Li-ion Energy Storage for Dummies (Part 2)
Energy storage is booming. Here’s your dummies guide on how grid storage batteries are changing the landscape of renewable energy, by our contributor Kush.
In part 2 we’ll be covering:
Oversize vs augmentation.
Governing standards.
Bloomber’s tier 1 list.
Texas vs California, the race to be number 1.
The BESS Failure Event Database.
The future for energy storage.
Oversize vs Augmentation
Remember we said in part 1 that storage projects are now being designed for up to 25 years of lifetime? With battery degradation, this means that storage project owners are losing capacity for every year of operation. To counter this we can use two strategies, oversizing the system at the beginning of life, or by using augmentation. Augmentation means adding in new batteries and inverters during the project lifetime to ‘bump up’ the capacity above the minimum capacity required for the project.
The below chart shows a comparison between the capacity profile for an overbuilt project vs that of an augmented one. This project has a requirement to maintain 750MWh throughout the 25 year lifetime. The profiles are made up, but you get the idea. The augmented profile has new batteries and inverters being added in the 7th, 14th and 21st years.
Augmentation offers a few benefits over oversizing:
Lower overall system cost. With oversizing, all the batteries installed at the start are degrading over the life of the project. With augmentation you’re adding in new batteries to boost capacity only when needed. With declining battery prices, batteries bought at a later point in time can also be cheaper.
Utilization of new technology. New batteries and PCS’ may come out in future years and so with augmentation you can take advantage of the latest technology on the market.
However, there are also drawbacks:
You may need to shutdown parts of your site during installation of the augmented batteries, which means lost revenue.
You need to keep space available on your project site for the planned batteries. And have all the cabling and trenches ready to go when the batteries need to be installed.
Even within augmentation there are two strategies; DC augmentation (adding in new batteries behind already operational PCSs) and AC augmentation (adding in new batteries and new PCSs). AC augmentation is usually simpler to implement as mixing new and old batteries behind a PCS (as with DC augmentation) can bring issues with voltage and SOC imbalances.
Governing Standards
There’s a lot of standards in the US governing energy storage. The main ones are:
NFPA855 provides mandatory safety strategies and features of BESS systems. It also has best practices for preventing explosions and containing fires. NFPA855 also requires BESS systems to be listed in accordance with UL9540.
UL9540 outlines design, construction and performance requirements for BESS systems.
UL9540A is a set of standards regarding thermal runaway that an energy storage system must meet. There’s several layers to it. Cell level testing characterizes the cell design, gas composition on thermal runaway and temperature/burning characteristics. Module level testing aims to see if the module will contain a cell thermal runaway and if cell to cell propagation occurs. Container level testing assesses the entire BESS design to see if it contains a thermal runaway and doesn’t explode.
Bloomberg tier 1
With so many battery suppliers entering the energy storage market, it’s sometimes hard to know who’s legit and who isn’t. To help differentiate between the many manufacturers on the market, BloombergNEF developed a tier 1 list. This is a list of the most ‘bankable’ manufacturers, i.e those companies in which investors and lenders have the most confidence and trust. When you’re spending hundreds of millions of dollars on batteries, you need to make sure the manufacturer can deliver the goods. The list is not publicly available, only via a bloomberg subscription, but this link contains some information on the criteria.
Cell manufacturers and system integrators can both make it onto the list but their are some criteria they must meet. In order to be on the tier 1 list, the company:
Must own their own manufacturing plants.
Must have supplied, or be firmly contracted to supply, products to six different eligible projects in the last two years. To be eligible, each project:
Must be larger than 1MW or 1MWh (whichever is higher);
Must be owned by companies that are not affiliated with the energy storage provider (in other words, the purchaser of the energy storage system must be a third party); and cannot be built to meet renewable energy project integration mandates (such as those in place in many Chinese provinces), as these mandates do not typically place a strong emphasis on the performance of the system.
All projects considered must be in the BNEF Energy Storage Assets database.
Texas vs California
There’s no doubt that in the US, Texas and California are the biggest markets for energy storage. California has historically been the leader for clean energy but Texas is fast approaching.
According to this article by Canary Media, 6.4GW are set to be added in Texas this year (as much power capacity as the entire US built last year) whilst 5.2GW are set to be added in California. California has been attractive for storage projects thanks to favorable policy and subsidies, whereas Texas is attractive thanks to competitive wholesale electricity markets. California mandated utilities to acquire energy storage and allocated funding for households and businesses that wanted to buy batteries. Texas doesn’t award contracts to ensure sufficient grid capacity, but price spikes from electricity scarcity are meant to incentivize private developers to build storage and make money. Obtaining land and permits is also easier in Texas than California.
People usually associate the blue states to be leading the way on clean energy, but with the speed at which Texas is adding new energy storage sites, this may not last for long.
BESS Failure Event Database
As we know, batteries can be dangerous if operated or designed incorrectly. The BESS Failure Event Database is a site which uses publicly available data to document battery storage system failures around the globe. It includes info on the location and size of the project, as well as the source for the information. This can be used to collect data on the reasons for battery failures and as an input to improving safety efforts. Check it out here.
A bright future for storage
Energy storage is moving at a rapid pace and projects are being built so fast across the US that it’s hard to keep track. With battery prices falling and a push towards clean energy, it seems there is no stopping the installation of large scale grid storage, especially when there’s so much money to be made. There are concerns in the industry however that a change in government administration may see tariffs imposed on batteries imported from China.
With almost all of the world’s storage batteries coming from China, this has the potential to be a big roadblock for storage projects. Battery companies are increasingly trying to build domestic production to alleviate the concerns of tariffs, as well as to provide some comfort to customers who want to use US made batteries. Some project owners are even pushing future orders forward to avoid potential future tariffs. Whatever happens, it seems there will be no stopping the freight train that is energy storage.
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