Building on the momentum created with stimulus funding announcements a few months ago, we’ve seen a significant number of recent announcements including funding news for General Compression's GCAES concept, progress for PG&E's CAES project, Suniva's Solar/Battery project in Georgia,  SCPPA's 53MW Ice Energy thermal storage in southern CA , Iowa’s Municipal Utilities announcement about the beginning of drill tests for their long awaited ISEP CAES project, Xtreme Power's 10 MW dry cell battery plant in Hawaii,  Beacon Power's participation in the CEC's wind/flywheel project, Austin Energy's use of Ice Bear for thermal storage, AEP’s Li-ion community energy storage project, funding of 19 energy storage projects by New York State Energy Research and Development Authority (NYSERDA) and Xcel's recent announcement of CAES, NaS Battery and Wind-to-Hydrogen projects.  

Also, with storage bills being floated in the house and senate, and a storage portfolio standard being discussed in California, there appears to be growing political support behind the industry as well. All of this activity seems to indicate that utility-scale storage’s “coming out party” is on its way.

But the real question is why do we need all of this storage on the grid?  Many assume that the need to balance the variable output from renewables is the principle driving force.  This is a topic I’ve covered in previous posts and, as I discussed then, this will certainly be an increasingly critical role for storage.  But it’s only the beginning of the story.

Understanding the Role of Storage

When the topic of utility scale storage comes up, the picture that many people have in their head is that of a big battery storing wind energy at night and providing power during midday lulls to make renewables "as constant as coal". Unfortunately, this bears little resemblance to the role that storage will often play on the grid.  A recent report by the National Renewable Energy Lab on the role of energy storage with renewables helps to dispel many of the common storage myths and paints a more complete picture of the technologies involved.

I don’t have enough time to cover everything in the report, which includes a comprehensive overview of grid operations, storage participation in restructured markets, storage technology overviews, and renewables integration costs. But I highly recommend reading the full document, available here. In this post I want to highlight two principle points: the multiple markets for storage on the grid and the portfolio of renewables integration strategies (of which storage is a part).

1) The Role of Storage: Beyond Renewables

The first point to understand is that storage has many rolls to play on the grid. A storage plant typically interconnects to the grid as a whole rather than being tied to balancing the output from a specific wind farm or solar plant. This enables storage to effectively participate in multiple markets and generate multiple revenue streams. To understand how those market are subdivided, its important to know that stability of the grid is maintained on several different time scales (see the figure below). These management regimes produce different markets in which storage can participate. An example of this is the California Energy Commission’s wind/storage demonstration project, a flywheel facility providing both balancing support for a local wind farm and frequency regulation services to the grid.

(Denholm et al, 2010)

If you want to delve deeply into this issue, a recent report by Sandia National Labs analyzes seventeen discrete storage applications and their potential. A summary of the results and a good discussion of implications for niche storage markets (as well as a link to the full report) is here.

2) Renewables Integration: The Full Range of Options

To understand the impact of variable generation from wind and solar on the grid reliability, let’s look at two cases. In the first case, the amount of renewables is small enough that the existing amount of flexibility on the system can effectively balance the fluctuations from wind and solar.

(Denholm et al, 2010)

The grid is built to handle a lot of demand volatility and uncertainty (i.e. we don’t know exactly when people will turn on their air conditioners) and therefore small amounts of renewables do not impact system reliability. In the figure above, the net load (total demand for electricity minus the generation from renewables) is within the range where the existing grid flexibility is enough to handle the variability from the renewables on the system.

The more renewables you have, however, the more the net load is reduced. This continues until you reach a point where there are no more flexible power plants that you can back down to accommodate a sudden surge in renewables output. At this point all that’s left are nuclear plants and other "inflexible" facilities that aren’t designed to ramp their output. At that point you need to find something to do with the excess energy.

(Denholm et al, 2010)

Once you hit the point where you have too much output from renewables and nothing left to turn down, it’s time to deploy storage, right? Not necessarily. Storage is certainly one option, but there are several other means of dealing with this kind of issue and some might well be cheaper than storage:

1. Sharing Resources: Balancing demand and supply over a larger region means that you average out a lot of the peaks and valleys in renewables supply and electricity demand. Supply and demand are typically balanced over an area called a balancing authority. Consolidating these areas or coordinating their operation would allow us to both mitigate the variability of renewables and reduce the demand volatility on the system. This is typically one of the least-cost options available.
2. Flexible Generation: Natural gas and hydroelectric plants can provide flexible generation. In the figure above, this would increase the height of the dark blue “cushion” and create room for more renewables.
3. Demand Response: Instead of having flexible supply, you can have flexible demand. This can mean large commercial customers that agree to be shut off, or customers with advanced meters and advanced appliances that shut off when needed.
4. Curtailment: This means you are discarding some of the energy from the renewables on the system when the net load dips too low. This is not the best case scenario, but the economic hit can be minimal if managed correctly.
5. New loads: You can absorb some of the excess output from renewables to charge cars, make hydrogen or desalinate water.   

(Denholm et al, 2010)

The bottom line is that energy storage and renewables integration certainly intersect, but neither is a subset of the other. We could summarize all of this with a Venn diagram: 

What does all of this mean for the storage industry and all of the funds going to support projects in this space? The truth is will need every available option in the red bubble above, and therefore this is the time to invest in proving technologies and buying down the cost of energy storage. The scale of the climate crisis means we need as many options as possible to facilitate the massive task of decarbonizing our power supply. Pilot projects, research programs, demonstrations plants and deployment incentives today will make sure we have the tools we need to meet the daunting challenges that we face. Ideally incentives will be structured in a way that directs those investments effectively to produce the best outcomes at the lowest cost, but thats a topic for another post.

All images are shown courtesy of NREL and reproduced from the report reviewed in this post:

Denholm, P; Ela, E.; Kirby, B.; Milligan, M. (2010) “The Role of Energy Storage with Renewable Electricity Generation” NREL/TP-6A2-47187

http://www.nrel.gov/docs/fy10osti/47187.pdf

Many thanks to Carlin Rosengarten and Cai Steger for their help putting together this post

(bonus for reading this far: more Venn diagram fun)

The "Eastern Interconnect" is the biggest of the three independent US grids (the eastern grid accounts for over 70% of the electricity consumed in the US), which means that reaching high wind penetrations in East requires a lot of turbines. EWITS projects that about 340,000 MW of wind power will be needed to reach wind penetrations of 30%. In terms of maximum output power (i.e. installed capacity) that's equivalent to more than 400 large conventional power plants. 

EWITS shows that this level of wind deployment is a major challenge, not only due to the number of wind turbines, but also because of the thousands of miles of new power lines needed to get that electricity to market. Installing a large amount of wind requires substantial investments in new transmission lines because the best resources aren't in areas of high population density.  We can look at the EWITS wind projections per region as a fraction of total demand for electricity to get a sense of how much this level of wind development would overwhelm existing power infrastructure:

Regional wind capacities in EWITS scenarios divided by 2006 peak load by region

This figure shows that in the Southwest Power Pool (SPP), the amount of wind in EWITS Scenarios 1, 2 and 4 is equivalent to more than 2 times the total peak power needs in the region. The amount of wind projected in SPP far outstrips all previous wind integration scenarios. In fact, a wind integration report for SPP released yesterday looks at wind deployment scenarios up to 25 GW (40% wind in SPP), which is only half of what EWITS projects, even in their least onshore-intensive scenario (Scenario 3), and less than 30% of the wind deployment projected in the other scenarios. The level of grid infrastructure development needed to maintain system reliability with such a high amount of wind clearly represents a major challenge.

What's new here?

There have been a large number of wind integration studies done in the past (a good review is here), but most of them have had limited geographic scope and resource base. Last year the Joint Coordinated System Plan (JCSP) took an important step forward by providing a model of the entire eastern interconnection in their high penetration wind scenario modeling. EWITS builds on this earlier work but takes another important step forward, looking not just at onshore wind resources, as the JCSP had done, but also integrating offshore wind resources.

Wind Resources in EWITS Scenario 3

Offshore wind is, potentially, an enormous source of power that is often relatively close to population centers, thereby reducing the amount of transmission needed to integrate large amounts of wind into the grid. Scenario 3 in EWITS is an aggressive local/offshore case with over 64 GW of offshore development. Its results project that a 20% wind penetration can be reached with 25% fewer miles of new transmission relative to the all-onshore wind case (Scenario 1). 

The conclusion one can draw from the EWITS study is that offshore is a potentially critical resource that can have significant impacts on how we decarbonize the electric power sector and reduce the scope of infrastructure development that will be required to support a large deployment of renewables on the system. 

The study also makes clear, however, that this does not eliminate the need for transmission to bring wind power from the Midwest. Even in the aggressive offshore case, over 17,000 miles of new transmission are needed including over 12,000 miles of the highest voltage AC (765kV) and DC (800kV) lines. Midwest onshore wind is the cheapest source of utility-scale renewable energy available in the East; offshore wind doesn't obviate the need to exploit onshore resources and it certainly doesn't eliminate the need for transmission. 

What's Next?

EWITS, like the JCSP before it, signifies an important step forward in our understanding of how variable generation can be integrated to the grid in large quantities. But there is still much that remains to be done. The addition of offshore wind resources is only the first step in understanding the full range of options available to facilitate the integration of renewables.

An aggressive deployment of energy efficiency, demand response, energy storage, distributed generation, and improved systems operations (e.g. dynamic thermal rating, increased system scheduling frequency, conditional firm services) can go a long way toward integrating variable generation into the system. EWITS takes one step in this direction by looking at the impact of consolidated balancing authorities (control areas) on wind balancing, but there is certainly more study needed to identify the full portfolio of options available to integrate wind.

As system planners start to undertake the interconnection-wide planning funded by the stimulus, these kinds of modeling exercises will form an important foundation for the analysis needed to extend wind integration studies into system planning and, eventually, implementation. Newer efforts, such as NREL's SolarDS model development, will help to better integrate rooftop and wholesale distributed solar into these kinds of modeling efforts. Also, the EWITS sister study in the west has begun to look at how utility scale solar and wind can both be deployed in large quantities. 

The challenges we face are enormous. Planning tools have been extended to unprecedented geographic scope and have begun to integrate a wide range of new resources into the generation mix. But we must still push to look at all supply *and* demand side resources at our disposal and simultaneously plan for ever-broader time horizons to meet the challenges of addressing climate change and transitioning to a clean energy economy. 

On the one hand, it has become almost cliché to call energy storage the holy grail of renewable energy and recently it seems the space is getting increasing levels of interest from investors, lawmakers, and venture funds alike. However the wind industry itself has been quick to downplay the importance of storage. In response to another recent piece on CAES Michael Goggin of the American Wind Energy Association suggested that "it's important to temper enthusiasm about storage with the recognition that wind power can be integrated onto the electric grid without energy storage."

The truth is that today wind is only about 2% of the US electricity supply, and at current levels of penetration wind can often be readily integrated without impacting system reliability. But wind power is growing quickly, and if it is to be a part of our nation's solution to global warming, it must continue to do so on a big scale. This means in the long term we will need every cost-effective means at our disposal to integrate renewables. This includes aggregating diverse resources (geographically distributed wind, wind and solar, etc), demand response, careful use of hydroelectric and natural gas plants that ramp quickly to balance wind's fluctuations, and yes, energy storage.

Technologies like CAES have important, unique advantages. For example, storage can be used to provide more constant power output to fill power lines. Ultimately, that means that for each unit of wind power, we need less high voltage transmission capacity, and ultimately that means less "energy sprawl". Furthermore, if wind and storage can displace coal directly by producing baseload power, that increases the greenhouse gas abatement value of wind substantially.

While there is some degree of hype in the recent buzz around these technologies, its clear storage will provide real benefits to the system as the contribution from variable renewables continues to grow. And although the variability of wind is not a barrier to its growth today, energy storage could nevertheless play a critical role in paving the way toward a clean energy future.