Energy Storage – A Disruptive, Multifaceted & Beneficial Technology

Pramod Kulkarni, Senior Advisor, Customized Energy Solutions
Pramod Kulkarni, Senior Advisor, Customized Energy Solutions

Pramod Kulkarni, Senior Advisor, Customized Energy Solutions

Albeit a few decades late, the electricity industry is following in the footsteps of the information technology industry with changes that are fast demolishing decades-old business structures and practices. Thirty years ago, the IT industry was revolutionized by migration from centralized, large-scale computing, data processing and storage to customer-level decentralized tools for personal computing. Today large scale centrally-generated power delivered over distribution wires are being replaced by locally generated electric power for consumers. This transformation is being enabled by new, smaller and cleaner electric generation and storage technologies that have changed who generate electricity, when it is generated and how it is sold. A common manifestation of this revolution is the solar photovoltaic systems that now provide rooftop electricity for home consumption and sell the surplus back to the utility. Faster processors alone could not have brought about the information technology revolution without low-cost data storage; similarly, distributed clean power generation technologies like solar (and others) are contributing more to the electric grid and consumers thanks to new energy storage technologies that have reached the market. If necessary, low-cost energy storage now makes it possible to replace the just-in-time production of conventional power by stored power, imparting economic as well as environmental benefits. Electrical energy storage has diminished the need to continuously run and cycle large fossil fuel generators and has also helped mitigate the problems of solar and wind power intermittency that cause power quality problems. 

 Electrical energy storage has diminished the need to continuously run and cycle large fossil fuel generators and has also helped mitigate the problems of solar and wind power intermittency that cause power quality problems  

The new electricity storage technologies come in many forms and are the result of advances in material and chemical sciences and engineering processes. The lithium-ion batteries commonly used in laptop computers and cell phones have been scaled up for utility applications ranging in size from a few kilowatts for home use to hundreds of megawatts for utility-scale applications. Variations of lithium-ion technologies are now available that match varied power and energy applications’ needs. Batteries that do not need lithium are being developed and deployed, as are other forms of energy storage such as flywheels and thermal storage. Although it is difficult to match Moore’s law, lithium-ion batteries costs have come down by 70% in the last ten years. When combined with energy storage, some of the utility-scale solar plus storage projects are selling wholesale electricity at 4 cents a kilowatt hour and beating the price of electricity from natural gas by a few cents. At the residential level, battery packs are enabling reducing the high demand charges that homeowners often pay during summer months. 

The revolution enabled by energy storage is just beginning. Storage combines with communications, controls, and computing power to create efficient competitive markets that capable of trading power on timeframes as short as five minutes, 15 minute and one-hour durations. Energy storage is giving more flexibility in mitigating problems created by solar and wind generation that does not match the utility’s demand curves. New algorithms and the use of machine learning allowing energy storage systems to optimize battery use and allowing cell-level charge management, increasing the safety of batteries.

As energy storage costs diminish further and energy storage is available in many forms and formats, cross-industry collaborations will create opportunities that otherwise were inconceivable or economically infeasible. For example, Tesla’s Giga factory is mass producing batteries for electric vehicles and Tesla uses the same batteries for home use with solar or as back-up power. Similar batteries that are long-lasting and requiring less maintenance are also replacing lead-acid batteries connected to the uninterrupted power supplies to ensure data center reliability. In a few years, we’ll often wonder how we lived without energy storage.