The technology behind battery storage
Two hundred years ago, Italian physicist Alessandro Volta proved that electricity could be generated chemically. This led others to conduct similar experiments, which eventually resulted in the development of the fields of electrochemistry and electrochemical storage. Today, we're constantly exposed to battery technology through portable electronics, such as laptops, mobile phones, and the good old TV remote.
Batteries have also been widely deployed in large-scale UPS (uninterruptible power supply) systems to secure critical infrastructure and steel the grid against instabilities caused by the integration of renewable sources. Beyond that, battery energy storage systems (BESS) have played an important role in the development of microgrids, typically in places without a reliable electric grid or grid connection. McKinsey predicts that the share of energy consumption from electricity will rise considerably, from 19% to 30% by 2050, with renewable energy sources dominating from 2030 onward. Battery storage technology plays a necessary role in the integration of these renewables.
The installation of a 5MW/1.25MWh battery system in Portland, USA, is often regarded as the first utility-scale (grid-scale) installation in the world. The last decade witnessed a sharp increase in the deployment of large battery storage systems to support the grid in countries around the globe. The biggest battery installed and operating currently is located in California with a rating of 300MW/1200MWh, which shifts excessive solar output from daylight to nighttime. The UK is following suit with the construction of a battery storage project with a 320MW/640MWh lithium-ion battery, and China plans to deliver 21% or 153 GWh of global cumulative battery storage capacity by the end of the decade.
Global storage deployment
However, only a small fraction of total stored energy stems from charged batteries. Energy can be also stored as water at hydroelectric facilities, which still makes up the majority of the total global storage capacity of 170GW. But things are about to change, as renewable energy sources need the flexibility offered by battery storage to meet demands more efficiently. Due to increased production quantities and technical innovations, battery storage prices have fallen sharply in recent times, and are now becoming economically viable.
Source: Wood Mackenzie
BESS charge cycles
The charge cycle of a battery refers to the process of charging a rechargeable battery and discharging it to power a load. The number of cycles is typically used to specify a battery's expected life, as it affects longevity more than the passage of time does. A lithium-ion battery can reach between 5,000-7,000 full charging cycles. Each battery is affected differently by charge cycles, but the rule of thumb is that the number of cycles for a rechargeable battery indicates how often it can be fully charged and discharged before it fails or its capacity deteriorates faster.
Batteries can store energy for a certain time without any significant capacity losses, but they start losing capacity when cycled once or multiple times a day. Degradation is the key factor that determines the economic viability of battery assets, with some battery technologies more dependent on the cycle profile than others. Lithium-ion is the dominant BESS technology, despite being heavily dependent on the cycle profile. This must be carefully considered when setting up the business model and the project calculation. Even a slight deviation from the planned cycle profile may lead to earlier degradation and can turn the whole business model unviable. A thorough discussion of warranty conditions is mandatory to avoid unpleasant surprises and sophisticated model validation is recommended.
The lithium-ion battery
Today, the overwhelming part of battery installations are made from lithium-ion technology without any real contenders in sight. What sets those batteries apart from other types is that they can be charged and discharged frequently and have a relatively high depth of discharge. In addition, they are comparatively light and come in a small package size due to their high energy density. The high efficiency makes lithium-ion batteries costlier to produce, but this is offset by their longer service life. Despite the inherent risk of overhearting from overcharging, lithium-ion batteries are used in most storage systems because of their superior durability and efficiency. Technical advances and increases in production capacity have led to falling manufacturing costs, which facilitates further development in stationary and mobile power supply.
Utility-size battery systems
Batteries are usually installed near a power plant, transmission station, commercial, or residential building to fullfil a specific function. Small battery systems, sometimes referred to as household batteries, typically supply residential homes, where they are deployed alongside a home PV setup. However, systems of up to 1 MW can also be found in some industrial and commercial appliances.
Battery storage systems of over 2 MW are typically front-of-the meter (FTM) assets connected to the distribution network and moving upstream, while systems of 10 MW and up are connected directly to the transmission network. Vital for frequency and voltage control, the biggest battery systems with over 50 MW are often deployed near power plants. Utility-scale systems are essential for widespread grid stability known to generate high returns when utilized for power trading across all available markets.
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