While some fear that global commitments have not been enough, there seems to be momentum for long-duration energy storage
COP26 is still top of mind. While some fear that global commitments have not been enough, there seems to be momentum for long-duration energy storage (LDES). There was a newly announced LDES Council, made up of 25 founding members, including BP, Siemens Energy, and Breakthrough Energy Ventures. The council said it would publish a report on LDES technologies in late November, with the aim of enabling 1.5-2.5 TW of capacity and 85-140 TWh of LDES globally by 2040. This will require $1.5 to $3.0 trillion of investment.
Are we finally ready for LDES to play a significant role? I think so, but so many questions about technological readiness, cost, market need, and policy still exist.
Are LDES technologies commercially ready? The short answer is yes, but in limited cases.
First, let’s define what we mean by long-duration, since there are conflicting definitions. While the LDES Council does not clearly define a duration, the US Department of Energy (DOE) defines long-duration as 10+ hours of storage capacity. Typically, Li-ion technologies operate for 6 hours or less at rated capacity, so my focus here is on non-lithium options at 10+ hours.
Pumped hydropower. Water pumped to a high reservoir during low power demand and released during high represents 95% of all energy storage in the United States, according to the Department of Energy (DOE). The technology is mature, but construction costs are high and limited geographically.
Hydrogen. Hydrogen, used already in a limited capacity for fuel cell vehicles, heavy industry, and fertilizer production, usually is produced through steam reforming of natural gas. To turn such “gray” hydrogen “green” and then to store it for long durations, surplus renewable electricity can convert water into hydrogen via electrolysis. “Power to gas” technology can use existing natural gas infrastructure and/or underground caverns to manage hydrogen energy seasonally. Due to system complexity and cost, the hydrogen infrastructure will take at least 10 years to develop, though pilot projects operate already.
Flow batteries. These circulate liquid electrolytes through battery stacks to generate electricity via the redox reaction. Vanadium chemistry is most prevalent, but other chemistries are also in the mix. Some argue that flow batteries fill the gap between shorter-duration Li-ion batteries and seasonal storage. Even with large investments in companies like Invinity and ESS Inc., the jury is out on flow battery readiness. (See “Can Flow Batteries Compete With Li-ion?”).
Gravity storage. Energy Vault has a conceptual solid mass equivalent of pumped storage, with automatic cranes creating a tower of 35-ton blocks that drop back down when energy is needed. This technology receives much attention but is brand new, so its durability is uncertain. Compressed air energy storage (CAES). This requires natural or man-made caverns or giant tanks in which air is pressurized and released to power a turbine. Technology from Canadian company Hydrostor uses water to pressurize air in man-made caves or abandoned mines. CAES is promising but is limited geographically.
Liquid air. Here, electricity cools air to a liquid, which, when warmed and released as a gas, spins a turbine. British company Highview Power has three such projects (250-400 MWh) with output durations of more than 10 hours. But there’s a high cost to liquefy the air.
Metal-air batteries. US-based Form Energy recently unveiled chemistry for an iron-air-exchange battery—using iron pellets that rust in oxygen and then revert to iron when the oxygen is removed. The company claims that the battery can store 100 hours of energy at less than $20/kWh. This technology is new, so there’s a way to go before it is commercially viable.
Is LDES cost competitive? Short answer, no. Across the board, costs need to drop by an order of magnitude.
The US DOE encourages the LDES market investment through the Energy Earthshots Initiative, which seeks to “accelerate breakthroughs of more abundant, affordable, and reliable clean energy solutions within the decade.” The initiative targets a 90% cost reduction—to $10-$35/kWh by 2030—for grid-scale systems that deliver 10+ hours of duration.
Research from Stanford University suggests that the cost will need to fall even further, to $5/kWh, to be viable in the long run, and this depends heavily on the blend of renewable sources available. For example, expanding offshore wind production may provide more reliable power that reduces the need for energy storage to shift energy for long durations.
A 2020 DNV study suggests that seasonal storage can be cost competitive, in time. Key influences will be the increase of electric vehicle demand and the ability to supply energy to the grid. The study also points to synthetic fuels as being a major contributor to the LDES market cost decline.
What policy drives the US market toward LDES? Honestly, not much. And even the news out of COP26 is about a group of LDES CEOs and financiers, not policy makers. Most mandates and incentives do not differentiate between short- and long-duration storage. This is a clear disadvantage for LDES manufacturers and developers as they try to find a foothold within the crowded storage market.
A few policies and incentive programs exist, however, including the recently passed Infrastructure Investment and Jobs Act, where some funding is directed specifically to LDES, and an LDES demonstration joint initiative with Department of Defense ($150 million), authorized in the 2020 Energy Act. Also, California recently announced a $15 billion climate package (Newsom Signs $15 Billion Climate Package) including $350 million of support for “pre-commercial” LDES projects. Both policy announcements are a step in the right direction, but more will need to be done to incentivize long-duration storage to make it competitive.
Is there a market need for LDES? Yes--there is a growing consensus that LDES will be critical to fully decarbonize electricity production, especially as renewable energy production increases. If a specific storage technology can simultaneously store for long duration (seasonally) and short duration (hourly or daily), this would be the holy grail. More realistically, there will be separate storage technologies for various durations and applications, meaning that long-duration storage may come in fits and starts.
According to a recent Strategen report, for example, from 2030 onward energy storage additions to the electric system will need a combination of short- and longer-duration resources that can enable daily cycling of solar, meet evening ramp-up requirements, and enable renewable energy to be consumed overnight and seasonally. The report found that California alone could need 45-55 GW of long-duration energy storage by 2045.
So, is it finally time for LDES? Yes, but it needs to happen faster and with clearer objectives. For example, we need a clearer definition of “duration” (that is, how do we consider 4+ hours vs. 12+ vs. 100+ vs. seasonal?); and we need to define value to LDES purchasers. DNV can help clients with these issues; and hopefully the LDES Council will create necessary clarity. There is a vested interest in growing this market—but there is still a long way to go to build tangible policy, cost reduction, and technical maturity.