The United States is expected to lean on non-hydro renewables — namely, onshore wind and utility-scale solar — for an estimated 10% of its total electricity in 2019. That may not seem like much, but it’s up from virtually nothing at the start of the century. And the best is yet to come.

A combination of falling costs, improving technology, and supportive state policies make it likely that onshore wind and utility-scale solar will provide at least 30% of America’s total electricity by 2030. But it’s entirely possible that all renewable power sources — including hydroelectricity, small-scale solar, and others — could generate close to half of the nation’s electricity by that date.

Getting there requires some help from two emerging technologies in particular: energy storage and offshore wind. Both opportunities are nearing an important inflection point, which means investors may want to the renewable energy stocks positioned to benefit on their radar.

Are batteries ready for prime time?
The promise of energy storage is simple to understand: Owners of wind farms and solar farms (or a rooftop solar array) could lean on batteries to smooth out the daily or weekly generation profile of their assets. For example, that could allow a solar asset to deliver electricity to the grid at night and incentivize larger solar farms, since energy storage could capture the “overflow” during the day. But residential and grid-scale energy storage products face a familiar obstacle: cost.

Discussing energy storage costs can be tricky because the economics depend on the application (small-scale vs. utility-scale, short-duration vs. long-duration) and the specific materials used in the device. Therefore, while energy storage only makes good financial sense for a limited number of applications today, there are signs that the technology is beginning to find ways into the crowded energy market.

Tesla (NASDAQ:TSLA) manufactures lithium-ion batteries for both small- and large-scale customers. It deployed a record 477 megawatt-hours of storage across all customer types in the third quarter of 2019, representing year-over-year growth of 99%. Most of the company’s business comes from grid-scale projects, which may receive a big boost soon.

At 4:52pm on Friday 9 August 2019, the UK suffered its first wide-scale blackout in more than a decade. More than 1.1 million consumers were plunged into the dark as rail lines screeched to a halt, traffic lights failed and even airports reported problems. Liam Stoker looks at the root causes, and how battery storage came to the rescue in an article which first appeared in PV Tech Power Vol.20.

16:52:33.490. Those nine consecutive digits won’t mean much outside of the UK’s energy sector, but they’re likely to be etched into folklore. It’s the precise timestamp for when, on 9 August 2019, a single lightning strike sparked a cascade of events that caused the UK’s first major blackout in more than a decade.

More than one million people experienced power outages and significant disruption, with not insignificant swathes of the country’s rail network taken out of action, albeit temporarily. The incident made national headlines for days after, as theory and rumour abounded.

A cyber attack? No, the UK’s transmission system operator National Grid quickly dismissed. Were renewables to blame? Earlier that day wind had provided more than half of the country’s power,
a feat which had the renewables lobby celebrating. That just hours later the lights had gone out was a fact not lost on a number of climate change sceptics.

But those theories were also dismissed by National Grid in the days after the event. While there was indeed marginally less inertia on the grid that day, courtesy of less synchronous generation, this was not something that ultimately contributed to the blackout.

The true cause, National Grid’s preliminary investigation, released on 19 August, was perhaps both simpler and more complicated at the same time.

Enphase’s current growth is based around its core solar microinverter business. But in discussing the company’s Q3 earnings Tuesday, CEO Badri Kothandaraman focused on how Enphase’s soon-to-launch integrated energy storage system could aid Californians facing the state’s unfolding wildfire and grid blackout emergency.

California-based Enphase is far from the only residential solar equipment provider adding batteries to the rooftop PV proposition. Sunrun, the U.S. rooftop solar leader, says that a quarter of its California solar customers are now choosing to add batteries to their systems.

While Kothandaraman declined to predict how many battery-backed Ensemble systems the company will sell, he expects similar “attach rates” to those seen by Sunrun in the California market.

The demand for solar-battery backup systems could skyrocket, Kothandaraman said, with millions of Californians undergoing days-long blackouts this month under the expanded fire-prevention power outage regime of bankrupt utility Pacific Gas & Electric.

“The blackouts in California will only increase the attach rates for storage,” he said.

Many Enphase employees live in the same PG&E territory now facing evacuations from the Kincade Fire or lengthy power outages meant to prevent more fires from starting.

“Storage has a massive potential for [Enphase],” Kothandaraman said. “It takes us from $2,000 a home to $10,000 a home” in terms of revenue per installation, he said.

“Ensemble is a technology that brings together solar, storage, inverters and even a generator on a single technology platform to keep a home’s [power] always on.”

Solar-storage systems aren’t capable of keeping most homes fully powered for more than an hour or two, leaving it up to homeowners to decide on critical loads and manage battery life to match the duration of their outage. But the Ensemble system is preconfigured to manage these complex balancing tasks, Kothandaraman said — something not all systems built from disparate parts can claim.

Iron flow battery startup ESS raised an additional $30 million to take its technology from pilots to commercial scale.

Since 2011, the company has been developing a low-cost, nonflammable long-duration storage technology to compete across domains where the dominant lithium-ion battery chemistries are weaker. Flow batteries have been one of the more prominent lithium-ion alternatives, but companies working in the space have struggled to stay afloat financially and move beyond the pilot stage.

With the new Series C investment, ESS has won a vote of confidence from prestigious and well-heeled backers. SoftBank’s SB Energy and Bill Gates-funded Breakthrough Energy Ventures led the round, which also brought in Evergy Ventures and PTT Global Chemical, in addition to previous investors.

“SB Energy and Breakthrough Energy Ventures both bring teams with deep experience and resources across multiple areas,” said Hugh McDermott, ESS senior VP for business development and sales, in an email. “This will contribute to our company’s growth on several levels, from board level leadership, to joint development, to renewable energy project development.”

ESS will use the funds to enhance its manufacturing facility in Wilsonville, Oregon and to prepare to serve utility-scale projects worldwide.

Since the company closed a $13 million Series B in 2017, it finished a second generation of its flow technology and worked with reinsurance giant Munich Re to craft a bankable warranty for the unusual product.

Its deployments so far have been behind the meter, using the containerized Energy Warehouse product. ESS has contracted 8 megawatt-hours of new Energy Warehouse orders, with the largest single project providing 2 megawatt-hours of storage capacity, McDermott noted.

City skyscrapers could in future be used to house large “green batteries” in their underground foundations, according to a Scottish start-up behind an innovative new form of energy storage.

Gravitricity has developed a method of storing energy which works by raising multiple heavy weights up a deep shaft which can then be released when energy is required. Designed as an alternative to conventional battery storage systems, the technology could help balance the grid during periods of peak demand.

Gravitricity claims its system can operate for decades “without any degradation or reduction in performance”, potentially giving it an edge over some other forms of energy storage.

The 24MWh system – which comprises 24 weights of 500 tonnes – could power 63,000 homes for one hour, with a total weight equivalent to 84 blue whales, the company said.

Green-tech pioneers are preparing to install Gravitricity’s system in disused mineshafts across Europe, the firm said. But it is already looking ahead to the next stage of its deployment and is exploring the possibility of installing the technology in the foundations of new skyscrapers – thereby turning the buildings into city centre green energy storage units.

“In the early years we will install our technology in disused mineshafts as this will help keep the cost down,” said Gravitricity managing director Charlie Blair, as he unveiled the idea yesterday. “But in the future, we will be able to sink purpose-built shafts wherever they are required – and the foundations of city buildings could be ideal.

“New skyscrapers bring substantial new electricity demand, and by building storage in the heart of cities we can massively reduce the requirement for very costly and disruptive grid upgrades. At the same time, our system means that future skyscrapers could reduce their environmental footprint and help cities decarbonise their energy needs.”

Last year, the firm received £650,000 from government-backed R&D agency Innovate UK to help repurpose old mineshafts to pilot the technology. The firm has since teamed up with Dutch winch specialists Huisman to build a 250kW scale prototype of the idea.

The UK already uses gravity-based systems to store energy at a number of pumped hydro projects, which use excess grid power to pump water up hill. The water can then be released again when power is required.

In total, the energy storage market is projected to be worth $620bn globally up to 2040, according to estimates from Bloomberg New Energy Finance.

Australia’s strong and ongoing potential for energy storage paired with solar PV has seen international and domestically-headquartered companies race to gain market share.

China-headquartered global solar inverter supplier Sungrow and domestically-headquartered battery storage company RedEarth Renewables have been among those sending releases and announcements to international press to coincide with the All-Energy Australia trade show taking place last week.

Targeting further residential gains, Sungrow struck a 100MW distribution partnership agreement with Australian distributor Prosun Solar, with the deal apparently signed and confirmed at the show last week.

The inverter company claims to already have more than a 10% share of the Australian residential market and is looking to deliver products that include user-friendly residential hybrid inverters, and all-in solutions that include battery as well as hybrid inverter. This enables “not only maximum yields but also optimum charging and discharging capabilities,” the company, which showed off a range of PV inverters from 2kW for 10kW for household use at the show, claimed.

On top of that, in addition to its range of commercial PV inverters including the 1500Vdc string inverter SG250HX, Sungrow also showcased the ST556kWh-200UD energy storage system (ESS) solution, developed through its joint venture (JV) company, Sungrow-Samsung SDI.

Meanwhile, locally-headquartered company RedEarth Energy Storage said a few days ago that it has attained approval for its product the SunRise Home Battery system, from the country’s national Clean Energy Council.

This makes it the first product on the Council’s approved list of all-in-one battery energy storage system (BESS) inverters to be made by an Australia headquartered company and manufactured within the country. This makes the outdoor-rated plug ‘n’ play battery system eligible for “all government grant and subsidy programmes,” RedEarth said in a release.

The global energy transition is happening faster than the models predicted, according to a report released today by the Rocky Mountain Institute, thanks to massive investments in the advanced-battery technology ecosystem.

Previous and planned investments total $150 billion through 2023, RMI calculates—the equivalent of every person in the world chipping in $20. In the first half of 2019 alone, venture-capital firms contributed $1.4 billion to energy storage technology companies.

“These investments will push both Li-ion and new battery technologies across competitive thresholds for new applications more quickly than anticipated,” according to RMI. “This, in turn, will reduce the costs of decarbonization in key sectors and speed the global energy transition beyond the expectations of mainstream global energy models.”

RMI’s “Breakthrough Batteries” report anticipates “self-reinforcing feedback loops” between public policy, manufacturing, research and development, and economies of scale. Those loops will drive battery performance higher while pushing costs as low as $87/kWh by 2025. (Bloomberg put the current cost at $187/kwh earlier this year.)

“These changes are already contributing to cancellations of planned natural-gas power generation,” states the report. “The need for these new natural-gas plants can be offset through clean-energy portfolios (CEPs) of energy storage, efficiency, renewable energy, and demand response.”

New natural-gas plants risk becoming stranded assets (unable to compete with renewables+storage before they’ve paid off their capital cost), while existing natural-gas plants cease to be competitive as soon as 2021, RMI predicts.

RMI analysts expect lithium-ion to remain the dominant battery technology through 2023, steadily improving in performance, but then they anticipate a suite of advanced battery technologies coming online to cater to specific uses:

Heavier transport will use solid-state batteries such as rechargeable zinc alkaline, Li-metal, and Li- sulfur. The electric grid will adopt low-cost and long-duration batteries such as zinc-based, flow, and high-temperature batteries. And when EVs become ubiquitous—raising the demand for fast charging—high-power batteries will proliferate.

Singapore has targeted 200MW of energy storage beyond 2025 and 2GW of solar by 2030, but will continue to rely on natural gas for the next 50 years, according to a government official.

This morning, minister for Trade and Industry Chan Chun Sing spoke about the country’s energy focus over the next five decades at the opening of the Singapore International Energy Week. The island nation currently obtains 95% of its electricity supply from natural gas delivered through pipelines from neighbouring counties and global supplies of Liquified Natural Gas (LNG) through its ports. While Chun Sing aimed to diversify this gas supply, he also put forward a vision for alternative energy supply.

The goal of 200MW of energy storage beyond 2025 comes under a vision of having a network of energy storage solutions across the entire island to manage the stability and resilience of the grid, as well as offering peak shaving services.

Singapore’s difference between peak and trough within the daily cycle can be as much as 30%, requiring extra infrastructure capacity to meet peak demand. The use of storage to balance peak and trough demand, however, could save on such infrastructure costs.

Chun Sing said: “if we can do that well, I believe that the solutions will not only benefit Singapore but will also benefit many other countries beyond Singapore. Today, in order to cater to peak demand, most countries have to spend a lot to build the infrastructure just for that few hours of the day. So energy storage solutions are something that we would certainly like to develop further, with our partners both in the private sector and in other countries.”

The energy storage vision is partly driven by the expected push for solar energy installations in the coming years. Lacking in geothermal, wind and tidal resources, Singapore’s future clean energy plans rest largely on solar power, despite having overcast skies for roughly 80% of the time due to its tropical climate.

The 2GW of PV by 2030 goal – described by Chun Sing as a “stretch target” – would account for the equivalent of 10% of Singapore’s peak daily electricity demand today. It would require collaboration between the public and private sectors as well as breakthroughs in solar module efficiencies and vertical solar installations, given that Singapore lacks available land and relies heavily on rooftop-based solar deployment.