New energy storage technologies are surging into the market, as business leaders and policymakers seek to address climate change, support renewable energy, and create a more reliable and resilient grid. However, not all energy storage solutions are the same. The global economy faces multiple challenges in addition to climate change. To foster long-term sustainability at a holistic level, energy storage should support reliability and security while benefitting people and the planet, including historically disadvantaged communities.
The technology behind wind turbines and solar panels are now more efficient and economically competitive than ever before, but nothing can change the essential nature of wind and solar power. Wind speeds vary by hour, day and season. Sunlight is absent all night, and cloudy weather can cut into solar panel performance during the day.
That’s where energy storage comes into play. Batteries can store enough electricity to fill the gaps when the output from wind turbines and solar panels shrinks.
Why is long duration energy storage important?
Long-duration energy storage is a critical feature of the Energy Department’s plans for integrating more wind and solar onto the grid without sacrificing reliability and stability. Having recognized the four-hour limitation of conventional lithium-ion technology, the Energy Department defines long-duration energy storage as a device or system that can generate electricity for at least 10 hours, and preferably for multiple days lasting 100 hours or more. In addition, the environmental and social impacts of over-reliance on lithium technology are beginning to come into view, and the picture is not pretty.
While the U.S. has large deposits of lithium to exploit, fossil energy stakeholders are among those pointing out that the local environmental impacts of lithium extraction and refining share characteristics with the impacts of coal, oil and gas operations.
Along with environmental and public health impacts, lithium mining can raise significant social, cultural and human rights issues. In the U.S., most lithium reserves are concentrated in western states, where the once-dormant domestic lithium mining industry has become a hotbed of activity, triggering new concerns over water resources and the use of public lands.
What is the long duration energy storage costs?
One key benefit of LDES is that it entails low marginal costs for storing electricity. It enables the decoupling of the quantity of electricity stored and the speed with which it is taken in (charged) or released (discharged), it is widely deployable and scalable. This makes it competitive with other forms of energy storage such as lithium-ion batteries, dispatchable hydrogen assets, and pumped-storage hydropower, and economically preferable to expensive and protracted grid upgrades.
Indeed, the evidence shows that in many applications, it is likely to be the most cost-competitive solution for energy storage beyond a duration of six to eight hours.
As a result, while novel LDES technologies are still nascent, deployment could accelerate rapidly in the next few years. A key milestone for LDES is reached when renewable energy reaches 60 to 70% market share in bulk power systems, which many countries with high climate ambitions aim to reach between 2025 and 2035. This would likely include the United Kingdom, the United States, and many other developed countries which have made net-zero commitments prior to the COP26 Climate Change Conference.
Long duration energy storage companies
Here are some companies that are revolutionizing the market:
Energy Vault
Energy Vault announced $100 million in Series C funding, led by Prime Movers Lab alongside Saudi Aramco and Softbank Vision Fund. Following that news, Energy Vault announced a special purpose acquisition company (SPAC) with Novus Capital II in a deal that landed the energy storage venture on the New York Stock Exchange. The pro-forma enterprise value of the combined company is $1.1 billion, according to a press release.
The technology: gravity-based, grid-scale energy storage. The system uses excess renewable energy to raise bricks, then lowers the bricks to generate energy during peak demand — all controlled by AI software and executed autonomously.
Value proposition: An energy storage system that is cost-efficient, reliable, safe to operate and environmentally sustainable over a 35-year technical life.
Deployment status: Energy Vault says it has eight projects in the pipeline for a total of 1.2 gigawatt-hours of energy storage capacity, with deployments planned for the U.S., Europe, Middle East and Australia.
FlexGen Power Systems
FlexGen Power Systems announced a $150 million equity commitment from funds managed by Apollo Global Management.
The technology: FlexGen promises grid-scale and microgrid energy storage, integrated with energy management software. The company got its start in 2009 providing energy storage to the military.
The value proposition: Integrated software to reach “peak asset performance.” The company sees the value of energy storage as the connection between the hardware and software to optimize performance.
Deployment status: The company has more than 20 utility-scale energy storage projects listed on its website, primarily in Texas, which provides load shifting and ancillary services.
EnerVenue
EnerVenue announced a $100 million in Series A funding — a monster round for such an early-stage venture. Schlumberger New Energy led the investment, accompanied by Saudi Aramco Energy Ventures and others.
The technology: Nickel-hydrogen batteries, which can operate in extreme heat and cold and are currently less expensive than lithium-ion cells. Nickel hydrogen is also heavier than lithium-ion, making it less ideal for electric vehicles, though potentially a good option for grid-scale storage.
Value proposition: The company promises an energy storage solution with low upfront and operational costs that is long-lasting and flexible. It got its start with NASA, powering the International Space Station and Hubble Space Telescope, which the company points to as evidence of the technology’s ability to perform in extreme conditions.
Malta
Malta Inc announced it raised $60 million in Series B financing, backed by Chevron Technology Ventures and Piva Capital have joined Proman, Alfa Laval, Breakthrough Energy Ventures and Dustin Moskovitz, a Facebook co-founder.
The technology: Malta uses an electro-thermal technology that it calls a pumped heat energy storage system, developed out of X, the Moonshot Factory (formerly Google X). It works by converting electrical energy into thermal energy, storing the heat in molten salt and cold in chilled liquid. It then uses a heat engine, powered by the temperature differential, back to electricity.
Value proposition: The technology boasts a long-duration, grid-scale, cost-effective energy storage technology. The company says it can efficiently store up to 200 hours of energy. Malta says the technology can also be used to generate heat for industrial heat applications.
Form Energy
Form Energy, a four-year-old company founded by a former Tesla employee, closed $240 million in Series D financing Aug. 24, with investors including steel company ArcelorMittal.
The technology: Form uses an iron-air battery, which converts iron to rust, then rust back into iron, discharging and charging the battery in the process. The company says that its battery can store electricity for 100 hours at system costs competitive with legacy power plants.
The context: Form Energy made headlines in July when it announced its long-duration battery should be ready for mass production by 2025 — at a fraction of the price of other energy storage systems. While other companies have made similar promises, Form Energy says this time is different. “We’re the alumni of a generation of failed battery companies who all came back for more,” Yet-Ming Chiang, one of the company’s co-founders, told the Wall Street Journal.
The value proposition: A cheap, long-duration energy storage source that is on the verge of commercialization. Form estimates it will spend less than $6 per kilowatt-hour of storage, compared to $50 to $80 per kWh of nickel, cobalt, lithium or manganese minerals.
Conclusion
The benefits to society of large-scale LDES deployment as solar PV and wind become the dominant sources of power are obvious and the alternatives are costlier failing to invest in system flexibility as the renewable share of the power mix grows would be a recipe for major instability in the electricity supply.
Furthermore, all the evidence suggests that this could be a highly attractive market for investors as a sizeable new industry providing 1.5 to 2.5 TW of storage capacity, requiring an investment that could reach $1 trillion to $3 trillion by 2040 with potential competitive returns. The prize is within reach, and the time to seize it is now.