Everything is Coming Up Battery Storage

Energy innovation has an equivalent of singularity: the day when affordable, scalable, reliable battery storage technology collides with intermittent generation sources like wind and solar to stabilize the availability of clean energy when the sun does not shine and the wind does not blow. The latest International Energy Agency (IEA) report and recent corporate news in battery storage investments suggests this day is not only increasingly possible, but may it be arrive far sooner than the most optimistic observer expects. The IEA found that the world installed an eye-popping 153 gigawatts (GW) of clean energy capacity in 2015, primarily wind and solar. Clean energy sources, for the first time, now exceed the global installed capacity of coal. While how many homes a gigawatt can power depends on the source, 153GW represents enough average solar power for over 25,000,000 U.S. homes. And last week alone, four companies took important steps toward increased deployment of new battery storage technology. Lockheed Martin and Wal-Mart are ramping up battery storage installations at their facilities. LG Chem entered into a battery technology partnership with SunRun. Elon Musk announced Tesla Energy’s next generation residential solar roof and battery storage system. From big companies to clean energy start-ups, there appears to be a growing consensus that there is money to be made in self-generation and battery storage.

IEA also revised upward its estimates on the global deployment of wind and solar. It now forecasts that by 2021 clean energy sources will supply 28% of global generation capacity, an amount exceeding, “combined U.S. and European Union generation today.” IEA attributes last year’s dramatic uptick in clean energy installation to increasingly lower costs.  The average global cost of wind generation has dropped by 30% and the average cost of solar generation has plummeted over 60% in recent years. The downside, from a free market viewpoint, is that this rapid increase in clean energy generation is partially driven by subsidies that heavily favor wind and solar. Renewable subsidies, nonetheless, do not appear to be going away anytime soon as a matter of public policy. Market actors will therefore continue to innovate and install new renewable generation capacity in response to these deliberately chosen policy signals.

On the flipside of the “energy singularity” coin, Wal-Mart, Lockheed Martin, Tesla, LG, and SunRun are making big moves in battery storage innovation. Wal-Mart, already a leader in corporate self-generation with 145 megawatts (MW) of installed solar capacity worldwide, is ramping up battery storage investments at it facilities. The retailer now has 17 battery storage projects at its locations in California. Wal-Mart, in addition to striving for a 100% corporate renewable energy goal, believes its investments in self-generation and storage will be critical to helping communities it serves re-build following natural disasters.

Lockheed Martin announced the installation of a 1MW GridStar generation and storage system at its Syracuse, NY facility. Lockheed Martin’s GridStar lithium energy storage technology is intriguingly scalable, comprised of modules of smaller batteries. The defense industry leader aims to reduce emissions and utility bills through self-generation and storage. It plans to install GridStar systems at more of its facilities.

Elon Musk announced Tesla Energy’s new solar roof and battery storage system. The roof tiles are available in four different tile styles that are more aesthetically appealing than conventional rooftop solar, as they look like traditional roofs. These systems will be sold in tandem with a Tesla Power Wall battery. A Tesla Powerwall can store up to a day’s worth of energy for the average American household. While there are plenty of questions about how this technology will deliver on its promise, it’s a big, unexpected move from Tesla.

Finally, last week LG Chem and SunRun announced a partnership to create new battery storage solutions for residential solar. This partnership will compete directly with what will be either Solar City or Tesla Energy, depending on whether or not the proposed merger of Elon Musk’s two companies reaches fruition.

Forecasts about the future of energy are notoriously wrong, especially in the renewable energy space. But these recent developments indicate that the private sector increasingly finds business opportunity in investments in renewable generation capacity and in battery storage technology. The future of energy will likely continue to include additional breakthroughs in both areas.


In Depth: Innovation

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