The demand for solar power will continue to grow rapidly for the foreseeable future as part of the transition to cleaner sources of power.
JOHN GARTNER, Pike Research, Boulder, CO USA
The demand for solar power will continue to grow rapidly for the foreseeable future as part of the transition to cleaner sources of power. But along with that growth will come an intensification of the need to integrate the intermittent resource with the grid. The expansion of complementary energy storage, in the form of stationary devices and the batteries of electric vehicles, will create a more conducive environment for solar adoption.
By the end of 2010, Pike Research estimates that the total cumulative solar power capacity in the United States reached about 2.9GW, or approximately 0.3% of total electrical power capacity. However, penetration in a region can be much higher in states requiring clean energy production via renewable portfolio standards. Between 2011 and 2013, Pike Research estimates an additional 8-11GW of solar power will be installed. With each additional megawatt comes an increasing need to balance the naturally-occurring variations in solar power production.
As the percentage of power from solar grows higher in the coming years, there will be a greater need to balance the variations in power output. Other generation facilities, such as hydropower or power plants that burn fossil fuels, have historically been used to offset these variations. But energy storage, which uniquely can be used to absorb any surpluses in solar power when supply exceeds demand, can be a cleaner and better performing alternative
Storage for ancillary services
As with all forms of power generation, small mismatches between ongoing power delivery and demand can cause temporary drops in the voltage. Energy storage that uses surplus renewable energy can be a cleaner and more efficient alternative than fossil fuel generation to optimize grid performance. Using storage to execute these ancillary services, which include voltage and frequency regulation, will grow from a $230 million to $2.9 billion global industry between 2011 and 2015, according to Pike Research. Lithium ion batteries will be the most commonly adopted technology to support renewable power, with 72% market share in 2015.
Battery technologies are better-suited to providing ancillary services because they can respond in microseconds, and the power level can be closely controlled. By comparison, starting up and turning off a power plant for ancillary services is slower and will waste some of its energy. Other battery technologies used in ancillary services include flow batteries and advanced lead acid batteries.
Energy storage is also used to support solar power plants to enhance power quality and to enable renewable energy generation to be matched to later demand. The incorporation of energy storage to offset the intermittent delivery of renewable energy to create consistent, dispatchable power, is known as “renewable integration.” For example, deployments of lithium-ion batteries are being used to buffer multi-megawatt solar installations that provide output at varying levels based on environmental factors. To enable more consistent power, grid energy services companies are expected to install energy storage equivalent to 1−3% of the installed solar capacity.
Many states currently do not have financial rules or operating regulations in place that allow non-utilities to offer ancillary services. Markets in some states, such as California and New York, are slowly opening up to permit entities to use energy storage for these services. After the rules are in place (which is expected during the next few years in most states) that enable organizations to recoup their investment in energy storage, we will see an acceleration of storage being used to support distributed renewable power.
Energy storage is also being deployed so that solar power generated during the day can be stored for use later in the day or overnight in an application known as time-shifting. Time-shifting with storage enables solar installation operators to maximize their revenue by selling lower value energy produced early in the day at more lucrative peak times (see Figure).
Several large scale projects integrating storage with solar power plants are underway. For example, at the Solar Technology Acceleration Center (SolarTAC) in Aurora, Colorado, a 1MW storage facility will be used for power smoothing and time-shifting. The project is being managed by utility Xcel Energy and energy services company Xtreme Power, and will demonstrate how storage can be used to assist with distributed grid power management. For the next several years, projects of this nature will grow in scope and collect important performance data indicating the benefit of storage to solar power plants. If positive results are achieved, commercial adoption will follow.
By 2015, the annual investment in energy storage for supporting renewables through integration and time-shifting services will grow to 2.8GW annually, according to Pike Research. Approximately 10% of this investment, or 280MW, will support solar installations, while the remainder will be used in conjunction with wind and hydro generation.
Electric vehicles as storage devices
In addition to the batteries that will be deployed in support of distributed solar power plants in the coming years, a mobile source of potential auxiliary power will be arriving in driveways everywhere. More than 3.1 million electric vehicles (EVs) will be sold between 2011 and 2015. This will create a total of 52MW hours of vehicle batteries inside electric vehicles that could potentially be used to assist in strengthening the grid and accommodating the demands of integrating renewable power.
|Figure 1. Global energy storage installations supporting renewable energy 2011-2015. SOURCE: Pike Research|
In addition to providing power for both battery-electric and plug-in hybrid vehicles, the batteries can store solar power for later use. Applications include providing emergency power to the local buildings, or for selling the power to the local grid when it is the most financially beneficial to the vehicle owner. As with stationary energy storage, vehicle batteries, which contain between 5 and 24kW-hours of storage, can accelerate the return on investment for solar panels and the vehicles through “energy arbitrage,” which stores energy when it is economical and profits from selling it back to the grid at premium rates.
The current crop of electric vehicles does not include the electronic inverters to take power from the batteries and deliver it to the grid or the building (applications known as vehicle-to-grid, and vehicle-to-building, respectively.) However, the technology for upstream power delivery for vehicles exists and is being used in a pilot project run by the University of Delaware and grid operator PJM. The project uses several vehicles enhanced with technology developed at the university. Individual vehicles are likely to provide from 1−3kW of power to the grid. However, auto manufacturers are concerned that using vehicle batteries as storage devices could reduce the batteries’ life cycle and are not likely to embrace their usage in this matter until a few years of data has been collected.
Despite reservations from many automakers, several integrated companies that are excited by the synergies between EVs, storage, and solar are developing applications integrating all three.
Companies including Itochu, Sanyo, and BYD see residential solar fitting in well with energy storage and EVs. Solar panels can be connected directly to vehicle charging equipment to give EV owners the flexibility to determine whether to immediately consume or store solar power. Stored solar power can also provide emergency backup to the building should power go out. Consumers who have installed solar power at their homes can also leverage their investment in an inverter and other equipment to interface with the grid to deliver power stored in vehicle batteries. This reduces the total equipment cost and can lead to a faster return-on-investment for both solar and the electric vehicles. Several trials are underway around the globe to evaluate the benefits of combining the technologies.
Electric vehicle charging equipment companies including Aerovironment and Eaton Corporation are also developing energy storage units that will be packaged with their charging equipment. This storage could be integrated with a residential solar system to provide the benefits of lower cost power to the building or for sale back to the grid.
Using solar power to charge an EV also provides true emissions-free transportation, which is very attractive to environmentally-minded consumers. While these applications are cutting edge today, interest is likely to grow in the second half of the decade.
Requirements for future growth
Energy storage has not historically been viewed by regulators as favorably as renewable power or even smart grid technologies as a technology for enhancing energy efficiency and reducing emissions. However, storage of renewable energy is slowly starting to gain backing as a clean resource. Regulators, legislators, and other governmental decision makers are gaining a better understanding of storage’s enabling role in expanding the use of solar power.
The federal STORAGE Act of 2010, proposes a 20% investment tax credit for energy storage. Bill co-sponsor Ron Wyden (D-Oregon) stated that “Growing our ability to store renewable energy not only promotes a more efficient use of energy resources, it makes energy sources like wind and solar just as reliable as conventional energy sources….” The bill is likely to be voted on by the Senate in 2011.
In California, assembly bill 2514, which became law in September of 2010, begins the process for requiring storage to be added to the state’s power grid in order to enable the state to meet its required expansion of renewable power. The law, which is the first of its kind in the country, requires the state’s public utilities commission to establish milestones for power producers to incorporate storage into their system beginning in 2015.
The need for a comprehensive federal plan for utilizing storage to benefit renewable and other power generation was recently spelled out by the director of one of the U.S. Department of Energy’s largest research facilities. Eric D. Isaacs, the Director of the Argonne National Laboratory, wrote an editorial for website The Huffington Post about the need for expanding storage on the grid, stating that “[Adding renewable] energy generation does us little good if we can’t save that electricity for use at the times when the wind doesn’t blow and the sun doesn’t shine.”
When used in combination, solar power, energy storage, and electric vehicles have the potential to provide truly emissions-free transportation while enabling a greater percentage of renewable power. Investment in each technology is likely to spawn additional growth in the others.
John Gartner received his Bachelor’s degree in business administration from Temple U. and a Master’s degree in education from Arcadia U. and is a Sr. Analyst at Pike Research, 1320 Pearl Street, Suite 300, Boulder CO 80302 USA; ph.; 503-975-2976; email firstname.lastname@example.org.