goran Strbac of Imperial College, always an entertaining and informative speaker, presented his recent work and drew attention to some radical implications. In Goran’s view, while it is clear that renewable generation can provide an abundance of low cost and sustainable energy, the fact that it does not displace existing generating capacity in the future system is often overlooked. We shall therefore need to double the asset base if we are to produce the same amount of power in the future from renewable generation. Goran’s view is that by 2030, Great Britain will need 12 000 MW of extra storage – the equivalent of seven Dinorwig pumped hydro plants – in order to keep the system balanced. The ancillary services market could grow from 1.5% currently to 25% of the total traded market by 2030. There will be shorter peaks, but these will be more extreme.
The evolution of the power system as it incorporates storage is going to be fascinating. If there is only a small proportion of capacity on the system as storage, then short duration storage is all that is needed, but if we increase the proportion of storage to the higher levels needed to keep the system balanced, then we will need much more longer duration energy storage. This is the next step for storage industry.
RES is one of the leading developers of energy storage projects in the UK and USA. As integrators of both renewable generation and storage, they can see the improved financial returns that come from using storage to firm the output of variable renewable generation. Ed Kenny Herbert of RES explained the difficulty of calculating the optimal solution, based on a wide range of parameters, such as battery cost forecasts and the impact of other services on rates of return, and would not be drawn on defining the optimum battery size, but he was bold enough to say that a good duration for a battery system could be in the 3 hour to 4 hour rating. Considering that many batteries installed recently in the UK have been rated at about the 30 minute level, this indicates a substantial new requirement.
It’s probably worth making a small technical comment here and a plea for clarity. Many battery specialists like to use the “C rating” for a battery to describe its energy content. A 1 C battery means that at its nominal power, it is completely discharged in 1 hour. A 2 C battery means that it is completely discharged in 1⁄2 hour. It would be helpful if system developers for storage on power systems used units that we all understand – and described a storage plant in terms of its power rating in MW and its energy rating in MWh. This clarity would do much to bring a common vocabulary to the storage industry.
Scott McGregor of REDT, one of the UK’s major flow battery companies, now describes his company’s products as energy storage machines: this description demonstrates the true application of storage on the system. REDT is delivering six storage machines to a site in Cornwall with a total capacity of 1 MWh. The machines will be used to timeshift solar generation. Longer duration storage is clearly a significant opportunity for their business.
And storage is not just batteries: Fernando Morales of Highview Power, developers of a liquid air energy storage system, illustrated the need to reconsider the parameters of storage systems by looking at the trends in American markets such as PJM. Short term contracts for frequency regulation are being revised, and the new conditions require plant with higher energy capacity. Installing electricity storage with only a limited energy capacity could be storing up future problems for owners and operators when the market rules change – for plant that is installed to provide only one specific service could become a stranded asset. The past twenty years have seen major changes in our power and energy markets, in the technology base and how we use energy. Installing an energy storage system, with an operational lifetime of 20 years, but a commercial lifetime of a considerably shorter period, does not seem to make sense. Both Scott and Fernando see the requirements for longer duration storage to be growing, not only in the British home market, but also with substantial enquiries from abroad.
Nevertheless, interest in lithium battery systems continues to grow, although for some there is a liberal sprinkling of myths among the facts. Myth busting is one of Marek Kubik’s delights. Marek, of AES Energy Storage, dismissed the view that lithium battery systems were only short duration, as AES has successfully installed 4 hour and 5 hour systems in Hawaii and San Diego. AES look to install storage systems for the long term, with built in resilience, and in their view, systems specified with longer duration have lower through life operating costs.
The power system of the future is still evolving. UK Power Networks, which has considerable experience of operating battery systems from their Leighton Buzzard battery project, are close to inviting bids for flexibility contracts at a number of locations for longer duration storage, expecting to be seeing bids based on 3 or 4 hour duration systems.
This evolution of the storage market into newer sectors will be helped with a few changes along the way:
- Simplification and clarity of contracts for ancillary services and the capacity market that reward the benefit of both power and energy.
- Clarity on the classification of storage, to allow, where appropriate, shared ownership and operation between regulated and non regulated entities.
- Recognition that storage brings whole system benefits.
The ESN has opened up a new topic in the debate about how to take advantage of storage. The revolution in the power sector continues, not only increased renewables, but also severe changes in demand patterns, with plans for electric vehicles and heat pumps placing increased stress onto the distribution network, and storage is clearly one way to alleviate this. Making sure that the system evolves with the right types of storage is going to be important.