Results announced last week in a Capacity Market (CM) auction in France which had low-emissions requirements, saw 253MW of energy storage awarded 7-year contracts, along with 124MW of demand response capacity.

The European country holds CM auctions which ensure electrical capacity is available guarantee the lights stay on event at times of peak demand or during unexpected stress events that could otherwise cause blackouts. In the latest auction, the electricity transmission network operator (RTE), awarded 377MW of contracts.

Corentin Baschet, a markets analyst at consultancy firm Clean Horizon, told Energy-Storage.news that the latest auction was “only for new build capacity and had emissions requirements enabling only demand side response (DSR) and energy storage to participate”. Emissions were fixed at 200g of CO2 per kWh or less.

Baschet said that the four auctions run since June 2019 are roughly equivalent to Britain’s T-1, T-2, T-3 and T-4 auctions in its own Capacity Market. However, as frequently reported on this site, regulatory and market design issues have effectively locked batteries out from competing in latter auctions in the UK, leading to two asset operators instead registering their battery systems as demand side response – and winning contracts.

Although France’s market rules had no such stipulations, Baschet said, only two of those four French auctions awarded capacity contracts (for the periods between 2021-2027 and between 2022-2028) as market caps were already reached in periods 2020-2026 and 2023-2029. The Clean Horizon analyst noted that the contracts were awarded prices of €29k per MW/year (2021 period) and €28k per MW/year (2022 period).

“These contracts use the same principle as Contracts for Difference (CFDs), capacity has to bid in the yearly capacity market auctions – clearing at an average of €20k/MW/year today,” Corentin Baschet of Clean Horizon said, adding also that some big players in the French market such as EDF and NW Energy were absent due to their having large storage deployment plans already announced separately.

A California county has given the green light to what officials say will be part of the largest renewable energy storage facility in the world.

The project, which is a partnership between Tesla and Pacific Gas & Electric (PG&E) won unanimous approval from the Monterey County Planning Commission Wednesday, NBC Bay Area reported. It is the second clean energy battery facility to be approved at the site of an underused power plant in Moss Landing.

“Certainly, combined, this is going to be the largest battery facility in the world, so it’s a big boost to our community and our country,” Monterey County Supervisor John Phillips said, as CleanTechnica reported.

The Tesla/ PG&E facility will have the capacity to store up to 730 megawatts of wind and solar power during off-peak hours, the Monterey Herald reported. The other project recently approved on the site, which is being built by Vistra Energy, will have a capacity of 1,200 megawatts.

The most recent project will involve the installation of 268 Tesla Megapack lithium-ion batteries.

The Megapack is a relatively new Tesla design, following the Powerpack batteries it used at its storage facility in Hornsdale, South Australia, which is the largest lithium ion battery in the world.

Tesla explained how they work:

Megapack significantly reduces the complexity of large-scale battery storage and provides an easy installation and connection process. Each Megapack comes from the factory fully-assembled with up to 3 megawatt hours (MWhs) of storage and 1.5 MW of inverter capacity, building on Powerpack’s engineering with an AC interface and 60% increase in energy density to achieve significant cost and time savings compared to other battery systems and traditional fossil fuel power plants. Using Megapack, Tesla can deploy an emissions-free 250 MW, 1 GWh power plant in less than three months on a three-acre footprint – four times faster than a traditional fossil fuel power plant of that size. Megapack can also be DC-connected directly to solar, creating seamless renewable energy plants.
The Megapack also replaces the need for “peaker” natural gas power plants, Tesla explained. These are power plants that fire up whenever the local grid can’t meet demand.

“They cost millions of dollars per day to operate and are some of the least efficient and dirtiest plants on the grid,” Tesla wrote.

Construction on the company’s Moss Landing project will begin at the end of the month and should be completed by the end of 2020, NBC Bay Area reported.

The global energy storage market is expected to grow to $546 billion (£424bn) in annual revenue by 2035, according to a report released by Lux Research.

The report estimates battery deployment across mobility applications, electronic devices and stationary storage will reach an annual level of 3,046GWh during the next 15 years, up from the current 164GWh.

It is expected plug-in light-duty vehicles will remain the largest market with a predicted $24 billion (£18.6bn) increase in revenue by the end of 2022 with medium- and heavy-duty vehicles following, growing from $600 million (£466m) a year in 2019 to a projected $3.6 billion (£2.7bn) per year in 2022.

Mobility applications will continue to drive the growth for energy storage through 2035 with personal mobility devices expected to increase to $43.7 billion (£33.9bn) from their current $2 billion (£1.5bn) in revenue.

Meanwhile, energy storage demand for electronic device applications is expected to remain the same as the markets for laptops, cell phones and tablets are already saturated.

Chloe Holzinger, one of the report’s lead authors, said: “The energy storage industry is poised for a massive increase as key innovative technologies, such as solid-state batteries and flow batteries, reach commercialisation.

“We expect electric mobility applications to be the principal driver of energy storage annual revenue and demand, with a total market share of 74% by annual revenue and 91% by annual deployed GWh by the year 2035.”

esVolta, a developer of utility-scale battery energy storage projects, recently closed a $140 million senior secured credit facility to finance a 136 MW/480 MWh portfolio of eight storage projects in California.

It’s this type of institutional investing that’s going to drive the massive growth expected from the energy storage industry.

It’s not the next lithium-ion battery breakthrough that’s going to accelerate the energy storage industry. It’s not the next inflated promise from a flow battery startup, compressed-air scheme, solid-state battery research project or energy storage dream funded by Bill Gates.

It’s energy storage projects as investment-grade finance tools for institutional investors that will grow the energy storage market to $546 billion in annual revenue by 2035, as predicted by Lux Research or grow the business tenfold from 2018 to 2023, rising to $5 billion annually, according to Wood Mackenzie.

One of the largest debt transactions in the energy storage market

CIT’s power and energy business led the financing round, along with Siemens Financial Services (SFS), CoBank, ACB, and KeyBanc Capital Markets.

These investor names can typically be found financing natural gas power plants and wind projects — so this entry into energy storage is a bit of a watershed moment.

Krish Koomar, CFO of esVolta said it was “one of the largest and most innovative debt transactions” in energy storage.

There was a wave of finance directed at energy storage a few years ago — more in the behind-the-meter realm than these projects. Stem, a provider of commercial energy-storage systems, added $100 million in financing from energy investor Starwood Energy Group, Generate and Clean Feet Investors. Mainstream infrastructure investor Macquarie Group planned to put $200 million into a fleet of battery projects from Advanced Microgrid Solutions.

Since then, Stem and AMS have had to retrench and alter their business plans. Stem has recently signaled that it is up for sale.

US utility company Dominion Energy has received approval for the building of four large-scale battery storage plants totalling 16MW of output in the Commonwealth of Virginia.

Virginia is undergoing a clean energy transformation and while some reports had pegged Dominion, a major utility player in the region as a reluctant participant in that movement, others have stated that the utility has not only accepted but moved proactivelly to embrace the transition once in motion and in law.

Dominion Energy Virginia this week received approval from the State Corporation Commission to go ahead with the battery storage projects, which the company said will help it understand the role energy storage can play on its networks.

While the more recent Virginia Clean Economy Act is only just getting started, Dominion said the pilot projects, investigating batteries and their role in smoothing out the intermittency of, and integrating, wind and solar energy, was enabled by Virginia’s earlier 2018 Grid Transformation and Security Act, which corporate trade body Advance Energy Economy neatly summarised in May 2019 on its own blog.

The four battery systems will provide three different use cases: Two, adding up to 12MW between them, will be used to store solar energy, from the 17MW Scott Solar farm in Powahatan County. These two facilities will store surplus PV-generated power in times of high “production and release energy during periods when load is high or solar generation is low”, Dominion said in a release, while they will also assess the effectiveness of battery storage in optimising solar PV plant operation.

The other two projects will be 2MW each. One will assist the grid at a substation to assess whether, as in other parts of the world, storage can mitigate the need for expensive network upgrades to meet local demand patterns, while the other will be deployed at a 20MW solar farm to assess the efficacy of batteries in managing reverse power flows, which can impact local network voltage and loading issues.

The four facilities are expected to cost around US$33 million in total and are expected to be operational by the end of the first quarter of 2021, from when they will be assessed for a period of five years.

The American Energy Innovation Act (AEIA) will modernize domestic energy laws to ensure the United States remains a global energy leader while also strengthening national security, increasing our international competitiveness and investing in clean energy technologies.

Solar power is mentioned in Section 1205, where the bill authorizes the Secretary to establish a solar energy technology program to address near-term, mid-term and long-term challenges in solar energy development through 2025. Section 1301 on battery storage is more robust, saying the bill would establish a research, development and deployment (RD&D) program to advance energy storage technologies; directs the Secretary to carry out at least five demonstration projects, as well as a competitive pilot project grant program; establishes a joint long-term demonstration initiative with the Secretary of Defense; facilitates a technical and planning assistance program for rural electric cooperatives and municipal utilities; establishes an energy storage materials recycling prize competition; and directs the Federal Energy Regulatory Commission (FERC) to issue a regulation on energy storage cost recovery.

“This bill is our best chance to modernize our nation’s energy policies in more than 12 years,” Murkowski said. “By working together to pass it into law, we can promote a range of emerging technologies that will help keep energy affordable even as it becomes cleaner and cleaner. Our bill also addresses national needs by taking overdue steps to enhance our cybersecurity, grid security, and mineral security. I’m proud of the bipartisan work we have done and encourage all members of the Senate to work with us to advance it through the legislative process.”

“This legislation is the result of strong bipartisan work with my colleagues on the Senate Energy and Natural Resources Committee to make a down payment on emissions-reducing technologies, reassert the United States’ leadership role in global markets, enhance our grid security and protect consumers. Importantly, this bill will connect energy-producing communities, including in states like West Virginia and Alaska, to new markets and job opportunities while laying the groundwork for the Department of Energy to advance new and necessary critical emissions-reducing technologies,” Manchin said.

The key provisions in the AEIA focus on energy efficiency; renewable energy; energy storage; carbon capture, utilization, and storage; advanced nuclear; industrial and vehicle technologies; the Department of Energy; mineral security, cyber and grid security and modernization; and workforce development.

The solar-plus-storage market is evolving rapidly and will look completely different a decade down the road. What can we expect on the way to 2030? Here are 10 predictions.

All-in-one systems will be the new normal

1. Lots of storage

Batteries will be incentivized or mandated for practically every new solar PV system across the U.S. by 2025. As more homeowners and businesses deploy PV systems to reduce their electricity bills and ensure backup power, simple net metering will increasingly be replaced by time-of-use rates and other billing mechanisms that aim to align power prices with utility costs. We already see these trends in California and several states in the Northeast.

1. System costs will increase with the shift toward batteries

Solar systems with batteries are going to be about twice as expensive as traditional grid-direct installations, so in that sense, we will see actual costs increase as the mix shifts toward batteries. But while system costs will go up, we need to be careful to parse the actual equipment and soft costs from the consumer’s cost net of tax credits and incentives. Equipment costs for batteries and other hardware are generally flat to slightly down.

2. More battery and inverter packages from the same brand

Since the battery represents the dominant cost in an energy storage system (ESS), inverter companies will increasingly offer branded batteries. In turn, inverter companies packaging third-party batteries will eventually make way for savvy battery companies that can package the whole system.

3. Energy storage systems treated like heat pumps and air conditioners

California’s new Title 21 requirements make solar PV systems standard issue, and we can expect a future update to do the same for energy storage. By then, builders will be able to choose the ESS line they want to work with, and the whole process will look almost exactly like it does for home mechanical appliances like water heaters and HVAC systems. The only question will be whether the ESS is packaged with solar panels or kept separate.

Energy company Dominion Energy Virginia has secured approval from Virginia’s State Corporation Commission (SCC) for the construction of four battery storage pilot projects in the US.

The approval will pave the way for additional energy storage technology, required to support the company’s commitment to achieving net-zero carbon and methane emissions by 2050.

The four central Virginia-based projects totalling 16MW will cost approximately $33m to construct and will provide key information on distinct use cases for batteries on the energy grid.

Once operational in the first quarter of next year, the company will evaluate them for a period of five years.

Dominion Energy generation construction vice-president Mark Mitchell said: “Dominion Energy will pilot these 16MW of battery storage to better understand how best to deploy batteries across our system to integrate renewables and provide grid reliability by filling gaps due to the inherent intermittency of solar and wind power.

“These pilot projects will also help us learn how to incorporate this emerging technology into our overall strategy to achieve net-zero carbon dioxide and methane emissions.”

Said to be the largest projects of their kind in Virginia, the utility-scale battery storage pilot projects are enabled by the Grid Transformation & Security Act of 2018 that allows Dominion Energy to invest in battery projects with up to 30MW capacity.

The science of renewable energy is remarkable—the ability to harness nature to magically power our modern world is a seductive vision. And yet, the actual business of renewable energy is late to establish itself as a viable competitor to the petrochemical industry. The problem is rooted in cost parity and the challenges of production, storage, and disposal (Figure 1). To use the industry’s fancier and totally sensible term, it’s the math of levelized cost of energy (LCOE) that we can’t figure out.

LCOE measures the average cost of electricity generation for any power plant—coal, hydro, solar, or thermal—over its lifetime. And it turns out that by the time you harvest the Earth’s minerals to produce, ship, deploy, and maintain a renewable energy plant, it is more expensive to generate power versus burning coal. And that’s too bad because we’re all paying the price.

According to BP’s 2019 Statistical Review of World Energy, annual carbon emissions grew by 2.0%, with China and the U.S. as the largest contributors, and coal took the largest share of all power generation at 38%. No matter where you stand in the debate on climate change, let’s just agree that pollution is bad and coal means a lot of it.

What about renewables? It’s mostly good news, but it’s slow-moving. According to Global Data’s Renewable Energy—Thematic Research, renewable energy will reach a 22.5% share in the global power mix by 2020, up from 18.2% in 2017. Hydro and nuclear grew by 14.5%, and solar generation grew more than 40%. By country, China was the largest contributor to renewables growth, surpassing the entire developed world. Hydroelectric generation increased by an above-average 3.1%, and nuclear generation rose by 2.4%.

Energy Storage Is Key to Success
It gets even more interesting when you take a closer look at the problem on a systemic level. For the most part, you can’t store renewable energy. Lithium-ion batteries or water reservoirs end up costing more than the power that they store. It is arguable that as long as the renewable energy storage dilemma is not solved, we’re never going to get to a 100% renewables-powered world.

Energy storage is insanely expensive. Lithium-ion batteries are seen as the main renewable energy storage technology, but they are even more costly to produce, procure, maintain, and dispose of than burning fossil fuels. When consumers store electricity in a lithium-ion battery in their home, they generally pay at least $0.30/kWh, while neighbors pay a bargain price of $0.10/kWh for coal-generated power.

Creating lithium-ion batteries requires five raw materials—lithium, nickel, manganese, cobalt, and graphite—the sourcing of which entails massive ecological and humanitarian problems, such as toxic black holes and die-off of wildlife, in some of the most beautiful parts of the world, including the Bolivian Andes, Argentina, and Chile. I choose flamingos over batteries (Figure 2).

Pivot Power is developing a world-first national network of grid-scale batteries and high-volume power connections to provide essential capacity for rapid electric vehicle (EV) charging.

The first two projects at Cowley in Oxford and Kemsley in Kent are expected to be fully operational before the end of this year.

Wärtsilä will support the projects under 10-year service agreements with flexible performance guarantees. The order was booked with Wärtsilä in December 2019.

The two 50 MW lithium-ion batteries will be the first projects completed as part of Pivot Power’s programme to develop, own and operate up to 2 GW of grid-scale energy storage and high volume power connections, which are directly connected to the UK high-voltage transmission system.

The projects will provide flexible capacity and reliability to support increased renewable energy generation and EV charging infrastructure. The UK market for EVs is expected to expand significantly in 2020 in what has been described as “the year of the electric car” by industry analysts.

This is the largest energy storage deal in Europe for Wärtsilä, which has set its sights on the UK as a key new market.

Adrien Lebrun, Pivot Power’s engineering director said: “At Pivot Power we are committed to enabling a clean electric future and accelerating the expansion of electric vehicles across the UK, and as part of EDF Renewables we are making this vision a reality.

“These Wärtsilä energy storage systems allow us to harness cutting-edge technology to future-proof our investments in a changing energy market, supporting our long-term goal to reduce the UK’s carbon footprint and bring us closer to net zero.”