The global annual energy storage market is at risk of contracting in 2019, following a bumper year of growth in 2018, according to new research by Wood Mackenzie.

The report – ‘Global energy storage outlook, Q3 2019’ – said the global market has slowed down in key regions that saw 2018’s boom, namely South Korea and China.

These countries have been plagued with fire incidences, as well as policy and regulatory changes, Wood Mackenzie said.

The US and European markets are also struggling to get capacity on the ground in 2019, with capacity being pushed to 2020, 2021 and, in some cases, even further out, it said.

However, beyond 2019, the global storage outlook is on the up.

Wood Mackenzie expects 4GW of energy storage to be deployed globally in 2019, with these numbers increasing to 15GW in 2024.

Wood Mackenzie senior analyst Rory McCarthy said: “The energy storage industry in the Asia-Pacific region is still at an early stage of development.

“China’s storage market slowed in the first three quarters of 2019, primarily due to policy change.

“South Korea’s storage market continues to stagnate due to continuous fire incidents. However, Australia’s storage market is on track to hit targets in 2019 and is expected to grow three-fold in 2020.

“The rest of the Asia-Pacific market is beginning to pick up.

“In the US market, hidden beyond the overall surge in forecasted five-year deployments is an industry hitting growing pains, as the reality of supply chain constraints, regulatory hurdles and performance and safety concerns are set to push back some 2019 and 2020 projects.

“The market is expected to bounce back quickly from this near-term slowdown by accelerating in 2021, driven by large-scale utility procurements targeting GWs of storage – often paired with renewables – over the next three to five years.

“We are at a crossroads in the UK and Germany. Frequency markets have saturated. Now players are looking for other opportunities.

ENERGY Exploration Technologies (EnergyX) has developed a scalable lithium extraction process using metal organic framework (MOF) membranes to extract lithium from brines, which is a faster, more efficient, and more environmentally friendly method than conventional processes.

The technology is known as Lithium Ion Transport and Separation (LiTAS) and is the result of research from the University of Texas at Austin, Monash University, and the Commonwealth Scientific and Industrial Research Organisation (CSIRO) in Australia. EnergyX has secured the rights to the technology and is commercialising it.

LiTAS uses mixed matrix membranes (MMM), which are an interconnected network of MOFs held together by polymers. MOFs have large internal surface areas and small pore sizes, which makes them suitable for separation, and polymers have robust mechanical properties. The MMM is made into a thin film using a proprietary casting method created by Kevin Reimund, the Director of Membrane Engineering at EnergyX. The film is then rolled into a module and then thousands of modules can be linked together to create a scaled-up version at a lithium extraction facility.

Disruptive technology

Typically, lithium is produced from brine evaporation or hard rock mining. Producing lithium from brine evaporation takes an average of 18 months but can take up to 24 months. It also uses a significant amount of freshwater, requiring around 2,270 L/t of lithium produced. In contrast, EnergyX’s technology is a continuous process that takes one to two days and it doesn’t require any fresh water. The MOF also ensures that the lithium is separated from all other salts in the brine. LiTAS has a low power consumption, reduced operating costs, and has a lithium recovery rate of 90% compared to 30–50% from conventional processes,

According to Teague Egan, founder and CEO of EnergyX, the technology will be extremely disruptive to the industry. “It is an absolutely transformative step-change in the way lithium is sourced today. Traditional lithium mining is done through either hard rock or brine evaporation. We are looking to replace the brine evaporation side, which will drastically undercut the economics of hard rock mining as well. We are confident our new method will completely replace traditional mining. It’s a horse vs car comparison.”

Senate legislators, energy investors and utilities are looking to the next generation of energy storage to achieve “deep decarbonization,” but few researchers are confident that today’s experimental technologies will ensure wind and solar become the dominant sources of power.

Over the past decade, power companies have cultivated a taste for lithium-ion storage, stringing together battery packs into a giant sponge that soaks up electricity and later delivers it for four- to eight-hour increments.

Markets for that kind of short-term battery storage are modest, but they’ve grown eighteenfold since 2009, according to a count by Environment America, a green advocacy group.

Some believe that with sufficient resources, scientists and entrepreneurs could pioneer a kind of storage that multiplies the current four-to-eight-hour period of power delivery several times over. States, cities and companies have put out a flood of 100% renewable or zero-emission plans, which count on development of technology that can store electricity for days or weeks.

“There’s a sense that this is coming,” said Scott Litzelman, a program director at the Advanced Research Projects Agency-Energy (ARPA-E).

Yet energy storage could hit a wall if power companies aren’t already moving to replace most nonrenewable generation with wind and solar. Few energy analysts say they believe long-term storage would serve the same purpose as nuclear, gas or coal plants that produce a constant stream of “baseload” power.

On a highly renewable grid, power companies would still have to encourage consumers to use less power at certain hours. And expanding transmission connections between regions could, in some cases, improve reliability in ways similar to storage, they say.

Tim Grejtak, an analyst at the New York-based market research firm Lux Research Inc., noted in a presentation last year that the applications for long-duration systems were so far “vaguely defined.”

Early deployments might take place on island grids or remote areas, he predicted. But “in our minds, it’s sort of a solution of last resort. And as such, we don’t think it will see a huge deployment, in terms of pure numbers of projects.”

Tesla CEO Elon Musk forecast that the company’s energy business will eventually be the same size as — or even bigger than — its automotive sector, the latest sign that the company plans to put more time and resources to scaling up its solar and storage products.

“It could be bigger, but it will certainly be of a similar magnitude,” Musk said during an earnings call Wednesday. The company surprised Wall Street by reporting a return to profitability in the third quarter.

The bulk of Tesla’s revenue is generated from sales of its Model S, Model X and Model 3 electric vehicles. In the third quarter, automotive revenues were $5.35 billion. The company doesn’t break out revenue generated from solar, energy storage or other products and services. However, the total revenue in the third quarter was $6.3 billion, which gives some indication of the size of automotive compared to its other businesses.

Tesla’s energy and solar businesses languished for nearly two years as attention and resources were directed to the Model 3. That diversion of resources included redirecting to the car battery cell production lines meant for its home Powerwall and commercial Powerpack energy storage products because the company didn’t have enough cells.

“We had to do it because if we didn’t solve the Model 3, Tesla wouldn’t survived,” he said. “So, unfortunately that shorted other parts of the company.”

Now, the company is committed to scaling up energy storage and solar. Kunal Girotra, who initially joined Tesla in 2015 as a senior product manager for Powerwall, was promoted to senior director of the company’s energy operations.

In the third quarter, Tesla deployed 43 megawatts of solar, a 48% increase from the previous quarter. Solar installations are still 54% lower than the same period last year.

Highview Power, a provider of long-duration energy storage solutions, announced plans to construct the UK’s first commercial cryogenic energy storage facility (also referred to as liquid air) at large scale, which will be located at a decommissioned thermal power station in North of England. The 50 MW/250 MWh project is a clean large-scale energy storage facility that can help the UK achieve its goal of decarbonizing industry, power, heat and transport. The project being developed was announced by Highview Power CEO Javier Cavada during remarks at the BloombergNEF summit in London.

Along with this first large-scale facility, Highview Power is developing a portfolio of projects in the UK and is in the process of securing sites. These projects will further the UK’s strong move towards its clean energy goals and help it meet the expected global demand for energy storage.

“We are excited to begin working on our first commercial UK project at scale to become the largest battery storage system in Europe and support the national grid. This CRYOBattery plant will provide the critical services needed to help maintain a stable and reliable grid,” said Cavada. “Long-duration, giga-scale energy storage is the necessary foundation to enable baseload renewable energy and will be key to a 100% carbon-free future.”

Highview Power, a provider of long-duration energy storage solutions, announced plans to construct the UK’s first commercial cryogenic energy storage facility (also referred to as liquid air) at large scale, which will be located at a decommissioned thermal power station in North of England. The 50 MW/250 MWh project is a clean large-scale energy storage facility that can help the UK achieve its goal of decarbonizing industry, power, heat and transport. The project being developed was announced by Highview Power CEO Javier Cavada during remarks at the BloombergNEF summit in London.

Along with this first large-scale facility, Highview Power is developing a portfolio of projects in the UK and is in the process of securing sites. These projects will further the UK’s strong move towards its clean energy goals and help it meet the expected global demand for energy storage.

“We are excited to begin working on our first commercial UK project at scale to become the largest battery storage system in Europe and support the national grid. This CRYOBattery plant will provide the critical services needed to help maintain a stable and reliable grid,” said Cavada. “Long-duration, giga-scale energy storage is the necessary foundation to enable baseload renewable energy and will be key to a 100% carbon-free future.”

In addition to supplying energy storage, Highview Power’s facility will also provide valuable services to the national grid to help integrate renewables, stabilize the electrical grid and ensure future energy security. Other services the facility could deliver include market arbitrage, frequency management, reserve and grid constraint management services. Highview Power is currently in discussions with potential offtakers to contract for the capabilities and services the facility can provide.

Energy storage installations around the world will multiply exponentially, reaching 1,095GW/2,850GWh by 2040. Over the next two decades, $662 billion of investment will be needed for stationary energy storage, according to BNEF.

Highview Power’s CRYOBattery uses only benign materials with zero emissions and has zero water impact. The new facility in the North of England is the first large scale commercial system utilizing this technology, pioneered at Highview Power’s pilot plant in Slough, and evolved at the demonstration plant in Pilsworth, Greater Manchester, which has been successfully operating since early 2018.

“No other policy in play right now” could be “more immediate or more impactful” than a ‘standalone’ Investment Tax Credit (ITC) in the US for energy storage, the CEO of the national Energy Storage Association has said.

Energy-Storage.news spoke with Kelly Speakes-Backman, head of the ESA, for a wide-ranging feature interview. Speakes-Backman said that energy storage right now is enjoying “extremely strong, bipartisan support, from Congress, from our Department of Energy and other administrations such as the Department of Commerce and Environment Protection Agency (EPA).”

One of the reasons why storage is enjoying cross-party support in what appear to be divided times, is that there is growing recognition of the role batteries and other storage can play in creating an efficient, affordable and sustainable grid, the ESA CEO said. Congress will debate the matter this month.

“Energy storage is there to integrate intermittent resources like solar and wind and help enable our grid to get cleaner – of course – but it’s also there for grid operators to improve the efficiency of the grid, to add more resilience.”

At the moment, energy storage projects are eligible for the solar ITC – itself the subject of strong stakeholder advocacy and lobbying at the moment – but only if installed simultaneously and co-located with the solar power generation.

ESA CEO Kelly Speakes-Backman referred to analysis firm Wood Mackenzie Power & Renewables latest quarterly US Energy Storage Monitor report, which highlighted that a storage ITC could boost forecasted installation figures by 2024 by 300MW each year (from 4.8GW to 5.1GW of predicted deployments).

“Frankly, it made sense at the very beginning to have these, the solar-plus-storage [ITC eligible projects]. But storage is applicable to so much more than just being coupled with solar now, that I think it’s important to create a level playing field. The same for solar, the same for CHP, geothermal, fuel cells, all the other technologies that enjoy independent, standalone ITCs, storage is at a point where it’s important that it be counted as a standalone asset,” Kelly Speakes-Backman said.

Chinese battery manufacturer Contemporary Amperex Technology Co. Limited (CATL) began building its first battery factory outside China in Erfurt, a city in the German state of Thuringia. “Germany is home to a strong automotive industry and several of CATL’s key customers,” said Matthias Zentgraf, head of Europe CATL in a press release. “We believe that the combination of Germany’s industrial tradition and CATL’s tradition of innovative battery technology will greatly accelerate the electrification of the automotive industry in Europe.”

CATL has been chosen as a battery supplier by BMW, Volkswagen, Daimler, Volvo, and Bosch. One of the factors that makes Erfurt an attractive place for a battery factory is that it is within four hours of several several electric car manufacturing facilities, especially the one in Zwickau where Volkswagen will start making its ID.3 electric sedan shortly.

CATL originally expected to invest about €240 million in the new factory but has now raised that number to €1.8 billion. The factory, which is expected to begin production in 2022, will have an initial capacity of 14 GWh a year with expansion to 24 GWh planned in the years to follow. It will employ 2,000 workers when completed, according to Electrive. In exchange for incentives from the government of Thuringia, CATL has also promised to invest in local research and development programs.

While it waits for the new factory to be completed, CATL will begin manufacturing batteries at the site of the former Solar World Industries plant beginning next year. The existing facility is close to where the new factory is being built.

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