• 3 minutes "Biden Is Running U.S. Energy Security Into The Ground" by Irina Slav
  • 6 minutes How Far Have We Really Gotten With Alternative Energy
  • 9 minutes "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 12 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 10 days 87,000 new IRS agents, higher taxes, and a massive green energy slush fund... "Here Are The Winners And Losers In The 'Inflation Reduction Act'"-ZeroHedge
  • 8 days Energy Armageddon
  • 9 hours "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 4 days "Forget Oil, The Real Crisis Is Diesel Inventories: The US Has Just 25 Days Left" by Zero Hedge - 5 Stars *****
  • 8 hours Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 4 days "The Global Digital ID Prison" by James Corbett of CorbettReport.com
  • 4 days "Europe’s Energy Crisis Has Ended Its Era Of Abundance" by Irina Slav
  • 1 day Is Europe heading for winter of discontent with extensive gas shortages?
  • 4 days The Federal Reserve and Money...Aspects which are not widely known
  • 5 days Goldman Betting on Cryptocurrencies
  • 8 days Сryptocurrency predictions
  • 13 days Putin and Xi Bet on the Global South

Breaking News:

Oil Prices Jump On Major Crude Draw

The Problem With Oil And Gas Price Caps

The Problem With Oil And Gas Price Caps

The attempts so far to…

The Diesel Crunch Is Finally Causing Demand Destruction

The Diesel Crunch Is Finally Causing Demand Destruction

Diesel inventories have been at…

Nigeria’s Oil Industry Can Flourish Despite Oil Theft

Nigeria’s Oil Industry Can Flourish Despite Oil Theft

While Nigeria’s oil industry is…

Michael McDonald

Michael McDonald

Michael is an assistant professor of finance and a frequent consultant to companies regarding capital structure decisions and investments. He holds a PhD in finance…

More Info

Premium Content

Energy Storage Set To Boom In 2017

The problem with today’s power grid isn’t the lack of electricity but rather the lack of it at certain times. The United States has progressively moved towards adding renewable energy to the grid but solar and wind power are rather intermittent. Worst of all, some of this power is completely wasted because our grid is unable to store it properly. Tesla, along with other companies, has begun to solve this pressing issue.

Three new storage plants are in the works and they’re unlike anything before. The plants will be completely reliant on lithium ion storage. Lithium powered batteries have seen rapid reductions in price in the past several year’s thanks to the high demand for electric cars. Tesla is also developing a gigafactory in Nevada to mass produce these batteries, some of which will be used in the storage plant. AES Corp. and Altagas Ltd. are the other two companies creating battery plants in California. The Altagas plant was activated January 27th. AES has another battery plant in Arizona scheduled to go online within the next several months as well as a project internationally in India.

These plants will reduce the number of blackouts due to power shortage at peak hours and prevent loss of power generated but not used. When it comes to renewables there’s virtually no carbon dioxide emission or risk of spills harming the environment. Electricity generated from renewables will be stored appropriately and reinforce the notion that our power grid really can go green.

This does not bode well for fossil fuel producers. Combustion plants using fossil fuels see this as an imposing threat to their industry. With 67 percent of our grid currently relying on nonrenewable energy, there could be a sizeable portion of market share up for grabs. The push to reduce climate change has governments betting on these batteries. President Trump, however, has promised to bring coal and crude production to a new level of activity. Economists are unsure how his policy will play out but all this guarantees oil producers is a little more sweet time before this inevitable adaptation. Related: Pipeline Approvals Could Put A Ceiling On Gas Prices

AES has remained steady while Altagas dropped $2.18 per share since the week of their plant’s opening. Even with these losses, investors should consider Altagas as well as AES. The projects show promises of growth but only a fraction of what’s expected of Tesla. The company’s stock has grown nearly $70 since December and analysts don’t see momentum slowing. Tesla’s plant is now online and the gigafactory is to be completed next year. Investors should see strong returns in Tesla’s stocks around these times, especially with a lot riding on the gigafactory’s planned opening.

It’s unlikely crude benchmarks will react towards this news but future plans may prove otherwise. Oil majors are beginning to worry when demand will peak, knowing that cloud may be just over the horizon. Investors shouldn’t concern themselves with an approaching downward trend yet and should continue to ride out the OPEC supply cuts.

By Michael McDonald of Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment
  • JHM on February 12 2017 said:
    Yes, the coming battle is barrels versus batteries. Renewables are just a cheap way to charge batteries. Batteries will flow into the grid and into vehicles. Either way they enable renewables to replace fossil fuels. Indeed, the market will determine the best use for each battery, which will impact marginal fuel prices long before significant volume is displaced.

    But keep this in mind, at steady state, an annual supply of 100 GWh offsets 1 mmb/d of fossil fuels. So the scaling up of Gigafactory 1 in Sparks, NV, to 150 GWh is like an oilfield that will eventually produce 1.5 mmb/d. The full impact of this will take a little over a decade to be felt, but it is huge.

    Batteries change everything. From here out, it's batteries versus barrels.
  • 3725 on February 13 2017 said:
    Michael, can you explain in detail what you meant by these statements. I see no logic connecting the two sentences, just the usual disconnected spin.

    The push to reduce climate change has governments betting on these batteries. President Trump, however, has promised to bring coal and crude production to a new level of activity.

    Thank you.
  • Jeff in Dallas on March 11 2017 said:
    Please quantify the battery storage "boom" happening in 2017.
    One of two things will be true here:
    1. Your estimate is far too high and it won't come close to happening.
    2. You're characterizing a very small amount of battery storage as a "boom" when most observers would call it an "insignificant amount."

    I'm guessing the latter. But please go ahead and quantify this boom so we can test your hypothesis later this year.

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News