Large-Scale Energy Storage

Dave Mooney, Ph.D.

GCEP Tutorial Series
October 14, 2015

NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.
Why is everyone talking about
energy storage?
2
Understanding Large-scale Energy Storage

Questions well address in todays tutorial:

Why does energy storage matter?
What are key energy storage technologies?
How much energy storage is online today?
What are key R&D areas for storage
technology?
How much renewable generation can go on the
grid before storage is required?

3
 Energy Storage: Why It Matters

Key References
DOE/EPRI Electricity Storage Handbook (2015)
Electricity Storage Schlumberger SBC Energy
Institute (2013)
Renewable Electricity Futures Study (2012)
 Electric Grid: A Matter of Balance
Supply

Supply Demand
Components Components

Storage Storage

Renewable Electric
Generators Vehicles

Conventional Stationary
Generators End Use

Demand

The electric grid balances supply and demand at all times

and operates at timescales from seconds to days.
5
Conventional Utility Operations

Hydro

Combined Cycle Gas

Coal

Nuclear

Utilities are accustomed to managing variability and

uncertainty in the load with dispatchable generation.
6
Wind and Solar Add Variability to Supply Side

Wind and solar add variability and uncertainty to the

generation supply, increasing the need for grid flexibility.
7
Solar Variability

8
Solar Variability

9
Flexibility Essential to Maintaining Balance

Supply-Side Demand-Side
Flexibility Flexibility

Storage Storage

RE Demand
Curtailment Response

Flexible
Smart Loads
Generation

Storage is one of many options for providing more

flexible supply and demand at multiple timescales.
10
Market Design Impacts Flexibility Options
Days
Energy Capacity
Markets Markets
Ensure
resource
Dispatch adequacy
grid
Hours resources
on
Ancillary economic
Services basis
Markets
Provide
Minutes fast
response
to
changes
in load to
maintain
frequency
stability

Seconds

Market design can impact operational mechanisms to

support power system flexibility and reliability.
11
 Energy Storage Applications Span the Grid
TRANSMISSION
GENERATION
Centralized or
Large centralized
distributed energy
energy storage for
storage for time-shifting
energy
Centralized renewable generation,
management and
Generation congestion
ancillary services
management, and
Transmission upgrade deferments
Lines

END USERS
Energy storage for
backup or high-
DISTRIBUTION quality power for
Energy storage to Distribution commercial and
support small Lines industrial users
distributed
generation, energy
management, and to END USERS
help defer system Small scale energy
upgrades storage for residential
and commercial
backup, time-shifting
and micro-generation

12
 Storage Can Help Smooth the Demand Curve

Seconds-to-Minutes and
Minutes-to-Hours
Storage helps follow the variation
in net load.

Hourly
Storage smooths the load to
avoid activating more
generation.

Daily, Weekly, Seasonally

Storage reduces the peak/off Time
peak range during periods of
peak demand.

Storage can work at all timescales to smooth

peaks and valleys in the demand curve.
13
Energy Storage Technologies:
Characteristics and Applications
Grid Application Depends on Storage Characteristics

Different technologies can address different grid needs, but no

single storage technology, in the near term,
is likely to meet all grid applications.
15
Storage Technology Maturity
Type Laboratory / Pilot / Demonstration Commercial / Mature
Research Development Deployment
Mechanical Pumped
Storage
Hydro
Electro- Adiabatic Compressed Air Compressed Air
mechanical Compressed Air Energy Storage Energy Storage
Energy Storage (2nd gen) (1st gen), Flywheel
Energy Storage

Thermal Molten Salt Energy

Storage
Electrical Nano- Supercapacitor,
Supercapacitor Superconducting
Magnetic Energy
Storage
Electro- Zn/air, Zn-Cl, Li-ion, Fe/Cr, ZnBr, NiMH, Lead-Acid, NiCd, Lead-Acid
chemical Advanced Li-ion, NaNiCl2 Advanced Lead- Sodium-Sulfur Batteries
Novel Battery Acid, Li-ion Batteries, Li-ion
Chemistries Batteries

Chemical Hydrogen Storage, Hydrogen storage

Synthetic Natural
Gas Storage

Most storage technologies need to mature. Pumped

storage is the only technology deployed at GW scale.
16
Pumped Storage Hydro

Primary Application: Energy Management

17
Pumped Storage Hydro

Global Operational Capacity: ~142 GW

U.S. Operational Capacity: ~20 GW

Technology Characteristics
Power Capacity: 100 1,000 MW
Discharge Time: 4 12 hours
Response Time: seconds - minutes
Efficiency: 70-85%
Lifetime: >30 years

Primary Grid Application

Energy Management

nrel.gov/docs/fy15osti/62361.pdf
18
Pumped Storage Hydro
Pros
Cheapest way to store large
quantities of energy with high
efficiency over a long time
Mature technology

Cons
Lack of suitable sites
Not fitted for distributed generation
Relatively low energy density results
in indirect environmental impact

nrel.gov/docs/fy15osti/62361.pdf
19
Thermal Storage

Primary Grid Application: Shifting or smoothing output

for Concentrating Solar Power
20
 Molten Salt Energy Storage
Global Operational Capacity: ~1.3 GW
U.S. Operational Capacity: 281 MW

Technology Characteristics
Power Capacity: MW Scale
Discharge Time: hours
Response Time: minutes
Efficiency: 80-90%
Lifetime: 30 years

Primary Grid Application

Shifting and smoothing output for CSP
plants

2013 SBC Institute. Used with permission.

21
 Molten Salt Energy Storage
Pros
Commercial
Large scale
Most economically viable storage for
solar

Cons
Niche for concentrating solar power
plant applications
Molten salts can be corrosive

2013 SBC Institute. Used with permission.

22
Electrochemical Storage

Multiple Grid Applications: Smoothing RE output, black start

services, T&D Deferral, shifting RE output
23
 Lithium-Ion Batteries
Global Operational Capacity: 287 MW
U.S. Operational Capacity: 115 MW

Technology Characteristics
Power Capacity: W to MW
Discharge Time: 1 minute 8 hours
Response Time: 10-20 milliseconds
Efficiency: 85-98%
Lifetime: 5-15 years

Primary Grid Application

RE smoothing
RE output shifting
T&D investment deferrals

2013 SBC Institute. Used with permission. nrel.gov/docs/fy15osti/62361.pdf

24
 Lithium-Ion Batteries
Pros
High efficiency
Extensive experience for portable
applications
Suitable for small to medium scale
applications

Cons
Limited lifecycle
Environmental and safety
considerations
Thermal management

2013 SBC Institute. Used with permission. nrel.gov/docs/fy15osti/62361.pdf

25
26
Tesla Gigafactory

27
Tesla Gigafactory

28
Supercapacitor

Primary Grid Application: Power Quality

29
 Supercapacitors
Global Operational Capacity: NA
U.S. Operational Capacity: NA

Technology Characteristics
Power Capacity: kW - GW
Discharge Time: milliseconds - minutes
Response Time: 10-20 milliseconds
Efficiency: 80-98%
Lifetime: 4-20 years

Primary Grid Application

Power Quality/Voltage Support

2013 SBC Institute. Used with permission. nrel.gov/docs/fy15osti/62361.pdf

30
 Supercapacitors
Pros
High efficiency
High cycle fatigue
Scalable/flexible
High power

Cons
Low energy
Requires power conditioning to
deliver a steady output power
Expensive per unit of energy capacity

2013 SBC Institute. Used with permission. nrel.gov/docs/fy15osti/62361.pdf

31
Chemical Storage

Primary Grid Application: Intermittent balancing

32
 Hydrogen Storage
Global Operational Capacity: ~10s MW
U.S. Operational Capacity: NA

Technology Characteristics
Power Capacity: kW - GW
Discharge Time: hours
Response Time: seconds - minutes
Efficiency: 24-45%
Lifetime: 5-30 years

Primary Grid Application

Power Quality
Intermittent Balancing

2013 SBC Institute. Used with permission. nrel.gov/docs/fy15osti/62361.pdf

33
 Hydrogen Storage
Pros
Scalable from distributed to large
scale long term large-scale storage
Low environmental impact

Cons
Low round-trip efficiency
High capital cost
Safety considerations
Low energy density at ambient
conditions

2013 SBC Institute. Used with permission. nrel.gov/docs/fy15osti/62361.pdf

34
Storage R&D
Novel materials
o Anodes
o Cathodes
o Electrolytes
Higher efficiency
Higher energy density
o Energy per unit mass
o Energy per volume
Longer lifetimes
o Greater number of cycles
o Deeper discharge
Lower costs
Form factor
Thermal management
nrel.gov/docs/fy15osti/62361.pdf
35
Energy Storage: How Much is in Use?
Interest in Energy Storage Rises and Falls
Renewed interest
Deployment of
in energy storage as
pumped hydro
RE deployment
storage
expands and fuel
accelerates to
prices rise
meet variation in
demand.
Gas prices drop.
Nuclear buildout
smaller than
expected.
Storage was an Restructured
attractive markets, state
alternative to other mandates and
load-following increased R&D
generators for funding expand
supporting opportunities for
projected growth Cheaper and/or easier
storage
in nuclear power. to meet variation in
load and capacity
requirements with
conventional generation
resources
37
U.S. Energy Storage Operational Capacity

~21 GW Total
Capacity

DOE Global Storage Energy Database

http://www.energystorageexchange.org/projects/data_visualization
(accessed 25 August, 2015)

Pumped Storage Hydro is the dominant

energy storage technology in the U.S.
38
Global Energy Storage Operational Capacity

~148 GW
Total

DOE Global Storage Energy Database

http://www.energystorageexchange.org/projects/
data_visualization (accessed 25 August, 2015)

Pumped Storage Hydro is the dominant

energy storage technology globally.
39
Energy Storage Projects in the Pipeline: U.S.

~6 GW
159 Projects

40
Energy Storage Projects in the Pipeline: Global

36 GW
325 Projects

41
Challenges and Barriers Facing
Energy Storage
Challenges for Storage

Storage is not the most economic way to add flexibility to the grid.
Plus, policy/regulatory/market landscape constrains ability to
capture full value.
43
Energy Storage Economics Example:
Estimated Storage Cost for
Bulk Energy Storage

Bulk Energy Storage Options

to Support System and Large
Renewable Integration
Applications:
o Wholesale Markets
o Wind Integration
o Ancillary Services

Estimated cost for bulk energy

storage ranges from $980 4900/KW

Current markets support bulk storage

at costs <$2000/kW for a >6 hr device
44
Approaches to Estimating Storage Value
Based on Market Price
o Revenues correspond to the price in markets where
storage operators can bid
e.g. capacity market, frequency regulation market, black-start
services, price-arbitrage
Based on Avoided Costs
o In the absence of a market, the benefits of electricity
storage can be assessed implicitly by evaluating the costs
avoided because of investment in storage
e.g. deferral of transmission & distribution investment, reduced
transmission congestion charges
Based on Competing Technology/Willingness to Pay
o If electricity storage has an intrinsic value, it can be
assessed by comparing alternative technologies
e.g. ensuring power quality for end-users, optimization of the
power fleet by storing excess power from renewables instead of
shutting down baseload power plants
45
 Cost-Benefit for Grid Applications
Current cost
of storage
technologies
~$2,000/kW
and greater

Source: https://fas.org/sgp/crs/misc/R42455.pdf

For most applications, the current costs of energy storage outweigh the
financial benefits
Arbitrage alone is generally insufficient to support most storage technologies
Regulation and contingency reserves yield the greatest value
46
Market and Regulatory Challenges
Ability to participate in ancillary services
o Storage is not always eligible to participate in ancillary services
(markets or bilateral agreements) nor to resource adequacy. This is
particularly true for small capacity storage due to a minimum size
required
Ownership of storage plant
o In several unbundled systems, storage is considered a production asset
and system operators (transmission or distribution) are not allowed to
own storage devices. This is a strong impediment to transmission and
distribution deferral applications that are considered to be among the
most promising revenue streams
Monetization of fast-response assets
o Frequency regulation usually rewards MW withdrawn or injected to
stabilize the grid without taking into account the speed of the
response;

Market Rules and Regulatory Frameworks Make it

Difficult to Monetize All the Benefits of Storage
47
California Storage Initiative

1.325 GW of non-pumped-hydro storage by 2020

o Transmission (700MW)
o Distribution (425 MW)
o Behind the meter (200 MW)
Objectives
o The optimization of the grid, including peak reduction,
contribution to reliability needs, or deferment of
transmission and distribution upgrade investments;
o The integration of renewable energy; and
o The reduction of greenhouse gas emissions to 80 percent
below 1990 levels by 2050, per California goals.

48
Storage Applications Valued In Todays Electricity Markets
Valued in Restructured Markets? Yes Partially, or indirectly No

Storage value depends on application AND technology characteristics.

Energy markets and regulations dont value full benefits of storage.
49
How Much RE Before Storage is
Required
Flexibility Supply Curve
RE resource forecasting
Expanded transmission
Smarter distribution system
Smarter loads

51
Renewable Futures Study Scenarios - 2050

52
 david.mooney@nrel.gov
Key References
DOE/EPRI Electricity Storage Handbook (2015)
Electricity Storage Schlumberger SBC Energy
Institute (2013)
Renewable Electricity Futures Study (2012)
Why is everyone talking about energy storage?
It could be a game changer.
55
Backup Slides
57
58
 Early Storage Build-Out

CAES: 1 Plant (110

MW), Alabama

Others (~100 MW
total): A few
batteries, SMES,
mostly for local
power quality issues

Conventional Pumped Home systems

storage
Hydro: ~ 22 GW

59
U.S. Federal Mandates and Incentives
FERC 755 (October 2011): Pay for Performance for Frequency
Regulation
Entities providing this service will be compensated in a two-part
structure:
First, regulation service providers will receive a capacity payment.
Second, regulation providers will receive a "performance-based" payment.
FERC 1000 (July 2011): Regional Transmission Planning
The order specifies how public utility transmission providers plan for
new transmission projects and allocate those costs.
Reliability transmission upgrades, market efficiency transmission
upgrades and public policy transmission upgrades
FERC 784 (July 2013): Third Party Provision of Ancillary Services
FERC Order 792 (November 2013): Small Generator Interconnection
Procedures
Added energy storage as a power source that is eligible to connect to
the grid, following procedures similar to those for small generator
interconnection.

60
Applications of Energy Storage
Application Description Timescale of Operation

Load Leveling/ Purchasing low-cost off-peak energy and selling it Response in minutes to hours. Discharge time of hours.
Arbitrage during periods of high prices.
Firm Capacity Provide reliable capacity to meet peak system Must be able to discharge continuously for several hours or more.
demand.
Operating Reserves Fast responding increase or decrease in Unit must be able to respond in seconds to minutes. Discharge time
Regulation generation (or load) to respond to random, is typically minutes. Service is theoretically net zero energy over
unpredictable variations in demand. extended time periods.

Contingency Fast response increase in generation (or Unit must begin responding immediately and be fully responsive
Spinning decrease load) to respond to a contingency such within 10 minutes. Must be able to hold output for 30 minutes to 2
Reserve as a generator failure. hours depending on the market. Service is infrequently called.[2]

Replacement/ Units brought on-line to replace spinning units. Typical response time requirement of 30-60 minutes depending on
Supplemental market minutes. Discharge time may be several hours.

Ramping/Load Follow longer-term (hourly) changes in electricity Response time in minutes to hours. Discharge time may be
Following demand. minutes to hours.
T&D Replacement Reduce loading on T&D system during peak Response in minutes to hours. Discharge time of hours.
and Deferral times.
Black-Start Units brought online to start system after a Response time requirement is several minutes to over an hour.
system-wide failure (blackout). Discharge time requirement may be several to many hours.[3]
End-Use
Applications Functionally the same as arbitrage, just at the Same as arbitrage.
TOU Rates customer site.
Same as firm capacity.
Demand Charge Functionally the same as firm capacity, just at the
Reduction customer site. Instantaneous response. Discharge time depends on level of
reliability needed by customer.
Backup Power/ Functionally the same as contingency reserve,
UPS/Power Quality just at the customer site.

61
Energy Storage in Restructured Markets
Application Valued in Restructured Markets?
Load Leveling/ Arbitrage Yes
Firm Capacity Via scarcity pricing or combined scarcity plus capacity markets.
Suffers from missing money problem.
Regulation Reserves Yes, with potentially increased compensation for fast response
through FERC 755 initiated market reforms
Spinning Reserves Yes
Replacement/Supplemental/N Yes but values are very low
on-Spinning
Primary Frequency Response No. Early stage proposals
/ Inertia
Ramping/Load Following No. Proposed in several markets
Transmission Replacement Only partially via congestion prices
and Deferral
All Distribution Specific No. Will likely remain cost of service through regulated entities
Applications
Renewable Integration Captured through other services.
End-Use Applications Only via rate structure, perhaps combined with aggregated
wholesale services (adds transaction costs)

62
Value of Storage in Restructured Markets
Historical Values of Energy Storage in Restructured Electricity Markets

Market Location Years Annual Value Assumptions

Evaluated Evaluated ($/kW)

Energy PJMa 2002-2007 $60-$115 12 hour, 80% efficient device. Range of

Arbitrage efficiencies and sizes evaluated[1]
NYISOb 2001-2005 $87-$240 10 hour, 83% efficient device. Range of
(NYC) efficiencies and sizes evaluated.
$29-$84
(rest)
USAc 1997-2001 $37-$45 80% efficient device, Covers NE, No Cal, PJM

CAd 2003 $49 10 hour, 90% efficient device.

Regulation NYISOb 2001-2005 $163-248

USAe 2003-2006 $236-$429 PJM, NYISO, ERCOT, ISONE

Contingency USAe 2004-2005 $66-$149 PJM, NYISO, ERCOT, ISONE

Reserves
a Sioshansi et al. 2009
b Walawalkar et al. 2007
c Figueiredo et al. 2006
d Eyer et al. 2004
e Denholm and Letendre 2007

63
Current Capacity

64
Demonstration Projects via ARRA

From : Energy Storage Activities in the United States Electricity Grid, May 2011

65
ARPA-E Projects

66

66
ARPA-E Projects

About $58
million total

67
Current Wind and Solar Integration Studies
We have extensively studied the impacts of wind and solar in the
range of 35% penetration on an energy basis.
Increased variability can be accommodated by existing generator
flexibility and other low-cost flexibility such as increased balancing
area cooperation (balancing wind generation and load over larger
areas to share the increased variability.
Spatial diversity smooths aggregated wind output reducing short-
term fluctuations to hour time scales
Almost all the wind can be used (little curtailment)
All the wind acts to reduce fuel use and emissions from existing plant
Additional reserves have a modest impact on the emissions reduction
rate
Storage would be nice, but timing is uncertain

68
Energy Storage Technologies: Characteristics

69
Energy Storage Technologies: Characteristics

70
U.S. Energy Storage R&D Support

R&D Focus: R&D Focus:

Battery storage for utility load shifting or High-risk, high-payoff rampable and
wind during operation and ramping control dispatchable intermittent storage projects
Frequency regulation ancillary services
Distributed storage for grid support
1GRIDS: grid-scale rampable intermittant
CAES
dispatchable storage
Demonstration of promising storage
technologies

71
Role of Storage in Integrating Variable Renewables

Significant perception that storage is needed to integrate renewables

72
Estimated Operational Energy Storage (MW)
Storage Technology United States Worldwide
Pumped Storage Hydro 20,356 142,088
Thermal Storage 553 1,722
Molten Salt Thermal Storage 281 1,337
Flywheels 56 920
Compressed Air Storage 114 435
Batteries 242 525
Lithium-ion Batteries 115 287
Sodium based Batteries 22 102
Lead-acid Batteries 76 86
Nickel based Batteries 27 30
Flow Batteries 2 19
Electro-chemical 56 80
Hydrogen Storage 0 3
Grand Total 21,376 145,771

73