Batteries May Replace Some Power Plants

Batteries can be an expensive way to provide power to utility customers, but new research shows they can be an effective way to generate power during high demand for electricity – if their cost continues to fall.

That’s the conclusion of battery company executives who spoke at the Utility of the Future conference in Washington on June 2-4. The sweet spot, they said, is when the price of energy storage can be brought below $300 per kilowatt-hour.

Steve Hellmann, president of Eos Energy Storage, told the conference that as costs continue to come down and the value of battery storage of electricity continues to rise, “there’s no turning back.” In fact, he said, so-called “peaker plants,” designed to handle surges in power demand, will become obsolete within five years.

Peaker plants are expensive and inefficient because they’re used only at peak demand. Batteries, though, can be used much more often, such as to maintain a steady flow of electricity by balancing the supply and demand in the grid.

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For example, Chris Shelton, president of AES Energy Storage, says AES already has installed huge lithium-ion batteries totaling 174 megawatts. This includes a 32-megawatt unit linked to a wind farm that, among other things, helps keep a steady supply of electricity from wind turbines.

These technologies could turn utility practices upside down. Arizona State University (ASU), for example, has been holding workshops on alternative energy, the aim of which isn’t necessarily to threaten existing utilities, but to provide a roadmap for them to follow to operate profitably as energy sources change.

By Andy Tully of OIlprice.com