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Energy storage in Spain

Spain’s Energy Landscape

In our previous post we reported on the prospects of energy storage in Denmark. Now we are moving back south. While it is commonly assumed that solar is the key driver of renewable energy production in Spain, wind represents more than three times the energy production than solar − Spain is a world leader in wind power. In 2014, Spain had the 4th most installed wind capacity, globally and wind energy accounted for 18% of total Spanish electricity production in 2015. Gas and coal still make up over one-third of electricity production in Spain.

Electricity Production in Spain (Source: International Energy Agency, 2015)

While fuel oil is still used for electricity in Spain, it should be noted that this is exclusive to the non-peninsular areas of Spain (i.e. Canary Islands, Balearic Islands, Cueta, Melilla, and several other small islands).

By 2020, 20% of Spain’s final energy consumption must come from renewable energy sources – as mandated in the 2009 EU Directive 28. However, Spain will likely miss this target. In the early 2000’s Spain was a global leader in renewable energy. For example, in 2005 Spain became the first country to mandate PV installations on all new buildings and ranked 5th globally in total renewable energy investments. However the renewable energy industry has stagnated significantly over the past decade. Unfortunately, Spain, which drove the global market in 2008, has virtually disappeared from the PV picture due to retroactive policy changes and new tax on self-consumption.

The policy changes and self-consumption taxes allude to the Royal Decree 900/2015 on self-consumption, a law enacted by the Spanish government in October 2015, which aims to financially penalize the self-consumption of electricity. Under the new law solar PV producers (residential PV owners, for example) are required to not only pay a tax on the energy they self-consume, but also must pay the same transmission & distribution fees they would have paid on an equivalent amount of electricity purchased from the grid. In addition to these charges and taxes, owners of systems 100 kW and smaller – most residential system owners – are prohibited from selling excess electricity from the grid. Instead, they must give it to the grid for free. Furthermore, this law is retroactive; meaning existing PV systems must comply or face a penalty. Penalties under the self-consumption law range from as low as EUR 6-million up to a maximum of EUR 60-million – about twice the fine for leaking radioactive waste. The Spanish government see’s self-consumption as a risk to tax revenues at the current high electricity prices.

Spain is still the world leader in concentrated solar power capacity (2.5 MW). However, no new plants were constructed since and there are currently no new plants under construction or in planning.

Energy Storage Market Outlook – Spain

Although initial drafts of the “self-consumption” law had strict provisions against battery storage systems, the final version does permit energy storage systems – although under conditions that make them impractical. While owners of solar-plus-storage systems are subject to additional charges, they also cannot reduce the amount of power that they have under contract from their utility company.
At this point in time, it appears as if the self-consumption law has effectively halted any investment in renewable energy and/or energy storage projects in Spain.

(Jon Martin, 2019; Photo: Wikipedia)

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Energy storage in Denmark

Denmark’s Electricity Portfolio

In our last post of our blog series about energy storage in Europe we focused on Italy. Now we move back north, to Denmark. Unsurprisingly, Denmark is known as a pioneer of wind energy. Relying almost exclusively on imported oil for its energy needs in the 1970s, renewable energy has grown to make up over half of electricity generated in the country. Denmark is targeting 100 percent renewable electricity by 2035, and 100 percent renewable energy in all sectors by 2050.

Electricity Production in Denmark (2016)

Proximity to both Scandinavia and mainland Europe makes exporting and importing power rather easy for the Danish system operator, Energinet.dk. This provides Denmark with the flexibility needed to achieve significant penetration of intermittent energy sources like wind while maintaining grid stability.

While the results to-date have been promising, getting to 100 percent renewable energy will still require a significant leap and the official policies that Denmark will use to guide this transition have yet to be delivered. However, there has been some indication at what the ultimate policies may look like. In their report Energy Scenarios for 2020, 2035 and 2050, the Danish Energy Agency outlined four different scenarios for becoming fossil-free by 2050 while meeting the 100 percent renewable electricity target of 2035. The scenarios, which are primarily built around deployment of wind energy or biomass, are:

  • Wind Scenario – wind as the primary energy source, along with solar PV, and combined heat and power. Massive electrification of the heat and transportation sectors.
  • Biomass Scenario – less wind deployment that in the wind scenario, with combined heat and power providing electricity and district heating. Transportation based on biofuels.
  • Bio+ Scenario – existing coal and gas generation replaced with bioenergy, 50% of electricity from wind. Heat from biomass and electricity (heat pumps).
  • Hydrogen Scenario – electricity from wind used to produce hydrogen through electrolysis. Hydrogen used as renewable energy storage medium, as well as  transportation fuel. Hydrogen scenario would require massive electrification of heat and transport sectors, while requiring wind deployment at faster rate than the wind scenario.

Agora Energiewende and DTU Management Engineering, have postulated that this scenario report does in fact show that transitioning the Danish energy sector to 100 percent renewables by 2050 is technically feasible under multiple pathways. However, Danish policy makers must decide before 2020 whether the energy system will evolve into a fuel-based biomass system, or electricity-based wind energy system (they must decided which of the four scenarios to pursue).

Energy Storage Facilities – Denmark

Regardless of which energy policy scenario Denmark decides to pursue, energy storage will be a central aspect of a successful energy transition. There are currently three EES facilities operating in Denmark, all of which are electro-chemical (batteries). A fourth EES facility – the HyBalance project – is currently under construction and will convert electricity produced by wind turbines to hydrogen through PEM electrolysis (proton exchange membrane).

Project Name

Technology Type

Capacity (kW)

Discharge (hrs)

Status

Service Use

RISO Syslab Redox Flow Battery Electro-chemical Flow Battery 15 8 Operational Renewables Capacity Firming
Vestas Lem Kær ESS Demo 1.2 MW Electro-chemical Lithium-ion Battery 1,200 0.25 Operational Frequency Regulation
Vestas Lem Kær ESS Demo 400 kW Electro-chemical Lithium-ion Battery 400 0.25 Operational Frequency Regulation
HyBalance Hydrogen Storage Hydrogen Power-to-Gas 1,250 Operational Renewables integration
BioCat Power-to-Gas Methane Storage Methane Power-to-Gas 1,000 Decommissioned Gas Grid Injection & Frequency Regulation

The HyBalance project is the pilot plant undertaking of Power2Hydrogen, a working group comprised of major industry players and academic research institutions aimed at demonstrating the large-scale potential for hydrogen from wind energy. The plant will produce up to 500 kg/day of hydrogen, used for transportation and grid balancing.

Worth noting is the decommissioned BioCat Power-to-Gas project, a pilot plant project which operated from 2014 to 2016 in Hvidovre, Denmark. The project, a joint collaboration between Electrochaea and several industry partners (funded by Energienet.dk), was a 1 MWe Power-to-Gas (methane) facility built to demonstrate the commercial capabilities of methane power-to-gas. The BioCat project was part of Electrochaea’s goal of reaching commercialization in late 2016, however, as of early 2017 no further updates have been given.

Energy Storage Market Outlook − Denmark

The energy storage market in Denmark will be most primed for growth should policy follow the Hydrogen Scenario, where massive amounts of hydrogen production will be needed to eliminate the use of fossil fuels across all sectors.

Renewable energy produced gases (hydrogen, methane) have the potential to balance the electricity grid in two primary ways: balancing supply and demand (“smart grid”), and balancing through physical storage. The smart grid, an intelligent electricity grid where production and consumption are administered centrally, presents significant opportunity for electrolysis technologies as short-term “buffer” storage (seconds to minutes). Bulk physical storage of renewable energy produced gases can act as a longer-term storage solution (hours, days, weeks, months) to help maintain flexibility in a fossil-free energy grid (The Danish Partnership for Hydrogen and Fuel Cells).

Without the hydrogen scenario, the potential for hydrogen-based energy storage in Denmark will be limited. In their 2016 report “potential of hydrogen in energy systems”, the Power2Hydrogen working group concluded that:

  • hydrogen electrolysers would not provide any significant upgrade on flexibility for renewables integration over today’s sufficiently flexible system, and;
  • by 2035, with the increased wind production, it was concluded that hydrogen electrolysers would in fact improve system flexibility, allowing for even more extensive penetration of wind energy in the system.

The potential for renewable energy produced gases in Demark is extremely high. There is a very distinct possibility that power-to-gas type of systems will be the linchpin of Denmark’s energy transition. While there appears to be little opportunity in the short-term, there will be extensive opportunity in the medium-to-long-term should the official energy transition policy focus on the hydrogen scenario, or a similar renewable gas based policy.

Read here our next post on the prospects for energy storage in Spain.

(Jon Martin, 2019)

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Future challenges for wind energy

Many people believe that there is no need for improvement because wind turbines have been working for decades. Wind energy has the potential to be one of the world’s cheapest energy sources. In a recent article in the Science magazine, major challenges have been addressed to drive innovation in wind energy. Essentially three directions were identified:

  1. The better use of wind currents
  2. Structural and system dynamics of wind turbines
  3. Grid reliability of wind power

In order to make better use of wind currents, the air mass dynamics and its interactions with land and turbines must be understood. Our knowledge of wind currents in complex terrain and under different atmospheric conditions is very limited. We have to model these conditions more precisely so that the operation of large wind turbines becomes more productive and cheaper.

To gain more energy, wind turbines have grown in size. For example, when wind turbines share larger size areas with other wind turbines, the flow changes increasingly.

As the height of wind turbines increases, we need to understand the dynamics of the wind at these heights. The use of simplified physical models has allowed wind turbines to be installed and their performance to be predicted across a variety of terrain types. The next challenge is to model these different conditions so that wind turbines are optimized in order to be inexpensive and controllable, and installed in the right place.

The second essential direction is better understanding and research of the wind turbine structure and system dynamics . Today, wind turbines are the largest flexible, rotating machines in the world. The bucket lengths routinely exceed 80 meters. Their towers protrude well over 100 meters. To illustrate this, three Airbus A380s can fit in the area of ​​one wind turbine. In order to work under increasing structural loads, these systems are getting bigger and heavier which requires new materials and manufacturing processes. This is necessary due to the fact that scalability, transport, structural integrity and recycling of the used materials reach their limits.

In addition, the interface between turbine and atmospheric dynamics raises several important research questions. Many simplified assumptions on which previous wind turbines are based, no longer apply. The challenge is not only to understand the atmosphere, but also to find out which factors are decisive for the efficiency of power generation as well as for the structural security.

Our current power grid as third essential direction is not designed for the operation of large additional wind resources. Therefore, the gird will need has to be fundamentally different then as today. A high increase in variable wind and solar power is expected. In order to maintain functional, efficient and reliable network, these power generators must be predictable and controllable. Renewable electricity generators must also be able to provide not only electricity but also stabilizing grid services. The path to the future requires integrated systems research at the interfaces between atmospheric physics, wind turbine dynamics, plant control and network operation. This also includes new energy storage solutions such as power-to-gas.

Wind turbines and their electricity storage can provide important network services such as frequency control, ramp control and voltage regulation. Innovative control could use the properties of wind turbines to optimize the energy production of the system and at the same time provide these essential services. For example, modern data processing technologies can deliver large amounts of data for sensors, which can be then applied to the entire system. This can improve energy recording, which in return can significantly reduce operating costs. The path to realize these demands requires extensive research at the interfaces of atmospheric flow modeling, individual turbine dynamics and wind turbine control with the operation of larger electrical systems.

Advances in science are essential to drive innovation, cut costs and achieve smooth integration into the power grid. In addition, environmental factors must also be taken into account when expanding wind energy. In order to be successful, the expansion of wind energy use must be done responsibly in order to minimize the destruction of the landscape. Investments in science and interdisciplinary research in these areas will certainly help to find acceptable solutions for everyone involved.

Such projects include studies that characterize and understand the effects of the wind on wildlife. Scientific research, which enables innovations and the development of inexpensive technologies to investigate the effects of wild animals on wind turbines on the land and off the coast, is currently being intensively pursued. To do this, it must be understood how wind energy can be placed in such a way that the local effects are minimized and at the same time there is an economic benefit for the affected communities.

These major challenges in wind research complement each other. The characterization of the operating zone of wind turbines in the atmosphere will be of crucial importance for the development of the next generation of even larger, more economical wind turbines. Understanding both, the dynamic control of the plants and the prediction of the type of atmospheric inflow enable better control.

As an innovative company, Frontis Energy supports the transition to CO2-neutral energy generation.

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Turbocharged lithium batteries at high temperatures

One of the biggest hurdles for the electrification of road traffic is the long charging time for lithium batteries in electric vehicles. A recent research report has now shown that charging time can be reduced to 10 minutes while the battery is being heated.

A lithium battery can power a 320-kilometer trip after only 10 minutes of charging − provided that its temperature is higher than 60 °C while charging.

Lithium batteries that use lithium ions to generate electricity are slowly charged at room temperature. It takes more than three hours to charge, as opposed to three minutes to tank a car.

A critical barrier to rapid charging is the lithium plating, which normally occurs at high charging rates and drastically affects the life and safety of the batteries. Researchers at Pennsylvania State University in University Park are introducing an asymmetrical temperature modulation method that charges a lithium battery at an elevated temperature of 60 °C.

High-speed charging typically encourages lithium to coat one of the battery electrodes (lithium plating). This will block the flow of energy and eventually make the battery unusable. To prevent lithium deposits on the anodes, the researchers limited the exposure time at 60 °C to only ~10 minutes per cycle.

The researchers used industrially available materials and minimized the capacity loss at 500 cycles to 20%. A battery charged at room temperature could only be charged quickly for 60 cycles before its electrode was plated.

The asymmetrical temperature between charging and discharging opens up a new way to improve the ion transport during charging and at the same time achieve a long service life.

For many decades it was generally believed that lithium batteries should not be operated at high temperatures due to accelerated material degradation. Contrary to this conventional wisdom, the researchers introduced a rapid charging process that charges a cell at 60 °C and discharges the cell at a cool temperature. In addition, charging at 60 °C reduces the battery cooling requirement by more than 12 times.

In battery applications, the discharge profiles depend on the end user, while the charging protocol is determined by the manufacturer and can therefore be specially designed and controlled. The quick-charging process presented here opens up a new way of designing electrochemical energy systems that can achieve high performance and a long service life at the same time.

At Frontis Energy we also think that the new simple charging process is a promising method. We are looking forward to the market launch of this new rapid charging method.

(Photo: iStock)

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Energy storage in Italy

Italy’s Electricity Portfolio

In our previous post we briefed you on the energy storage potential in the United Kingdom. With Brexit, Italy will become the third largest member state after Germany and France. With extensive mountain terrain in the north, Italy has long been dependent upon hydroelectric generation. Until the mid 1960s hydropower represented nearly all electricity production in Italy. The installed capacity of hydropower has been stagnant since the mid 1960s, with a rapid growth in fossil fuel based generation driving the overall share of hydropower fall from ~90% to 22% in 2014. A detailed breakdown of electricity sources in Italy is shown below.

Electricity Production in Italy (2014)

Considerable effort has been made to transition Italy to a low carbon electricity sector. As of 2016, Italy had the 5th highest installed solar capacity in the world and the 2nd highest per capita solar capacity, behind only Germany. In addition to its impressive solar progress Italy ranks 6th worldwide in geothermal with 0.9 GW.

Italy’s solar growth was propelled by feed-in-tariffs that wer enacted in 2005. This provided residential PV owners with financial compensation for energy sold to the grid. However, the feed-in-tariff program ceased on 06 July 2014 after the €6.7 billion subsidy limit was reached.

Even with its impressive accomplishments in renewable energy, traditional thermal generation (natural gas) still account for ~60% of total electricity generation in Italy. How much effort will go into reducing this number is still unclear. Italy has committed to 18% renewables by 2020 and is nearly 70% of the way there already so there is little urgency on reducing fossil-based electricity from the perspective of meeting this target. However, Italy is heavily reliant on fossil fuel imports (Deloitte) and energy security requirements will likely continue to push the development of more domestic electricity sources like renewables.

Energy Storage Facilities

Italy is dominating the electro-chemical energy storage market in Europe. With over 6,000 GWh of planned and installed electro-chemical generating capacity (~84 MW installed capacity), Italy is far ahead of 2nd place UK. This is largely due to the massive SNAC project by TERNA (Italy’s TSO), a sodium-ion battery installation totaling nearly 35 MW over three phases. A breakdown of energy storage projects, by technology type can be seen below.

Energy Storage Projects by Type (Sandia National Laboratories)

Service Uses of Energy Storage

In Italy, electrical energy storage is used almost exclusively for grid support functions; mainly transmission congestion relief (frequency regulation). While it may not be a direct case of renewables firming, congestion issues can be traced to the variability of solar power, meaning electrical energy storage development in Italy is largely driven by the need to integrate solar power.

Energy Storage by Service Use Type (Sandia National Laboratories)

Energy Storage Market Outlook

Italy is one of the top markets in the EU for energy storage and is primed for growth. The Italian TSO, TERNA, has been investigating selling energy storage as a service. In 2014 the AEEG, the electrical regulator under which TERNA operates, proposed that batteries should be treated as generation sources similar to cogeneration plants. Italy has always been a market completely dominated by a small number of big centralized utility companies and this trend is likely to continue when it comes to EES deployment. These companies have been focusing their efforts on battery technologies and are expected to continue down this path.

However, the private market could present great opportunity for P2G. The International Battery & Energy Storage Alliance have summarized the reality of Italy’s untapped energy storage market as follows: “With high solar output of 1,400 kWh/kWp, net residential electricity prices around 23 cent/kWh and currently no FIT, the Italian energy market is considered to be highly receptive for energy storage.”

Italy is now well-stocked with residential PV systems that can no longer collect subsidies. Combine this with the fact that the vast majority of homes in Italy burn natural gas imported from Russia, Libya and Algeria and it is clear that Italy presents a unique opportunity for P2G at a residential/community level. This is echoed by Energy Storage Update who in 2015 concluded that Italy was “one of the top four markets worldwide for PV-and-battery-based energy self-consumption.”

While it is unclear exactly how many residential PV systems there are in Italy, it was speculated in late 2015 that there were over 500,000 PV plants in Italy.

In our next post, we are looking at the situation for energy storage in Denmark.

(Jon Martin, 2019)

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Energy storage market in the United Kingdom

The UK’s Electricity Portfolio

In our last post about the EU energy storage market we gave a brief overview of Germany’s situation. Now, we show how the United Kingdom prepared itself for its energy transition. Traditionally, the UK’s energy mix has been dominated by fossil fuels. This remains the status quo today, as approximately 60% of the electricity generated in the UK comes from fossil fuel sources, with another 20% coming from nuclear.

UK electricity production 2015 (Source: The UK Government)

While the UK has been heavily dependent on carbon-intensive sources of electricity, in 2008 they committed to a 15% renewable energy target (by 2020) and 80% reduction in CO2 emissions (by 2050; Department of Energy & Climate Change). However, the UK has stated that they will miss the 15% renewable target for 2020, due to the lack of properly designed policy measures. There has been considerable pressure to transition to a low carbon market and with one-quarter of existing generating capacity (mainly coal and nuclear) expected to close by 2021; it is expected that growth in renewable energy will lead to more energy storage capacities.

In 2011 the UK government, acknowledging that their current market structure would not be able to accommodate the scale or rate of investment in clean energy needed, proposed a shift to a capacity-based market, that is, a market in which a central agency procures capacity years in advance, in order to adequately plan for and control future generation. The proposed market reform would help drive the transition to low carbon energy by providing renewable energy producers revenue stability through carbon pricing and feed-in-tariffs (FITs). The capacity market was operational after the first energy auctions in late 2015.

The UK has made excellent progress on its short-term clean energy goals and there is optimism that this trend will continue. Large-scale development of low carbon generation technologies such as wind and solar is expected to continue.

Energy Storage Facilities

As of late 2016, there were 27 non-PHS EES plants representing 430 MW of installed capacity in the UK (Sandia National Laboratories). The UK’s energy storage portfolio is dominated by electro-chemical based technologies (primarily lead-acid and lithium-ion battery installations). This is shown below.

Number of Existing & Planned Energy Storage Facilities in the UK, by Type (Source: Sandia National Laboratories)

The prevalence of electro-chemical technologies appears to be continuing the short-term as well; five of the seven energy storage projects currently under development in the UK are electro-chemical. While this is a rather small sample size, the decreasing costs of lithium-ion battery storage is a point of focus for the UK.

Service Uses of Energy Storage

UK Energy Storage Facilities by Service Use Type (Source: Sandia National Laboratories)

As was shown for Germany, only a very small fraction of EES facilities are dedicated to renewables capacity firming. The existing EES capacity is almost exclusively dedicated to critical transmission support (on-site power). While nearly all of the EES capacity under development is dedicated to bulk energy storage (electric energy time shift).

There is still considerable uncertainty around the growth of EES in the UK, and with such a small sample size it is difficult to infer any correlation from the data in the figure above. According to the previous UK government, however, being geographically isolated and a net importer of electricity, one would expect the UK to place a heavier focus on renewables capacity firming in the long-term.

Energy Storage Market Outlook

The UK is in the midst of a major restructuring of their electricity generating portfolio and the market under which these assets operate. With a large portion of the existing capacity due for retirement in the next 10-15 years, the UK faces challenges in meeting energy needs while balancing decarbonization efforts. As part of this, major investment is needed in all areas of the electrical grid, including energy storage.

In its Smart Power publication, the National Infrastructure Commission outlined that while the UK is being faced with challenges to cover aging infrastructure this represents an opportunity to build efficient and flexible energy infrastructure. The Commission stated that energy storage was one of the three key innovations for a “smart power revolution”.

Many other official government bodies have expressed similar thoughts regarding energy storage. In its Low carbon network infrastructure report, the Energy and Climate Change Committee stated that “storage technologies should be deployed at scale as soon as possible”, while urging the Government to eliminate the outdated and unfair regulations that have been handcuffing energy storage development in the UK (Garton and Grimwood).

In April 2016, the Government acknowledged concerns regarding the regulatory hurdles facing energy storage projects (primarily double-charging of network charges) and stated that they would begin working with the National Infrastructure Commission and ECCC to investigate the issue. While there may be regulatory hurdles hindering energy storage in the UK, the Government has shown commitment through funding. Since 2012, the government has contributed over £80 million to energy storage research. In addition to this, the Department of Energy and Climate Change have developed a new £20 million fund to help drive innovation in energy storage technologies.

Overall, the outlook for energy storage in the UK is positive. There is considerable pressure to begin developing energy storage facilities at scale from not only industry, but also many government bodies. Investors are ready as well. As stated by the National Infrastructure Commission: “businesses are already queuing up to invest”.

Simply put: regulatory hurdles are holding back growth in the UK energy storage market. With the Government making major strides in renewable energy development and being vocal about its commitment to making the UK a leader in energy storage technology, these regulatory hurdles will likely be relaxed and there should be considerable growth in the UK energy storage market in the near-term.

At this point, specific technology types and service uses have not been hypothesized in detail. However, with the UK being geographically isolated and a net importer of electricity, logic would suggest an emphasis on renewables capacity firming in the long-term to maximize domestic consumption of renewable energy. Rapidly decreasing costs in electro-chemical technologies, coupled with the fact that much of the existing gas-fired capacity will be reaching end of life by 2030 suggest that the UK EES market would not be ideal for P2G technologies.

In our next post, we focus on Italy.

(Jon Martin, 2019)

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Energy storage market in Germany

Germany’s electricity portfolio

In our last posts we introduced electrical energy storage (EES) and the EU market for EES. Now, we focus on some important EU members, beginning with Germany. The country’s electrical energy portfolio reflects its status among the most progressive countries in the world in terms of climate action. As of November 2016, Germany had produced ~35% of its 2016 electricity needs from renewable sources as outlined in the Figure below.

Electricity Production in Germany (Source: Fraunhofer ISE)

The growth of renewable energy has been driven by Germany’s strong energy transition policy – the “Energiewende” – a long-term plan to decarbonize the energy sector. The policy was enacted in late 2010 with ambitious GHG reduction and renewable energy targets for 2050 (80-95% reduction on 1990 GHG levels and 80% renewable-based electricity).
A major part of the 2010 Energiewende policy was the reliance on Germany’s 17 nuclear power plants as a “shoulder fuel” to help facilitate the transition from fossil fuels to renewables. In light of the Fukushima disaster just six months after the enactment of the Energiewende, the German government amended the policy to include an aggressive phase-out of nuclear by 2022 while maintaining the 2050 targets. This has only magnified the importance of clean, reliable electricity from alternative sources like wind and solar.

Existing Energy Storage Facilities

As of late 2016, there is 1,050 MW of installed (non-PHS) energy storage capacity in Germany. The majority of this capacity is made up of electro-mechanical technologies such as flywheels and compressed air energy storage (CAES; see figure below).

Capacities of EES Types in Germany (Source: Sandia National Laboratories)

However, these numbers are somewhat skewed based on the fact that the electro-mechanical category is essentially two large capacity CAES plants. In reality, electro-chemical projects (mainly batteries) are much more prevalent and represent the vast majority of growth in the German storage market. There are currently 11 electro-chemical type energy storage projects under development in Germany and no electro-mechanical projects under development (see figure below).

Number of EES Projects by Type (Sandia National Laboratories)

Services Uses of Energy Storage

As outlined earlier, there are a multitude of service uses for EES technologies. Currently the existing EES fleet in Germany serves grid operations and stability applications (black start, electric supply capacity), and on-site power for critical transmission infrastructure. A breakdown of service uses in the German market is shown below.

Service Uses of Energy Storage Facilities in Germany (Sandia National Laboratories)

Most notable in is the fact that renewables capacity firming only represents 0.3% of EES currently operating in Germany, excluding pumped hydro storage. In order to understand this, it must be noted that Germany is a net exporter of electricity (next figure below). Having one of the most reliable electrical grids in the world and an ideal geographical location give Germany excellent interconnection to a variety of neighboring power markets; making it easy to export any excess electricity.

This “export balancing” is a primary reason why the EES market has not seen similar growth as renewable energy in Germany − it is easy for Germany to export power to balance the system load during periods of peak renewable production. However, there are negative aspects of this energy exporting such as severe overloading of transmission infrastructure in neighboring countries.

Net Exports of Electricity with Average Day-Ahead Market Pricing for Germany in 2015 (Source: Fraunhofer ISE)

Energy Storage Market Outlook

Logic seems to indicate that with aggressive renewable energy targets, a nuclear phase-out, and increased emphasis on energy independence Germany will need to develop more EES capacity. However, many have conjectured that the lagging expansion of EES in the short and medium term will not pose a barrier to the Energiewende. In fact, some claim that EES will not be a necessity in the next 10-20 years. For example, even when Germany reaches its 2020 wind and solar targets (46 GW and 52 GW, respectively), these would generally not exceed 55 GW of supply and nearly all of this power will be consumed domestically in real-time. Thus, no significant support from EES would be required.

The German Institute for Economy Research echos these sentiments and argue that the grid flexibility needed with significant renewable energy capacity could be provided by more cost-effective options like flexible base-load power plants and better demand side management. Additionally, innovations in power-to-heat technologies which would use surplus wind and solar electricity to feed district heating systems present significant opportunity, while creating a new market of energy service companies.

Power-to-Gas

Germany’s Federal Ministry of Transport and Digital Infrastructure found that P2G is ideally suited for turning excess renewable energy into a diverse product that can be stored for long periods of time and Germany has been the central point for P2G technology development in recent years. There are currently seven P2G projects either operating or under construction in Germany.

While there is work being done, economically feasible production of P2G is currently not achievable due to limited excess electricity and low guaranteed capacity. This limited excess electricity, is an example of the effect of power exports discussed earlier. While there may not be a significant commercial market in the short-term, introduction of P2G for transport could act as an additional driver behind continued renewable energy development in Germany.

In our next post, we cover the energy storage market of the United Kingdom.

(Jon Martin, 2019)

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Energy storage in the European Union

Grid integration of renewables

In our previous post of this blog series on Electrical Energy Storage in the EU we briefly introduced you to different technologies and their use cases. Here, we give you a short overview over the EU energy grid.  Supplying approximately 2,500 TWh annually to 450 million customers across 24 countries, the synchronous interconnected system of Continental Europe (“the Grid”) is the largest interconnected power network in the world. The Grid is made up of transmission system operators (TSOs) from 24 countries stretching from Greece to the Iberic Peninsula in the south, Denmark and Poland in the north, and up to the black sea in the east. The European Network of Transmission System Operators (ENTSO-E) serves as the central agency tasked with promoting cooperation between the TSOs from the member countries in the Grid. The ENTSO-E, in essence, acts as the central TSO for Europe. With over 140 GW of installed wind and solar PV capacity, the EU trails behind only China in installed capacity. A breakdown of the individual contributions of EU member states is shown below in the figure above.

Energy Storage in the EU

For this study a number of European countries were selected for more detailed investigation into energy storage needs. These countries were selected based on a combination of existing market size, intentions for growth in non-dispatchable renewable energy and/or energy storage, and markets with a track record of innovation in the energy sector.

On a total capacity basis (installed and planned MW) the top three energy storage markets within the EU are: Italy, the UK, and Germany. These countries were selected on the basis of these existing market sizes.

Spain and Denmark were selected based on their large amounts of existing renewable energy capacity and − in the case of Denmark − the forecasted growth in renewable energy and energy storage capacity.

While still lagging behind the rest of the EU in terms of decarbonization efforts and having a small portion of their energy from renewable sources, the Netherlands were also selected for further investigation.

Each of the selected countries (Germany, UK, Italy, Spain, Denmark, Netherlands) are discussed in the proceeding sections, providing a more detailed overview outlining their current electricity portfolios and decarbonization efforts, current energy storage statistics, and a brief discussion on market outlook.

Pumped Hydro Storage

With over 183 GW of installed capacity worldwide, pumped hydro storage is the most widely implemented and most established form of energy storage in the world. Due its extensive market penetration, technology maturity, and the fact that this blog is aimed at emerging new storage technologies, the data presented in the following posts excludes this technology.

Find more details about the energy storage market of selected European countries in our next postings.

(Jon Martin, 2019)

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Electrical energy storage

Electrical Energy Storage (EES) is the process of converting electrical energy from a power network into a form that can be stored for converting back to electricity when needed. EES enables electricity to be produced during times of either low demand, low generation cost, or during periods of peak renewable energy generation. This allows producers and transmission system operators (TSOs) the ability to leverage and balance the variance in supply/demand and generation costs by using stored electricity at times of high demand, high generation cost, and/or low generation capacity.
EES has many applications including renewables integration, ancillary services, and electrical grid support. This blog series aims to provide the reader with four aspects of EES:

  1. An overview of the function and applications of EES technologies,
  2. State-of-the-art breakdown of key EES markets in the European Union,
  3. A discussion on the future of these EES markets, and
  4. Applications (Service Uses) of EES.

Table: Some common service uses of EES technologies

Storage Category

Storage Technology

Pumped Hydro

Open Loop

Closed Loop

Electro-chemical

Batteries

Flow Batteries

Capacitors

Thermal Storage

 

Molten Salts

Heat

Ice

Chilled Water

Electro-mechanical

Compressed Air Energy Storage (CAES)

Flywheel

Gravitational Storage

Hydrogen Storage

 

Fuel Cells

H2 Storage

Power-to-Gas

Unlike any other commodities market, electricity-generating industries typically have little or no storage capabilities. Electricity must be used precisely when it is produced, with grid operators constantly balancing electrical supply and demand. With an ever-increasing market share of intermittent renewable energy sources the balancing act is becoming increasingly complex.

While EES is most often touted for its ability to help minimize supply fluctuations by storing electricity produced during periods of peak renewable energy generation, there are many other applications. EES is vital to the safe, reliable operation of the electricity grid by supporting key ancillary services and electrical grid reliability functions. This is often overlooked for the ability to help facilitate renewable energy integration. EES is applicable in all of the major areas of the electricity grid (generation, transmission & distribution, and end user services). A few of the most prevalent service uses are outlined in the Table above. Further explanation on service use/cases will be provide later in this blog, including comprehensive list of EES applications.

Area

Service Use / Case

Discharge Duration in h

Capacity in MW

Examples

Generation

Bulk Storage

4 – 6

1 – 500

Pumped hydro, CAES, Batteries

Contingency

1 – 2

1 – 500

Pumped hydro, CAES, Batteries

Black Start

NA

NA

Batteries

Renewables Firming

2 – 4

1 – 500

Pumped hydro, CAES, Batteries

Transmission & Distribution

Frequency & Voltage Support

0.25 – 1

1 – 10

Flywheels, Capacitors

Transmission Support

2 – 5 sec

10 – 100

Flywheels, Capacitors

On-site Power

8 – 16

1.5 kW – 5 kW

Batteries

Asset Deferral

3 – 6

0.25– 5

Batteries

End User Services

Energy Management

4 – 6

1 kW – 1 MW

Residential storage

Learn more about EES in the EU in the next post.

(Jon Martin, 2019)

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EU market summary for energy storage

Electrical energy storage (EES) is not only a vital component in the reliable operation of modern electrical grids, but also a focal point of the global renewable energy transition. It has been often suggested that EES technologies could be the missing piece to eliminating the technical hurdles facing the implementation of intermittent renewable energy sources. In the following blog posts, selected EES markets within the European Union will be evaluated in detail.

With over 80 MW of installed wind and solar capacity, Germany is by far the leading EU nation in the renewable energy transition. However, experts have argued that Germany’s need for widespread industrial scale energy storage is unlikely to materialize in any significant quantity for up to 20-years. This is due to a number of factors. Germany’s geographic location and abundance of connections to neighbouring power grids makes exporting any electricity fluctuations relatively easy. Additionally, when Germany reaches its 2020 targets for wind and solar capacity (46 GW and 52 GW, respectively) the supply at a given time would generally not exceed 55 GW. Nearly all of this would be consumed domestically, with no/little need for storage.

When evaluating energy storage in the UK, a different story emerges. Being an isolated island nation there is considerably more focus on energy independence to go along with their low-carbon energy goals. However, the existing regulatory environment is cumbersome, and poses barriers significant enough to substantially inhibit the transition to a low-carbon energy sector – including EES. The UK government has acknowledged the existence of regulatory barriers and pledged to address them. As part of this effort, a restructuring of their power market to a capacity-based market is already underway. The outlook for EES in the UK is promising, there is considerable pressure from not only industry, but also the public and the government to continue developing EES facilities at industrial scale.

Italy, once heavily hydro-powered, has grown to rely on natural gas, coal, and oil for 50% of it’s electricity (gas representing 34% alone). The introduction of a solar FIT in 2005 lead to significant growth in the solar industry (Italy now ranks 2nd in per capita solar capacity globally) before the program ended in July 2014. In recent years there has been notable growth in electro-chemical EES capacity (~84 MW installed), primarily driven by a single large-scale project by TERNA, Italy’s transmission system operator (TSO). This capacity has made Italy the leader in EES capacity in the EU, however the market is to-date dominated by the large TSOs.

However, the combination of a reliance on imported natural gas, over 500,000 PV systems no longer collecting FIT premiums, and increasing electricity rates presents a unique market opportunity for residential power-to-gas in Italy.
Denmark is aggressively pursing a 100-percent renewable target for all sectors by 2050. While there is still no official roadmap policy on how they will get there, they have essentially narrowed it down to one of two scenario: a biomass-based scenario, or a wind + hydrogen based scenario. Under the hydrogen-based scenario there would be widespread investment to expand wind capacity and couple this capacity with hydrogen power-to-gas systems for bulk energy storage. With the Danish expertise and embodied investment in wind energy, one would expect that the future Danish energy system would be build around this strength, and hence require significant power-to-gas investment.

The renewable energy industry in Spain has completed stagnated due to retroactive policy changes and taxes on consumption of solar generated electricity introduced in 2015. The implementation of the Royal Decree 900/2015 on self-consumption has rendered PV systems unprofitable, and added additional fees and taxes for the use of EES devices. No evidence was found to suggest a market for energy storage will materialize in Spain in the near future.

The final country investigated was the Netherlands, which has been criticized by the EU for its lack of progress on renewable energy targets. With only 10% of Dutch electricity coming from renewable sources, there is currently little demand for large-scale EES. While the Netherlands may be lagging behind on renewable electricity targets, they have been a leader in EV penetration; a trend that will continue and see 1-million EVs on Dutch roads by 2025. In parallel with the EV growth, there has been a large surge in sub-100kW Li-ion installations for storing energy at electric vehicle (EV) charging stations. It is expected that these applications will continue to be the primary focus of EES in the Netherlands.

Similar to Italy, the Dutch rely heavily on natural gas for energy within their homes. This fact, coupled with an ever-increasing focus on energy independent and efficient houses could make the Netherlands a prime market for residential power-to-gas technologies.

Read more about electrical energy storage here.

Jon Martin, 2019

(Photo: NASA)