Sparks

BESS practice on energy storage

 By Andrew Burger

Refined and scaled up from their initial application in consumer electronics devices, use of the latest stationary lithium ion (Li-ion) batteries is sweeping across U.S. and international power markets and industry. In the U.S., stationary Li-ion battery-based energy storage systems (BESS) were first deployed at utility scale in power markets where regulatory ¨first movers,¨ such as California and regional grid operator PJM Interconnection deemed them acceptable power grid generation or distribution assets. The trend is international in scope. South Korea’s largest utility, Korea Electric Power (KEPCO), recently announced it had deployed the largest grid-connected BESS system for frequency regulation to date – a 24MW/9MWh Li-ion NMC (Nickel Manganese Cobalt Oxide) BESS developed by Kokam. Applications at this scale are still few and relatively new, but performance data is accumulating. That’s helping utilities, investors and regulators get a better handle on the economics of Li-ion BESS technology, indicators highlighting the additional benefits the technology affords stakeholders, and new policies that could further fuel deployments…

Scaling up from their initial application in consumer electronics (CE), lithium-ion (Li-ion) batteries use is sweeping across the U.S. and international power markets.

Deployments in the U.S. have been growing fast in markets where ¨first movers,¨ including regional grid independent systems operator PJM Interconnection and states such as California, Hawaii and New York, have initiated supportive policies and programs, and set ambitious goals.

Federal and venture capital funding enabled pioneering startups to create the first ¨intelligent¨ Battery Energy Storage System (BESS) platforms capable of aggregating and managing energy storage capacity distributed across both the utility and customer sides of the meter. Leading multinational industrial engineering and high-tech corporations, such as GE and IBM, as well as investor-owned utilities, such as AES and Duke Energy, soon followed.

The trend is now global in scope. South Korea’s largest utility, Korea Electric Power (KEPCO), recently announced it has deployed the largest grid-connected BESS system for frequency regulation to date — a 24MW/9MWh Li-ion Nickel Manganese Cobalt Oxide (NMC) BESS developed by Kokam.

Source: www.sinergyfiles.com

An Industry First

Utility-scale installations of integrated BESS systems are few and far between, but performance data are accumulating. That’s helping utilities, regulators and developers get a better handle on BESS economics, and informing development of new business models, market strategies and regulatory policies.

Marking a first for the U.S. power industry, last September a “smart” network of Li-ion BESS installed ¨behind the meter¨ on the premises of 18 Pacific Gas & Electric customers successfully bid into and dispatched electricity to California’s grid via the California Independent System Operator (CAISO) real-time, day-to-day wholesale power market.

Designed and installed by Silicon Valley-based Stem and Olivine, the platform functions as one large grid energy storage asset. “Stem’s participation in CAISO proves out the theory that customer-sited energy storage can be used to provide multiple services from a single asset,” Stem’s director of policy Ted Ko said in an interview.

Gaining Credibility

Population centers with high energy costs (e.g. islands and remote communities) and service territories where energy storage goals and incentives have been instituted opened the door to the first applications of distributed BESS technology. Notable among the latter is PJM Interconnection, which deployed 160 MW of battery-based energy storage capacity in 2015.

In addition, U.S. states have enacted energy storage legislation, policies and incentives. California was the first, enacting AB2514 in 2013, which requires the state’s three principal investor-owned utilities to acquire 200 MW of storage capacity by year-end and 1.325 gigawatts (GW) by 2020.

Why energy storage is about to get big and cheap (www.rameznaam.com)

Open Questions

The purchase price of Li-ion BESS has been falling fast – from around $500 to around $350 per kilowatt-hour (kWh), but installed costs and the levelized cost of energy (LcoE) are still too high to warrant broad-scale deployment.

¨You’re probably looking at close to $1,000/kWh all in to build and commission a grid-scale Li-ion BESS system, perhaps a bit less for a residential system,¨ Lux Research’s Chris Robinson told Eniday.

Furthermore, a variety of stationary Li-ion battery technologies are available on the market, as are alternatives such as redox flow batteries. KEPCO, for example, is making use of Li-ion titanite (LTO) BESS as well as NMC systems. Following are the five leading Li-ion battery technologies. (Note: The first four are cathodes while the fifth is used for Li-ion battery anodes.)

  • Lithium Manganese Oxide (LiMn2O4 or LMO)
  • Lithium Nickel Manganese Cobalt Oxide (LiNiMnCoO2 or NMC)
  • Lithium Iron Phosphate(LiFePO4 or LFP)
  • Lithium Nickel Cobalt Aluminum Oxide (LiNiCoAlO2 or NCA)
  • Lithium Titanate (Li4Ti5O12 or LTO)

Adding to the value proposition but complicating things further, the latest BESS technology is flexible enough to provide multiple valuable services. These include faster renewables integration, more efficient primary and reserve generation and distribution capacity, and enhanced ancillary transmission services, such as frequency and voltage regulation.

These enhancements in efficiency, stability and resilience are expected to result in lower, more stable electricity costs, as well as reduce greenhouse gas emissions and the need for utilities to invest in grid infrastructure.

 

SEE MORE: Is hydrogen the future of the car? by Mike Scott

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Comparing Stationary Li-ion Battery Technologies

Customer orders for Tesla’s Powerpack and Powerwall residential and commercial/utility Li-ion BESS product lines poured in following their April 2015 launch, enough for Tesla CEO Elon Musk and executives to consider increasing the capacity of the massive Li-ion battery ¨Gigafactory¨ Tesla and Panasonic are building in southern Nevada by 50%, perhaps more, Lux Research points out in a research paper.

Tesla recently discontinued the larger, 10 kWh Powerwall due to lack of customer interest, however. Low daily cycling capacity was seen as a principal factor. Tesla has been using NCA cathodes in the product.

Made to Order

Tesla’s decision highlights the different properties of the five leading Li-BESS technologies, which lend themselves to particular applications and market strategies, Robinson explained.

Grid services typically require high power density, long cycle life and high charge/discharge rates. ¨If you need a lot of power, you generally look to LTO anodes. They have long cycle life and also provide a lot of power.¨

That said, Li-ion batteries with NMC, and secondarily LFP, cathodes are the most popular for grid applications, more specifically when there’s a need to integrate lots of renewable energy on to the grid. LiNMC batteries have better cycle life and better energy properties, he pointed out.

NMC and LFP are also the most popular when it comes to residential applications. ¨You can get away with using NCA if you’re just looking for emergency back-up power, but there’s really very little in the way of revenue opportunities – such as demand charge reduction, peak load shaving, time of use shifting or the flexibility to charge from solar panels,¨ he elaborated.

Robinson said it will probably be another five years before Li-ion BESS prove profitable. A lot’s riding on the energy investment and deployment decisions governments, utilities, corporations and consumers make today, however; not the least of which is the likelihood of reversing the rising trend of anthropogenic GHG emissions.

The prospects of lower, more stable energy costs, enhanced efficiency, reliability and resilience, and GHG reductions are the principal benefits BESS stakeholders are touting as they look to improve their technologies and add momentum to a growing, rapidly evolving market.

about the author
Andrew Burger
Andrew Burger has been reporting on energy, technology, political economy, climate and the environment for a variety of online media properties for over five years.