As intermittent power sources, solar photovoltaic and wind energy require “baseline” power to fill in. That typically comes from traditional sources including coal, gas, and nuclear power. But utilities are increasingly exploring energy storage systems that charge up on renewable energy to provide that backup power instead.
Lithium ion is the go-to technology for utility batteries; however, it is an imperfect solution for long-duration energy storage, known as LDES. A report from the U.S. Government Accountability Office said that while lithium-ion batteries remain popular in the utility sector, high demand in other industries makes them an increasingly expensive solution. Also, the GAO reported other risks for grid operators, including fire and limited battery life. Perhaps most importantly, lithium-ion batteries do not have the storage capacity to last through the night or to ride out extended power outages.
A Chicken and Egg Problem or LDES
Some utilities are investing in other grid battery options for LDES as alternatives to fossil fuels or expensive lithium-ion batteries. The catch is that some of these technologies are relatively new commercially.
Kara Rodby, a principal at Volta Energy Technologies, an Illinois-based venture capital firm focused on energy storage, said the problem is that the alternative battery sector is dominated by startups just this side of the laboratory. These companies rely on investors rather than commercial orders for funding.
“There’s no doubt that LDES techs make more economic sense for eight-plus-hour storage needs,” Rodby said, “but there’s a chicken-and-the-egg problem of when that market will be developed and when startups can deliver a product at their theoretical price points.
Market uncertainty is underscored by the fact that most LDES battery tech companies are upstarts rather than established manufacturers with long track records. Rodby said utilities interested in LDES tend to want to partner with potential suppliers—who may front much of the costs—on pilot projects rather than fully committing to a tech provider that might not be around in five years.
Leaning Into Solar’s Potential
Yet, power providers have to start somewhere. Arizona’s Salt River Project (SRP), a not-for-profit utility near Phoenix, plans to expand its existing 20 MW of solar capacity rapidly. It will add 55 MW, which it says is enough to power 12,000 homes. The company has contracted 2,000 MW of its goal to add 2,500 MW of new solar by 2025.
Arizona’s solar resources are among the best in the world. Even so, they provide peak capacity for only about one-third of the day, according to Jerald “Chico” Hunter, manager of innovation and development at the SRP. “You solve any intermittency issues as a consequence of building long-duration storage for night use,” Hunter said.
Looking for alternatives to lithium-ion cells, SRP chose Germany-based CMBlu Energy for a 5 MW pilot project using the company’s SolidFlow batteries based on flow battery technology. These store energy in separate electrolyte tanks, one positive and the other negative, that is pumped into contact across a membrane to discharge electricity (or for recharging). Unlike lithium-ion batteries, tanks can be sized to fit storage requirements and discharge over extended periods. CMBlu’s batteries use solid carbon to increase storage density and are modularized for stacking.
A Tough Market for Startups
The company says the system can power about 1,125 homes for 10 hours. Hunter said that he appreciates the fact that the technology is new. Still, CMBlu has utility projects underway in Austria and Wisconsin and claims to have a secure supply chain for its components.
“Markets where there’s higher solar penetration are important in terms of driving that longer-duration storage,” said CMBlu USA president Giovanni Damato. “We’re seeing that in Arizona and California, really across the southwest. As solar spreads, LDES will increase penetration across the U.S.’’
Beyond lithium-ion and flow batteries, more exotic approaches, such as thermal batteries that store potential energy as heat, are emerging from laboratories and moving toward commercialization. Boston-based Fourth Power, for example, is building a 1 MWh demonstration facility that stores energy in molten tin.
Volta’s Rodby said that renewable energy penetration is certainly driving LDES development. However, startups will need to grow customers and production lines to become thriving suppliers.
“Overall, I think this is where strategic engagement can help make an investment case,” she said. “A utility company might be able to buy enough units to drive down that cost. I personally look for partnerships that are clearly trending towards a real commercial partnership, as demo projects and pilots are a dime a dozen.”
