The World's #1 Renewable Energy Network for News, Information, and Companies.

Ski Lifts Help Open $25 Billion Market for Storing Power

Ski Lifts Help Open $25 Billion Market for Storing Power

Technology developers are shuttling between caves and mountaintops to build a market for utilities set to attract $25 billion in annual investment within a decade.

To store surplus electricity from power plants, they’re trying to squeeze air into salt mines and run empty trains up hills, testing how to harness the energy released when the air bursts out and the cars roll back down. Trials are under way at companies from Germany’s Siemens AG and RWE AG to General Electric Co. and a startup backed by billionaire Bill Gates, which is experimenting with the momentum of ski lifts.

“Electricity is the only commodity in the world that isn’t really stored,” said Prescott Logan, who heads GE’s storage business in Schenectady, New York, where last month it opened a $100 million plant to make batteries for utilities. When storage becomes cheap and massive, “the impact will be huge.”

The $260 billion renewables industry needs storage so power companies can absorb surges from solar and wind farms from Texas to Mongolia. The devices will be key for plans by Germany to shift Europe’s biggest electricity market from atomic energy, said Gil Forer, Ernst & Young LLP’s clean-tech head in New York.

The consulting firm said annual investment in storage is currently about $2.6 billion, based on data from Pike Research. That’s set to grow to $9.2 billion in 2015 and then to $25 billion by 2021. Logan said Fairfield, Connecticut-based GE expects energy storage to generate $500 million to $1 billion in annual revenue by 2020.

Brad Roberts, executive director of the Electricity Storage Association in Washington, said the business in the U.S. alone may grow to $5 billion within five years.

Water Uphill

While pumping water up a hill has aided in power generation for more than 100 years, the technology is limited to mountainous terrain. Environmentalists have criticized those sites for being harmful to local wildlife, prompting developers to look for alternatives that can be used anywhere anytime.

“Energy storage solutions will catalyze growth in the market for renewable energy by enabling its use in greater volumes and in new applications,” Forer said.

Clean-energy investment rose 5 percent to a record $260 billion in 2011, Bloomberg New Energy Finance data show. China could use storage more than most, with faster-than-average growth of renewables and populations barely served by the power grid. Nations from the U.S. to South Korea are holding tests.

$25 Billion Estimate

Almost half of the 150 gigawatts that currently can be stored is in the Asia-Pacific region, according to Ernst & Young, citing Pike Research, with most of the rest in North America and Western Europe. Reaching $25 billion of investment requires boosting demand, especially with clean energy, which depends more on weather than coal or gas, said Keith Harrison, the firm’s lead analyst for global power and utilities.

“The mandated growth of renewable generation in place of fossil-fueled generation will drive the growth of battery based storage,” he said. Pumped water accounts for about 99 percent of the market, and Roberts from the ESA said he expects this to decrease to below 80 percent within 10 years.

Even the biggest power generators, from coal plants to nuclear, run most efficiently at a steady rate and take advantage of storage during off-peak hours.

Compressed-air energy storage is the most suitable for the biggest plants, Harrison said. Batteries, such as those being developed by GE and Siemens, aren’t yet capable of holding large amounts of power cheaply.

Compressed Air

There are only two working compressed-air facilities today, in Germany and the U.S. Essen-based RWE is developing its own technology and hopes to build a demonstration project in central Germany in 2016. In times of excess power and low demand, such as when the wind blows at night, RWE’s system squeezes air into underground caverns. When this air is released, it drives a generator via a turbine above ground, to produce electricity.

“Pumped-hydro is our preferred large-scale energy storage technology, but in Germany we have only a limited number of sites left for additional large pumped-hydro,” said Peter Moser, head of new technology for power plants at RWE. “Nobody can say that there is a clear winning technology for the future.”

Some companies are pushing things uphill besides water to tap gravity for making power.

Gravel, Ski Lifts, Trains

Bill Gates-backed Energy Cache is shoveling gravel up and down a slope on ski lifts. Gravity Power LLC is pushing water in and out of underground caves. Advanced Rail Energy Storage LLC, headed by James Kelly, the former vice president of transmission and distribution for Southern California Edison Co., sends electric trains between high and low rail yards.

For smaller applications, companies including GE and Siemens are developing batteries. Lithium-ion batteries, such as those produced by Siemens, are receiving the most attention, according to Roberts. Siemens technology already is being tested by Enel SpA, Italy’s biggest utility, as a means of storing energy from its solar farms.

“The smaller lithium-ion batteries are produced in tens and hundreds of millions per year,” said John Newman, associate partner at McKinsey & Co. “The experience you get building those can be translated to building larger and larger battery packs, so I think we’re looking more at the scaling effect.”

GE is working on a sodium nickel battery, the Durathon, since acquiring in 2007 the U.K. business that had been working on the technology since the 1980s, Logan said.

“When you have the ability to store energy, it allows you to better manage the infrastructure that you use to move electricity around the world,” Logan said.

California Project

Advanced Rail, or ARES, is working a small-scale demonstration facility in Nevada that’s due to start in about nine months, and a commercial-scale project in California that may eventually accommodate as much as 300 megawatts of energy. Its Nevada project will probably cost as much as $50 million.

The Nevada project will be connected to the western regional grid that’s controlled by the California Independent System Operator, Kelly said. Utilities that belong to the CAL ISO including Southern California Edison Co., Pacific Gas & Electric Co. and San Diego Gas & Electric Co. “all have contracts with renewable power generators, and an ARES project could store energy from any or all of them,” he said.

“I think we’ve gotten over the fact that this technology isn’t proven -- so that is behind us now,” said Roberts, from the storage association. “It’s a real industry and it’ll grow faster than a lot of people might think, he said.

Copyright 2012 Bloomberg


A biogas plant concept from Weltec Biopower

Europe Versus Renewable Energy?

Tildy Bayar, Contributor Wednesday morning’s 'Regulation and the Marketplace' panel discussion at POWER-GEN Europe in Amsterdam got off to a lively start with a presentation from Randy Mott, president of Polish biogas- and geothermal-bas...
Uzbekistan flag and map

Uzbekistan’s Ambitious Wind Power Target Signals New Energy Politics

Linas Jegelevicius, International Correspondent After rolling out its renewable energy strategy through 2019 in April, the Central Asian Republic of Uzbekistan has set its sights on ambitious goals: Build three 100-MW solar power plants and generate more than 1 trillion...
Wind turbines

Why It's Time To Get Real About Energy Security

Hannah Smith, Contributor Energy is Europe’s quiet crisis. While the clamour of failing economies, desperate migrants and political clashes grabs the headlines, energy policy is rarely front-page news, but it should be — the statistics are shocking.
Egypt flag

Egypt's Renewable Energy Drive Gains Steam

Andrew Burger, Correspondent There's a lot of action in Egypt's rapidly developing solar and renewable energy market space. Nearly 5 GW worth of solar power development agreements have been signed so far this year, while Egypt 's New and Renewable Ene...


Volume 18, Issue 3


To register for our free
e-Newsletters, subscribe today:



Applying Renewable Energy - Online Training

RENAC Online offers a selection of courses on a wide variety of renewabl...

ImagineSolar | Solar PV Project Experience: Advanced 5-day Workshop...

40 Advanced Credit Hours Advanced 5 Day Workshop IREC Accredited Continu...

ImagineSolar | Advanced Lab Day: Solar PV Design & Installation (Au...

Advanced Lab Day: System Design & Installation  $195 – 8 ...


A Baseball Cap, the #ElonEffect, and the Power of a Personal Solar ...

A few weeks ago, I wrote about the Elon Effect in relation to Tesla...

How to Reduce Soft Costs With a Critical Path Map

For solar installers, soft costs are a fact of life. However, they don&r...

Meteorological Technology International Magazine - SENSORS AND SENS...

Over the past 10 years, these sensing technologies have spread tre...


Tweet the Editors! @megcichon @jennrunyon


Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now