Much of the discussion at VERGE San Francisco and Power Analytics' 20/20 Vision-Driven Power Conferencein October centered on a familiar topic in our industry: the need to develop grid-scale energy storage to make renewable energy-based microgrids successful, and the billions of dollars in potential profit that await the companies that can successfully do so.
One of the biggest obstacles is developing and implementing low-cost long run energy storage technologies. As one conference panelist at VERGE told GreenBiz.com, investors will not seriously consider financially backing technologies like solar-plus-storage until capital costs come down enough to guarantee 10% to 15% returns on their investments.
Once cost-effective energy storage is available, the door should be open for affordable microgrids powered by renewable sources to be deployed in a variety of commercial, industrial, and utility applications around the world.
The focus of the work to date has been on various battery technologies to provide the long run energy storage. On average, batteries represent about 30% of energy storage project costs, making them a key element to determine the financial feasibility of any renewable or microgrid project. More recently, shorter runtime energy storage solutions like flywheels have been introduced to supplement the batteries and improve their cost position. These devices can support frequent discharges and recharges and respond in milliseconds to keep power flowing. This, in turn, reduces the demand on the batteries and extends their useful life, which means less frequent replacement and lower first cost as fewer batteries need to be deployed.
Energy storage is one of the critical enabling technologies to making microgrids and renewables cost effective. But batteries by themselves aren’t sufficient — newer approaches such as flywheels can augment batteries in microgrid applications, helping reduce both capital and operating costs. Put simply, they can help these investments deliver on their promise of affordable, renewably powered, and resilient microgrids.