Guest Juice: Energy Storage Prospects Rise with Fall in Renewable Costs

20 Jan 2020

By Wayne Hicks

An oft-repeated refrain—the sun doesn’t always shine, and the wind doesn’t always blow—is sometimes seen as an impediment to renewable energy. But it’s also an impetus toward discovering the best ways to store that energy until it’s needed.

Declining costs in available technologies have propelled interest in energy storage forward like never before. The price of lithium-ion batteries has fallen by about 80% over the past five years, enabling the integration of storage into solar power systems. Today, nearly 18% of all electricity produced in the United States comes from renewable energy sources, such as hydropower and wind—a figure that is forecast to climb. More than 30% of California’s electricity comes from renewables. As it and other states push toward higher percentages of power from renewable resources, storage technologies are to play an important role.

Compared with the same period a year earlier, the United States saw a 93% increase in the amount of storage deployed in the third quarter of 2019. By 2024, that number is expected to top 5.4 GW, according to a forecast by market research firm Wood Mackenzie Power & Renewables. The market value is forecast to increase from $720 million today to $5.1 billion in 2024.

Only in the past decade has the widespread adoption of renewable energy sources become an economic possibility, said Paul Denholm, a principal energy analyst at the National Renewable Energy Laboratory.

“The declining cost of wind and solar and now batteries makes it conceivable to consider 100% renewables,” he said.

NREL estimated that 120 GW of storage would be needed across the continental United States by 2050, to reach an 80% renewable electricity level. The country currently has 22 GW of storage from pumped hydropower, and another gigawatt in batteries.

Pinning down the cost of storage remains elusive. A frequently used metric called levelized cost of energy allows a comparison of the cost to generate electricity by different means. But the levelized cost is only accurate when the differing technologies provide the same services.

A group of NREL researchers, including David Feldman and Robert Margolis, developed a levelized costs of energy for solar-plus-storage.

“One of the challenges, particularly for storage, is that there are so many different use cases that cost doesn’t mean much unless you are defining the value that the system brings.” Feldman said.

Using storage can save a utility money by reducing the need to generate electricity and avoiding transmission costs.

An NREL-authored paper published last year in The Electricity Journal found solar-plus-storage reduced utility costs for commercial buildings in more than half of the 17 cities examined, in some cases by as much as 24%. Using batteries for storage, the properties were able to offset a utility’s rates that require users to pay more during times of peak demand.

Peaking power plants, fueled by natural gas and switched on to help meet peak demand, run into cost comparisons against batteries capable of storing four hours of energy. For that duration, the balance tips in favor of batteries. Beyond four hours, though, the battery becomes more expensive.

“The reason why we have so many peaking plants is air conditioning,” Denholm said. “One thing you can do is instead of building a bunch of power plants that only run 100 hours a year when it’s really hot, you can store cold energy in the form of ice or something. Make ice at 4 in the morning and then, when it gets hot in the middle of the afternoon, you can release that cold stored energy and cool down your house or your building.”

A Department of Energy database counts nearly 700 storage projects announced, operational, or under construction across the United States that rely on myriad technologies. In addition to batteries, the storage methods include ice, pumped hydropower, heat, chilled water, and electrochemical.

“All of them should work together in order to achieve a certain goal, which is grid stability and resilience and to fulfill customer needs,” said Adarsh Nagarajan, NREL Power System Design and Planning Group Manager.

In addition, new or improved technologies are constantly being proposed. Researchers at NREL developed a technique to inject natural gas into depleted wells, patented a method for storing pressurized hydrogen inside specially designed wind turbines, and improved the design of lithium-ion batteries to make them last longer.

The DOE Energy Storage Technology and Cost Characterization Report calculated that among battery technologies, lithium-ion batteries provide the best option for four-hour storage in terms of cost, performance, and maturity of the technology. For a longer span, pumped-storage hydropower and compressed-air energy storage are considered the best options. Between those two, pumped-storage hydro is the more mature technology and accounted for 98 percent of worldwide energy storage deployed in 2018.

Long-term energy storage is roughly defined as from 10–100 hours. Anything over that is considered seasonal. Hydrogen, hydropower, and compressed air are the most viable technologies for storing energy over lengthy periods, according to Omar Guerra and Josh Eichman.

Working in partnership with Southern California Gas Company, N­­­REL installed a bioreactor to test power-to-gas technology as a way to store renewable energy. The project, a first in the United States, relies on microorganisms that convert hydrogen and carbon dioxide into methane. The methane can be stored in the company’s pipeline for use later.

Hydrogen can be added to the natural gas pipeline—as much as about 10%—or stored separately. One method to store hydrogen that’s been proposed—but has yet to be widely adopted—is carving out space within salt caverns, Keith Wipke, manager of NREL’s Fuel Cell and Hydrogen Technologies program, said.

Storing natural gas helps hedge against price fluctuations and meet seasonal demands, but the cost of the equipment has stalled the adoption of seasonal electricity storage. Hydrogen storage remains an emerging technology, but as research leads to improvements it’s expected to eventually be the most cost-effective method for keeping and discharging at least a week’s worth of electricity, Guerra said. 

“We need to drive the cost down on the technologies we have today,” Wipke said. Improvements also are needed.

Zhiwen Ma is working on just that. The researcher works in NREL’s Thermal Systems Group and focuses his efforts on concentrating solar power. The technology uses a series of mirrors or lenses to concentrate sunlight onto a small area, and the energy captured can be stored in molten salt. But the salts are corrosive. Instead of salt, Ma is using sand to store the heat.

DOE’s Advanced Research Projects Agency-Energy has awarded NREL $2.8 million to investigate the feasibility of Ma’s low-cost thermal energy storage system. When needed, the heated sand will heat a fluid that drives a gas turbine attached to a generator.

Ma said the sand is a fraction of the cost of the salt but can be heated to 1,200 degrees Centigrade compared to 600 degrees for nitrate salt or 800 degrees for chloride salt.

With so many options to store energy, researchers are determined to find the best methods. After all, the sun doesn’t always shine, and the wind doesn’t always blow.

—Wayne Hicks, NREL media relations representative.

Edited by Current. The original and longer version of this article is available at

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