Transcript Recent History (1980s

Energy Storage in the U.S.
Aaron Townsend
National Renewable
Energy Laboratory
October 28, 2013
Colorado Rural Electric
Association Energy
Innovations Summit
Outline
• Brief History
• Current Installations
• Value Challenge
• Additional Value Created by Deployment of
Renewables
• Conclusions
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Ancient History of Energy Storage (<1980)
Challenges of meeting variations in demand provided early
motivations for storage (<1980)
- Projected nuclear builds (100s of GW)
- Fuel Use Act of 1978 (no gas or petroleum plants)
0.9
60000
0.8
Load (MW)
50000
0.7
0.6
40000
0.5
30000
0.4
0.3
20000
Summer Maximum
Winter
Spring Minimum
0.2
10000
0.1
0
0.0
0
24
48
72
96
Hour
3
120
144
168
Load (Fraction of Annual Peak)
1.0
Installed Capacity
4
Limited Activity
– PHS costs increase, increased
siting challenges
– Cheap natural gas
– Limited nuclear build out
– Exotic technologies remain
costly
– Cheaper and/or easier to meet
variation in load and capacity
requirements with conventional
generation resources
Electric Sector Natural Gas Price ($/tCF)
Recent History (1980s-2000)
6
5
4
3
2
Fuel Use Act
1
0
1970
1975
1980
1985
1990
5
1995
2000
Existing Storage Facilities
CAES: 1 Plant
(110 MW)
Others (<100 MW
total): A few
batteries, SMES,
mostly for local
power quality issues
Conventional Pumped
Hydro: ~ 22 GW
6
More Recently
•Renewed interest in storage
•Emergence of energy and ancillary service
markets
•Natural gas price volatility
•Perceived role of storage in enabling renewables
10
Electric Sector Price ($/tCF)
9
8
7
6
5
4
3
2
1
0
7
Current Activities
• Many proposed plants
• Renewed RD&D funding via DOE ARRA and
ARPA-E
• California AB 2514
• Challenging economics
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What is Storage Worth?
• Standard metrics (LCOE) are not particularly useful
• Storage provides multiple values, but not all can be
monetized
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Value of Storage in Restructured Markets
Historical Values of Energy Storage in Restructured Electricity Markets
Market
Evaluated
Location
Years
Evaluated
Annual Value
($/kW)
Assumptions
Energy
Arbitrage
PJMa
2002-2007
$60-$115
12 hour, 80% efficient device. Range of
efficiencies and sizes evaluated[1]
NYISOb
2001-2005
$87-$240
(NYC)
$29-$84
(rest)
10 hour, 83% efficient device. Range of
efficiencies and sizes evaluated.
USAc
1997-2001
$37-$45
80% efficient device, Covers NE, No Cal, PJM
CAd
2003
$49
10 hour, 90% efficient device.
NYISOb
2001-2005
$163-248
USAe
2003-2006
$236-$429
PJM, NYISO, ERCOT, ISONE
USAe
2004-2005
$66-$149
PJM, NYISO, ERCOT, ISONE
Regulation
Contingency
Reserves
a
Sioshansi et al. 2009
Walawalkar et al. 2007
c Figueiredo et al. 2006
d Eyer et al. 2004
e Denholm and Letendre 2007
b
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Value of Storage in U.S. Markets
Required Storage Capital Cost ($/kW)
4000
Capital
Charge Rate
3500
9.8%
3000
12.0%
13.9%
2500
2000
1500
Arbitrage Only
Regulation Only
1000
500
Contingency Only
0
0
50
100
150
200
250
300
350
Annual Benefit of Storage ($/kW)
Arbitrage alone is generally insufficient to support most storage
technologies, which are generally >$1,000/kW
Renewable deployment will increase opportunities for economic storage
deployment…..and also the competition
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Bottom Line on Value
• Current market conditions supports bulk storage at
capital costs under $2000/kW for a 6 hour or more
device
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Impacts of Renewables on the Grid
• Storage is often perceived as “necessary” for
renewables to achieve a large (>10%? >20%?)
penetration.
• Renewables are seen as a source of value for
storage
• Can renewables be used without storage?
• How do renewables impact the grid?
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So What are the Opportunities?
• Renewables increase the already existing value (and
size) of markets for storage
• Arbitrage/load leveling/unit cycling
• Operating reserves
• Transmission alternatives
• How do storage economics compete with the
alternatives?
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Flexiblity Supply Curve
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Conclusions
• Low-cost natural gas is currently the dominate force
in U.S. electric power sector
• Storage is being constructed based on R&D support
and mandates.
• Costs will need to be reduced substantially for
storage to be cost competitive
• Storage is undervalued in existing markets and it is
still difficult to assess the true value and opportunities
for energy storage in the current and future grid
• Storage faces competition for other sources of
flexibility
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Thank You
Contact information:
[email protected]
303-275-3272
Current Capacity
18
Example Analysis
28
90
2X NG Prices
80
Base NG Price
24
70
20
60
16
50
40
12
30
8
20
Storage Annual Value (M$)
Storage Value ($/kW)
100
• 300 MW energy-only
device in Colorado
4
10
0
0
0%
10%
20%
30%
40%
50%
60%
Wind and Solar Penetration
140
Storage Value ($/kW)
• Energy-only device
compared to reserves
devices
160
120
100
80
60
40
Base Energy Only Device
100 MW Reserves Only
20
300 MW Energy + Reserves
0
0%
10%
20%
30%
40%
50%
60%
VG Penetration
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