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Gaurav Agnihotri

Gaurav Agnihotri

Gaurav Agnihotri, a Mechanical engineer and an MBA -Marketing from ICFAI (Institute of Chartered Financial Accountants), Mumbai, is a result oriented and a business focused…

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Who Will Take The Energy Storage Crown?

Who Will Take The Energy Storage Crown?

Renewable energy sources are getting a new lease on life thanks to rapidly rising cost of fossil fuel extraction and rising greenhouse emissions. According to a report from UNEP, last year saw an increase in global renewable energy investments to $270 billion, representing growth of 17 percent from 2013.

This shows that renewables are “brushing aside the challenge from sharply lower crude oil prices,” the report concludes. Renewables are already competing with oil and other fossil fuels, but to overcome its biggest drawback – that of intermittency in power generation– energy storage is still one of the most critical elements facing the renewables industry. As modern grids can only withstand around 40% of the renewable input before requiring any further modifications, energy storage will be pivotal to further grid penetration. Related: Midweek Sector Update: G7 Plans To End Fossil Fuel Era This Century

Tesla has already made a high profile move to solve this conundrum with batteries designed for both domestic and commercial use. Let’s take a look at some other promising storage technologies that can be commercially feasible in the near future; technologies that can, perhaps, compete with the likes of Tesla in the energy storage market.

New Global Investments in renewable energy by asset class, 2004- 2014

SoCal Gas’ ‘Power-to-Gas’ project

In collaboration with National Renewable Energy Laboratory (NREL) and the National Fuel Cell Research Centre (NFCRC), Southern California Gas Company (a subsidiary of Sempra Energy) also known as SoCal Gas is launching a technology in the US that can convert electricity into gaseous energy. This technology promises to provide an economical solution for renewable energy storage. Related: Time To Move Capital Into Next Bull Market – Part I

As Patrick Lee of SoCal Gas stated, “A power-to-gas system can help California meet environmentally-focused energy goals and solve a major energy challenge facing our nation: how to cost-effectively store excess power from renewables to meet energy demands when the wind does not blow or the sun does not shine.” The power-to-gas method produces carbon-free hydrogen gas by using electricity from solar and wind energy. The hydrogen gas can then be converted into renewable methane and stored for further usage. It can also be used as an energy source for fuel cells, vehicles, micro-turbines and other similar applications.

This technology could very well become a practical reality in the near future, as it requires less capital investment and has more storage capacity compared to batteries. Moreover, with the possibility of utilizing the vast natural gas pipeline infrastructure to store energy from solar and wind, the ‘Power-to-Gas’ project could become the largest storage technology in the world.

What is interesting to note is that the ‘Power-to-gas’ concept is not a new one – countries like Germany have already commercially developed this technology. Audi’s e-gas project was the world’s first industrial scale ‘power to gas plant’, and the 6 MW power to gas plant was also the first constructed by an automobile major.

Audi’s e- gas project that used the ‘power to gas technology’

Image Source: audi

Daimler all set to enter the stationary energy storage market

In another interesting move, the German auto giant Daimler is set to enter the stationary energy storage market by launching Mercedes-Benz branded lithium-ion batteries for residential and commercial usage.

The company already launched its first industrial scale storage facility in Germany in collaboration with The Mobility House AG and GETEC Energie AG, generating close to 500KW-hours of energy. The Mercedes-Benz energy storage plants will be sold by the end of June 2015 at Intersolar Europe, an international exhibition for the solar industry and its partners.

Harald Kroger of Mercedes’ electric drive program said, “[w]ith our comprehensive battery expertise at Deutsche Accumotive (A subsidiary of Daimler), we are accelerating the transition to sustainable energy generation both on the road and in the field of power supply for companies and private households, the technology that has proven its worth over millions of kilometers covered in the most adverse conditions, such as extreme heat and cold, also offers the best credentials for stationary use.” Related: Busting The “Canadian Bakken” Myth

It is interesting to note that Tesla once built lithium-ion battery packs and chargers for Daimler. Daimler even had a 3.9 % share in Tesla Motors Inc., which it sold for $780 million in October 2014 as the two automakers became competitors following the launch of Tesla’s model S.

With its eyes set outside Germany, Daimler is planning to invest more than $111 million in its subsidiary Accumotive. “We are currently analyzing international markets that look interesting to us, and so far, the U.S. seems quite interesting,” said Frank Spennemann of Daimler.

With Daimler now entering the market, the energy storage game is poised to become even more interesting over the next couple of years. A leader in the energy storage market will soon emerge, one who can balance utility with economy. But will it be Tesla, with its ambitious Gigafactory and well-publicized Powerwall system? Or, will Daimler eat up Tesla’s market share? Or, will the Power- to- Gas technology overshadow the other two?

By Gaurav Agnihotri of Oilprice.com

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  • Isaac on October 01 2015 said:
    There is a giant red flag for power-to-gas storage in CA and it has to do with the drought. The power-to-gas relies on converting water into hydrogen and oxygen. I don't think another competitor for the finite supply of water in CA would be a viable alternative for grid scale storage. The other method of using batteries made with terribly old technology doesn't seem smart either. It seems as though people are forgetting that batteries will generate a hazardous waste stream that only moves the burden into a different part of the environment. Its a game of chasing our tail when it comes to how to supply our energy needs.
  • Scottar on February 18 2016 said:
    The only efficient way of converting electricity to a storeable fuel is by some carbon based fuel like methane and via 4th or 5th gen nuclear power. The energy density of most renewables is anywhere from 1~5% that of coal or petro derivatives. Infrastructure and maintenance costs are unsustainable.

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