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Page added on November 25, 2012

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Energy storage systems signal arrival of ‘baseload’ renewables

Alternative Energy

It has been widely thought that the arrival of cost-competitive rooftop solar PV systems would be the biggest game changer in the electricity market. But it may be that the emergence of affordable energy storage systems will have an even more profound impact.

There are predictions that the energy storage market is going to boom. One survey suggested that $30 billion will be spent on energy storage in the next decade in Australia alone. In the US, where $1 trillion is expected to be spent on electricity network infrastructure in the next 10 years, at least one fifth of that – or $200 billion – will be spent on energy storage.

The big question is who is going to benefit most from that investment – the customer, or the utility that delivers or sells the electricity. Or maybe even both. Most people are still trying to figure that out.

There is little doubt that there is huge interest, and likely huge demand, for the product. Given that the arrival of solar PV has enabled homeowners and small businesses to produce their own energy, it is only natural that they would want to store it.

An analysis by Energeia this year said that as a result of cost reductions in the technology, it predicted there would be 421,000 residential energy storage systems in Australian homes by 2021 – nearly half the number that currently have solar on their rooftops. The new pricing mechanisms that are being introduced into Australia – high rates for peak consumption and low rates for overnight – make it particularly attractive to have both solar, which can draw down cheap energy from the sun during the day, and energy storage – which can store excess energy and draw from the grid at low overnight rates. It effectively doubles the attraction.

Richard Turner, the CEO of Adelaide-based Zen Energy Systems, last month unveiled a new product called Freedom Powerbank, an energy storage system that will allow households to store enough electricity to cater for their average daily usage. An email sent out to 4,000 of Zen’s solar PV customers generated an enormous response – one person a minute signing up for more details, according to Turner.  The response from utilities and international customers has been equally effusive, he says.

Who will benefit from an energy storage system in the home? The home-owner, the utility, or both?

Turner describes his product as a “world first,” because it uses proprietary software to capture the energy produced by solar, wind, or from the grid, and allows it to be used when the customer chooses. We have created the most functional energy storage system at one end and at the other end broke through major cost barriers. What we developed is the first battery operating system for renewable energy systems.”

Production of the Freedom Powerbank for households begins in Adelaide in January next year. Turner says the units will cost $29,500 – offering a payback of 7-8 years, but he says the cost will fall as manufacturing techniques improve and some of it is outsourced to cheaper facilities overseas. Larger units will be available for small businesses – who will be able to use the systems to ensure they retain their power sources through any outages – and are being tested by utilities.

Turner says the storage system is a game changer because it is clear that solar PV will be the power supply of the future, and this enables households to store that energy and utilise what is effectively “baseload” renewables.

“We have got a massive problem around peak demand,” Turner says. The proposed introduction of time-of-use pricing, along with smart meters, means that consumers will be paying as little as 7c/kWh at  time, but up to 52c/kWh in peak periods. That is already occurring in Victoria.

“We saw this coming and that is what we designed this for. It will enable consumers to load shift inside their own home – they can source cheap energy from solar during the day, or draw down from the grid at night, and save it for use later.”

Turner says focusing on the software component – with Zen’s joint venture partner, the US-based Greensmith Energy Systems – was a cheaper and more effective method than trying to deliver a better battery – a pursuit that has been the ruin of several aspiring battery manufacturers as they found their technology undercut by the latest developments elsewhere.

“We went the other way, we’ve talked to the people operating the grid and looked at the functionality and created a battery operating systems with three layers of software,” he tells RenewEconomy. This covers a utility control system that can address load shifting and frequency problems, and brings the individual units together to operate as one block if needed. The second layer has rich data analytics to optimise grid function, while the third layer is an “active balancing battery management system”, that ensures optimal performance from the battery cells.

Turner says utilities are also very interested in his product – even if they have yet to “get their head” around the issue, and how it fits in with their business models. Most accept, however, that the introduction of such systems is inevitable. “It will really challenge the retail business model,” Turner says. “But it’s going to be challenged anyway.”

He suspects some utilities will use storage systems to manage their grids, and some are already testing units in the 100kWh to 1.5MWh scale. And they will also offer such systems to their customers, but possibly not at the 20kWh scale – they will want a margin from providing as much electricity as they can, so they may offer systems with storage limits of 5kWh or 10kWh to their customers.

“People will put these systems into their home – and will be put on a contract where there is a heavy penalty to draw on power at peak times. And the utilities will have the right to pull power back into the grid when needed. Ultimately though, it is the consumer who will control the energy over the house.”

Turner says it does offer the opportunity to go off grid as well. This is particularly attractive to those dreaming of homes on rural blocks who want to look after their own energy systems. “We are going to see a trend toward modern off-grid living,” he says. His company has received 200 inquiries already for off-grid housing developments. And mining camps are also interested.

And how will the system be integrated with electric cars, and the ability of those batteries to also provide storage? Turner sent us this emailed response:

Q. Do you empty the fuel from your car into your generator at home?

A. No. Then most likely you won’t flatten your car to power your home.

He says the Zen Freedom PowerBank will be provisioned in the future for DC to DC fast charging to draw and store off-peak grid power or solar power to charge EVs quickly whenever it’s required.

Here’s a graphic display of what Turner sees as the problem for electricity grids, and the solution that energy storage systems offer.



12 Comments on "Energy storage systems signal arrival of ‘baseload’ renewables"

  1. BillT on Sun, 25th Nov 2012 2:39 pm 

    More electric dreams. Forget about it!
    A stand alone power system with battery backup is still the way to go for a secure residential future. The more complicated a system, the more opportunity for failure and higher costs. Get off of commercial systems totally and soon. You will never own an electric car so there is no reason to think about powering it. Power down now and avoid the rush.

  2. MrEnergyCzar on Sun, 25th Nov 2012 3:52 pm 

    @BillT, That’s what I did, I powered down, went net-zero solar got the electric car…. about the only thing I don’t have is that elusive $15K massive battery bank. Not sure why this small one in the article cost’s $29k, looks like sealed batteries too which don’t last as long…


  3. Kenz300 on Sun, 25th Nov 2012 4:27 pm 

    Wind and solar are the future. They get less expensive and can generate more power every year. The technology continues to improve and improved storage solutions will push their adoption even higher.

    Climate Change is real. It is time to transition to safe, clean alternative energy solutions.

  4. actioncjackson on Sun, 25th Nov 2012 4:50 pm 

    They’re smoking hopium, a dangerous drug with side effects include living in an alternate reality of lies and stupidity. The manufacturing and distribution process is dripping with hydrocarbons.

  5. Kenz300 on Sun, 25th Nov 2012 4:58 pm 

    There is hope for the future………………

    Quote from the article below —- ” Global investment into renewable energy sources has for the first time surpassed monies spent on fossil fuel power plants, Bloomberg New Energy Finance has found.

    Biomass, solar, wave, and wind installations drew approximately US$187 billion last year, according to the report. In contrast, a total of $157 billion was invested into traditional power sources. Bloomberg published its findings on Friday.”


  6. Shaved Monkey on Sun, 25th Nov 2012 9:51 pm 

    “…the units will cost $29,500 – offering a payback of 7-8 years”
    That would take me 30 years to payback unless power costs start doubling

  7. Piet de Wit on Sun, 25th Nov 2012 10:06 pm 

    In the Netherlands the biggest crowd funding action but 2 worldwide bought 2 windmills for 16+ years free electricity through

  8. Rick on Sun, 25th Nov 2012 10:23 pm 

    I don’t see what is so great about this, so called storage system. It still uses some kind of batteries.

    Solar batteries, good ones are not cheap, but not $29k. They also do not last forever, 10 – 15 years, or there about. Off-grid is the way to go. But, one must first design and build a real house. One that has very little load requirements. Like a passive solar home, that’s super insulated. Homes like these require very little NRG to heat, no AC, etc.

    Unfortunately, there are very few homes like this in the US.

  9. BillT on Mon, 26th Nov 2012 3:26 am 

    action, you are correct. NONE of these will last longer then their wear-out expectancy, meaning that when oil goes, within 10 years or so, all renewables will also die.

    They CANNOT be made using renewable energy. These batteries are no different. They ALL use minerals and materials that have to be mined, refined, smelted,formed, machined, assembled, delivered and installed. In 10 years, repeat the cycle.

    But, you say they can be recycled? How? Do YOU know how much of the materials can be recycled or how much energy it would take? No, you don’t. the Techies dance around that fact because it is the one that proves they are lying. NOTHING will replace oil to keep your life on the level. Not even close. Think 3rd world levels and you will see your future.

  10. Mike in Calif. on Mon, 26th Nov 2012 7:53 am 

    After the collapse, and after the chaos when some regional order is restored, when some form of small recovery occurs in a less populated world, some simpler version of this may beome the norm. With a spotty grid, or a time segregated supply (business/industry in the day, residential at night), this general configuration might reign.

    Lead-acid is not well suited if the arrangement deep cycles them, but they’re likely to be common just because they’re easy to make. Wind, sure. Advanced solar will probably not survive as any remaining ability to manufacture semiconductors will go to the revived state (military). Simple solar, like nanocrystalline/chemical cells, maybe.

    It is interesting to ponder what “recovery” will look like after the inevitable crash. It is even possible, in a reduced population/simplified world, that conventional oil might become “cheap” again (due to few customers), but the machines that use it become enormously expensive. In contemporary terms, imagine gas at $10/gallon but the family station wagon costing $200K due to its energy and material inputs.

    As long as some science survives, people will become frugal and clever with whatever power they can make, capture and store. Of course, they’ll be using a lot less of it.

  11. Kenz300 on Mon, 26th Nov 2012 10:26 pm 

    Alternative energy sources will be integrated into the grid and grid operators will adjust to new ways of doing business.

  12. BillT on Tue, 27th Nov 2012 1:59 am 

    Dream on Kenz. Nothing is going to save the world of today in any meaningful form or amount. The power grid in America is antique. There will be no meaningful revisions or additions. Never. Who is going to pay for them? YOU?

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