In a recent, little reported speech at IHS CERAWeek in Houston (the Mecca of the world’s fossil energy prognosticators), Chairman Norman Bay of the US Federal Energy Regulatory Commission (FERC) made an announcement unwelcome to many in the industry audience. “Developments in storage have the potential to bring economic and reliability benefits to consumers (and) perhaps even to be game changers,” Bay said. He pointed to recent analyses stating that energy storage costs should be halved in 5 years, “to the point where in some markets energy storage systems could be cost competitive with conventional [fossil fuel peaking plants]”.
It’s an increasingly common sentiment. Julie Fox Gorte, Senior Vice President for Sustainable Investing at Pax World Management LLC said last month that “storage changes everything!”. Dr. Gorte’s creditability on the issue is reinforced by her more than a decade of experience as a Senior Associate and Project Director at the Congressional Office of Technology Assessment, the specialist technology review unit which previously advised the US Congress. Her position is supported by some new utility industry views that there may be not be any gas-fired peaking plants built in North America after the end of this decade – mass storage will be doing the job instead, instantaneously and without any carbon emissions or air pollution.
This expanding potential impact for energy storage is of special importance given the rapidly accelerating installation of solar photovoltaic generating systems. In the US, for example, the Energy Information Administration has recently released data suggesting that in 2016 new PV systems will add more generating capacity than that delivered by any other new energy resource, including fossil fuels. The Washington Post noted that the EIA reports “planned installations for 2016 include 9.5 gigawatts of utility-scale solar — (versus) 8 gigawatts … of natural gas and 6.8 gigawatts of wind. This suggests solar could truly blow out the competition, because the EIA numbers are only for large or utility-scale solar arrays or farms and do not include fast-growing rooftop solar, which will also surely add several additional gigawatts of capacity in 2016.” (http://wpo.st/tQIJ1 )
Former FERC chair Jon Wellinghoff recently made a similar pronouncement: “Solar is growing so fast it is going to overtake everything…it could double every two years”. But the principal impediment to deeper penetration of solar power in mainstream energy grids worldwide has always been the inevitable intermittency of this otherwise versatile, abundant, carbon-free and increasingly economic energy resource. Cost-competitive storage will progressively address this limitation. It will be mitigated or eliminated in many markets within a decade, and in some within a matter of a few years.
And as Bloomberg New Energy Finance has pointed out, “When deployed together in distributed community and rooftop applications, solar and storage can also result in a reduced strain on the distribution grid and a deferred or reduced need for infrastructure investment. On a macro level, storage and solar could help reduce emissions by enabling a higher penetration of solar without variability challenges. The combination could also be transformative in emerging markets as a fast-track to electrification.”
In fact, one Bloomberg View commentator has argued that we should now think of the rise of solar and the emergence of power storage as a unitary, mutually reinforcing phenomenon: “…instead of thinking of solar and batteries as two independent things, we should think of them as one single unified technology package. Solar-plus-batteries is set to begin a dramatic transformation (which) has already begun…”. (http://www.bloombergview.com/articles/2015-04-08/clean-energy-revolution-is-way-ahead-of-schedule). As this transformation progresses, we will finally begin to access the full potential of the Solar Age.