A few things happened while I was out last week studying the potential energy stored in my body at the top of a ski slope (very serious work).
Chief among them, President Donald Trump kicked off the effort to dismantle the carbon regulations in the Clean Power Plan, and lifted the Obama administration's moratorium on coal leasing on federal lands, which was put in place as a temporary measure while developing modernized leasing procedures.
It's clear that this effort will not achieve the president's stated goal of bringing back coal jobs. It fails to address the most pressing causes of coal job decline: competition from cheap natural gas and the mechanization of labor. The impacts on energy storage are less clear.
A slowdown in renewables deployment would incrementally lessen the demand for storage associated with variable generation technologies, like firmed solar plants, renewable energy smoothing applications, and grid-scale storage to discharge for the evening ramp in solar-heavy markets.
That outcome is unlikely, though. A recent survey of utility executives by Utility Dive found they had the highest margins of confidence in the growth of utility-scale solar, distributed generation, distributed storage and grid storage. Only 4 percent predicted an increase in coal use. Those numbers could change marginally in light of the executive order, but the top-level trend is clear. Renewables are here to stay, and coal ain't coming back -- at least not in a major way.
A different use case could be more vulnerable: storage for peak load capacity. Many a storage vendor has been making the case that advanced batteries are better suited to serve the grid for moments of peak demand than are expensive gas peaker plants, which only fire up a few hours out of the entire year.
If the federal government rolls back regulations that tamp down carbon emissions and makes domestic fossil-fuel extraction easier, it could marginally decrease the costs of gas peakers relative to upstart storage offerings. It's hard to imagine that overcoming the downward trend in lithium-ion pricing, but it could be noticeable.
In any case, storage still benefits from a politically neutral public reputation -- to the extent that it even has a public reputation. As members of the storage industry framed it in a letter sent Monday to congressional leaders, "Energy storage systems are also fuel-neutral and help any generation resource connected to the grid -- whether fossil or renewable -- become more efficient, productive and competitive."
So do what you will to renewables (the evidence suggests they'll keep growing anyway); storage can still strengthen the grid and save utilities money regardless.
The old becomes new
Storage software specialist Greensmith tells us the company has completed a software retrofit of an existing battery, upgrading the asset's ability to provide lucrative grid services without any change to the hardware itself.
Five years ago, utility American Electric Power installed a 2-megawatt/14-megawatt-hour battery system in West Virginia to back up its distribution network there. These days, though, you can't truly be said to be on the cutting edge with batteries unless you're into "value-stacking."
"If it's just sitting around a good amount of the time, it's better to leverage its capacity for something," said GTM Research storage analyst Brett Simon.
So, AEP tapped Greensmith to add a new ability.
Distribution backup typically serves to defer other capital investments a utility would need to make in the local grid. By adding frequency regulation for the PJM market, Greensmith has created a new revenue stream for AEP (which made a strategic investment in Greensmith back in 2015).
Notably, Greensmith says it did this without touching any hardware in the storage system itself. This is the first I've heard of a remote retrofit to give existing batteries new value streams. Given the relative newness of advanced batteries on the grid, the market for these sorts of retrofits won't be enormous. Still, it's noteworthy that this can be done, and that an investment in a battery can lead to new forms of revenue down the road.
Zibelman talks batteries in Australia
Audrey Zibelman has completed the move from chair of New York's Public Service Commission to CEO of the Australia Energy Market Operator.
She arrived on the heels of statewide blackouts that have some in the country blaming the closure of coal plants and the surge in renewables. It turns out, this isn't the first time Zibelman has stepped into the aftermath of a major grid failure with the task of reforming the whole system. As she said in an early public appearance in Australia, she arrived in her previous role just after Superstorm Sandy smashed into New York, leaving elderly folks to climb down tens of stories to get essential supplies.
There's nothing like a crisis to break through entrenched ways of doing things. We can expect some movement in Australia's grid in the years to come, and it will certainly involve energy storage.
"If we compensate people who invest in batteries or distributed generation on their side of the meter, and we really create a two-way system, then we create a more productive system, meaning you don’t have to invest in generation that you are only going to use a few hours a year, because you can use the load itself as a balancing resource," RenewEconomy quoted Zibelman as saying at the event.
As I've reported for Squared, Australia already has more favorable residential storage economics than the U.S. If Zibelman succeeds in crafting market mechanisms like the ones she described, the cost-benefit analysis will grow even stronger.
A little light reading: Solar-plus-storage cost benchmarks
There's plenty of literature on solar soft costs, but the barriers to widespread solar-plus-storage adoption are a less studied phenomenon.
Until now. Researchers from NREL and the Rocky Mountain Institute released a big new report breaking down all the cost drivers that go into installed costs for residential PV-plus-storage systems.
The small battery system they modeled -- 5.6 kilowatts of PV and a 3-kilowatt/6-kilowatt-hour battery -- derives half its cost from hardware components, and the inverter and PV array each outweigh the battery on price. In the large battery case (5 kilowatts/20 kilowatt-hours), hardware charges make up more than 60 percent of the price, and the battery costs more than anything else.
It's a good study to bookmark for future S+S reference. Kudos to the authors for exceptionally clear illustrations of the differing electricity pathways for AC-coupled versus DC-coupled systems. The real value will come from comparing the initial benchmarking with future editions, to see where soft costs fall and where they don't. The authors say they'll be back with more in this series, leaving us readers hanging with an intriguing "To be continued..."