With increasing levels of penetration of variable wind and solar generation, battery storage is seeing growing demand as a resource to support system flexibility.
According to a new study from the International Renewable Energy Agency (IRENA), ‘Battery Storage for Renewables: Market Status and Technology Outlook’, there are four main application areas in which batteries are being deployed to increase the share of variable renewable energy and improve electricity supply reliability.
• Island systems and off-grid/rural electrification with renewable energy deployment
• Households with solar photovoltaic (PV)
• Variable renewable energy smoothing and energy supply shift
• Fast, short-term electricity balancing in ancillary markets.
However, the key drivers to battery deployment vary by the application and the requirements are unique to each location.
Battery storage drivers and requirements
For islands and off-grid applications, the drivers include the high cost of diesel fuel and a desire to integrate greater amounts of variable renewable energy while maintaining electricity supply reliability. Solar PV and battery storage at the household level is driven by government support, concerns over electricity supply in areas with a weak grid and economic trends. These include decreasing costs of small-scale battery systems, falling feed-in tariffs (FiTs) and rising retail electricity prices.
Batteries are being used for a number of purposes. These include smoothing and energy supply shift applications driven by incentive programmes and regulatory requirements to increase renewables use.
Other drivers are the need to control variable renewable energy feed-in to minimise variability and better match renewable electricity supply with area demand. Fast frequency regulation, technology developments and regulatory changes to compensate short-term balancing for fast and accurate response are also driving implementation.
Battery storage technologies
The study found that the market for battery storage technologies has developed rapidly over the last couple of years. There is sufficient evidence to show that industry participants can deliver operational solutions for the applications above, as well as others.
Previously, the market for power sector battery storage was dominated by sodium-sulphur batteries made by NGK Insulators in Japan. This has shifted recently towards lithium-ion chemistries due to current cost, performance and safety advantages over other battery types. The shift has been incentivised by governmental support and the influence of other sectors. The overall market is set to expand dramatically in the coming decade. A variety of battery types and designs will remain active in various niches of the field. While lithium-ion is a popular battery at present, advanced lead-acid, flow batteries and less developed batteries have also made significant progress. A healthy diversity of options will remain given the versatility of battery technology in a variety of applications.
The study also found that focusing on cost alone may be insufficient to accurately assess battery storage options. The application areas and case studies reviewed demonstrate that cost is just one of a large number of parameters determining battery choice.
For islands, cycle life, ambient conditions (particularly temperature), installation infrastructure and maintenance requirements are likely key criteria for battery selection. For household solar PV integration, cost, space requirements, safety, maintenance and warranty issues are likely to be significant. For frequency regulation and variable renewable energy smoothing, short charge and discharge performance is important. Some instances of frequency response may also require significant power availability over a short period.
The study also notes the benefit and value of a storage installation being used for more than one application. If local market and regulatory structures value the services provided by storage and other non-fossil fuel flexibility assets, the benefit can accrue to storage operators.
Battery storage challenges
Though battery storage technology has made significant strides, several key concerns must continue to be resolved for the technology to achieve its potential, the study found. These include continued safety and performance improvement, continued cost declines, and the development of international standards for data presentation.
Another problem is the availability of detailed project information. Safety concerns must be constantly evaluated, and novel, improved batteries must be researched, developed and demonstrated. Sustainability and access to component materials will also become increasingly important as the technologies become a more mainstream solution to grid flexibility. Non-traditional forms of flexibility like battery storage must be adequately compensated under governing regulatory structures to help modernise the electricity grid.