This past week, I attended the Midwest Energy Forum at the University of Chicago. The Forum focused on the future of the U.S. electricity grid and the technologies that are likely to transform it over the next 30 years. Experts in many of these technologies, including energy storage, wind, solar, nuclear, gas, and high voltage DC transmission systems, made presentations.
Of all the technologies discussed, however, I came away with the impression (which I suspect was shared by many) that energy storage was the poor step child of the renewables industry. Although the representatives of the wind, solar and other renewables industries were polite and nominally supportive of storage, they were consistent in their message that storage has a long way to go and that it was certainly nowhere near as important as the renewable energy technologies they were advocating.
In fairness, the storage experts did not do much to rebut this perception. While several experts gave good presentations about what storage could do on the grid, none explained with anything near the coherence of the wind, solar and transmission proponents why what storage could do was important and why the public or the government should care about it.
It is, of course, critically important that the energy storage industry make its case for support to the government and to the public in a way that is honest, rational and persuasive. Our colleagues in the wind and solar industries have done a great job of doing that. At least in terms of public relations and dialogue, I would agree with them that storage has a long way to go.
So let me give it a try: Storage is important for the same reason that wind and solar energy are important but only more so–and only assuming that the true value of wind and solar energy technology is properly understood.
While it is true that wind and solar are relatively clean forms of energy, cleanliness in itself is not their principal value to the grid. Some experts argue that because of the cycling of thermal energy plants that generally must take place in order to balance the variable nature of wind and solar power, the overall environmental benefits of wind and solar are overstated. Whether or not that is true, it is certainly true that the relative environmental benefits of wind and solar energy depend on the nature of the fuels they replace. Where that fuel is relatively clean natural gas (which appears will be the case in the United States for the foreseeable future), it is difficult to argue that the low relative environmental benefits of wind and solar over natural gas justify the billions of dollars of subsidies that the wind and solar industries have received.
But wind and solar energy are, in fact, of great value to the electricity grid. Their value, however, derives not just from the fact that they are relatively clean but from the fact that they each represent a useful new power resource that permits us to operate the grid more flexibly. Society can use this new flexibility to change the way that electricity is generated and used across the system so as to pursue whatever goals society wants to achieve.
A good example of this is what is happening in Germany. Following the Fukushima accident, Germany decided to abandon nuclear power completely within 11 years. This is no minor ambition, given that in 2010 about 22.4% of all electricity in Germany came from nuclear power. One may agree or disagree with Germany’s plans to transition away from nuclear power. But what is beyond question is that Germany could never hope to effect such a transition, let alone to have a rational discussion about doing so, but for the resources and flexibility that wind and solar power (and perhaps storage) now provide.
The fact that wind and solar energy have become useful resources for grid operators—whether to move away from nuclear energy, or move towards cleaner fuels, or to emphasize distributed generation, or to achieve whatever other goals society might want to achieve with its electric power system– is solely a consequence of the investments that have been made in wind and solar technologies over the past ten years. Ten years ago, both wind and solar energy were not far beyond the stuff of tie dye t-shirts and Hollywood playthings. No knowledgeable person would have supposed that wind or solar energy could be a major source of generation on the electricity grid. Costs were too high, reliability was suspect, and capacities and efficiencies were far too low to be of any practical use on the grid.
What a difference ten years and a few billion dollars of subsidies makes. The cost of wind and solar energy technologies has plummeted. Reliability and utility have been proven by hundreds of projects around the world. Even capacity factors, the alleged Achilles Heel of renewable energy, have risen dramatically. As a wind developer at the Midwest Energy Forum put it: “If my project has a capacity factor of more than 50%, does it still count as variable energy?”
And that brings us back to energy storage. For however much flexibility wind and solar technology may offer to grid operators, energy storage technology offers more. The ability to move electrons over time as well as over space opens a world of opportunities as to how that ability can be used and how the grid can be designed. Storage can be used to alter the balance of generation technologies, favoring those that are cleaner or otherwise deemed more favorable over those that are not. Storage can reduce the need for physical grid infrastructure, promoting energy efficiency, reducing O&M costs and improving viewscapes. Energy storage can reduce the cycling of thermal plant, provide greater power security, enable distributed generation, allow the development of microgrids, and facilitate a wide variety of other possibilities on the grid, the benefits of which may be difficult fully to understand today. After all, who in 2010 would have predicted that in 2011 a top priority of Germany’s energy policy would be eliminating nuclear power?
If the highest objective of new energy technology is to provide greater flexibility to manage the electricity grid in ways that society deems most beneficial, then no technology—not wind, not solar, not biomass, not new transmission technology—is more important to develop than energy storage technology. Energy storage is not just about making the grid cleaner (though it can be). It is about making the grid more robust and more flexible so that policy makers, now and in the future, can shape the grid to the requirements of society as those requirements change over time. No new energy technology can do that as well as energy storage.