Energy Storage Industry Overview Prepared for:
September 9, 2015
D I S P U T E S & I N V E S T I G AT I O N S • E C O N O M I C S • F I N A N C I A L A D V I S O RY • M A N A G E M E N T C O N S U LT I N G ©2015 Navigant Consulting, Inc.
Table of Contents
»
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» Background
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» Technologies
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» Applications and Benefits
4
» Key Players and Deployment
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» Market Forecast
©2015 Navigant Consulting, Inc.
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Background Until recently, grid scale electric energy storage has been either pumped hydro, compressed air energy storage, or lead acid batteries. » 1836 Daniell lead acid battery becomes the first commercial battery » 1890’s Pumped storage used in Italy and Switzerland » 1929 First U.S. pumped hydro storage system at Rocky River, New Milford, CT » 1978 First compressed air energy storage (CAES) plant in Huntorf, Germany » 1970’s Lead acid batteries begin to be used for reactive power » 1991 First U.S. CAES plant in McIntosh, Alabama » 2000’s Increased use of batteries in grid scale pilots CAES
Pumped Storage Cutaway Diagram
Source: DOE/EPRI 2013 Electricity Storage Handbook
©2015 Navigant Consulting, Inc.
Source: Haisheng Chen, Progress in electrical energy storage system: A critical review, 2008
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Background While energy storage has been around for a century, recent advancements are causing the industry to re-examine storage. Energy Storage Advancements
Policy Renewable portfolio standards (RPS) and goals FERC Final Order 755 “pay for performance” Federal “STORAGE” bills CA AB2514 CPUC Decision D13-10-040 MA DOER - Storage Initiative MA DPU - Storage Stakeholder Conference CT S.B. 1078 – DEEP procurement of storage ©2015 Navigant Consulting, Inc.
Technology Demonstrations and Commercial Deployment Federal DOE funding • Office of Electricity ESS • Smart Grid Demonstration Program ~$160 million for 16 ES demonstration projects • ARPA-E • Loan Guarantees (proposed $4Billion) State funded demonstrations IPP and Utility demonstrations Commercial deployments 3
Cost Reductions Manufacturing improvements Economies of scale due to electric vehicles Competition Influx of capital
Technologies Electrical energy is generally stored through mechanical, chemical, thermal or electro-chemical means. Mechanical
Source: Beacon Power
• Pumped Hydro Storage (PHS) • Compressed Air Energy Storage (CAES) • Flywheel
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Flow Batteries
Batteries
Source: www.ZBBenergy.com
Source: SAFT
• Lead Acid • Advanced Lead Acid • Zinc Air • Sodium Sulfur • Sodium Metal Halide • Sodium Ion • Other
Lithium• Iron Phosphate • Manganese Oxide • Titanate • Cobalt • Nickel Cobalt Aluminum • Nickel Manganese Cobalt
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• • • •
Zinc Bromine Vanadium Redox Iron Chromium Other
Other
Source: www.smartgrid.gov
Thermal • Ice Based • Thermal Molten Salt Power To Gas • Hydrogen • Synthetic Natural Gas Capacitors • electric double-layer capacitors, or “supercapacitors” or “ultracapacitors”
Technologies A typical storage system contains a storage technology, thermal management system, power conversion system and software & controls. Energy Storage System Components
Thermal Management
Power Conversion
Storage Mechanism
Software & Controls
Energy Storage System Image Source: REneweconomy, AVL, Energy Storage Report, Free-SQL
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Technologies For a battery system, the software & controls, and thermal management are often integrated across the modules, packs and system. Representative Battery Storage System
Cells
• High Power • High Energy • Chemistry
Modules
Packs
• Internal Cooling • Sensors, monitoring, balancing • Communication
• Battery Management • Wiring & racking • Relays, fuses, etc.
Image Source: A123 Systems
©2015 Navigant Consulting, Inc.
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System
• Power Conversion System • Software &Controls • Thermal Management Systems
Applications and Benefits Navigant’s energy storage valuation framework categorizes applications as: load leveling, grid operational support, and grid stabilization. Load Leveling (Generating power off peak and using it on peak) •Renewable Energy Shifting •Wholesale Market & Cost Optimization (e.g., arbitrage) •Retail Market (e.g., time of use rates, demand charge management) •Asset Management
Grid Operational Support (Matching supply to demand) •Load Following •Operating Reserves •Frequency Regulation •Renewable Energy Firming •Black Start
Grid Stabilization (Improving reliability) •Renewable Energy Ramping •Renewable Energy Smoothing •Backup Power •Power Quality
©2015 Navigant Consulting, Inc.
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Applications and Benefits Depending on the application, energy storage will provide a combination of economic, reliability, and environmental benefits. Economic
©2015 Navigant Consulting, Inc.
Reduced Water Use
X
X
X
X
X
X
X
X
X X X
X X X
X X X
X X X
X X X
X X X
X X X
X X X
X X X
X X
X X X
X X X
X X X
X X
X X
X X
X X X
Improved Power Quality
X
Reduced Outages
X
Deferred Transmission Capacity Investments Deferred Distribution Capacity Investments
Reduced SOX, NOX, and Particulate Emissions
Water
Reduced CO2 Emissions
Air
Reduced Electricity Cost
Interruptions
Reduced Electricity Losses
Cost
Deferred Generation Capacity Investments
X
Efficiency
Reduced Congestion Cost
Ancillary Service Revenue X
Asset Utilization
Environmental
Optimized Generator Operation
Load Leveling Renewable Energy Shifting X Wholesale Market Arbitrage & Cost Optimization X Retail Market Asset Management Grid Operational Support Operating Reserves Load Following Frequency Regulation Renewable Energy Capacity Firming Black Start Grid Stabilization Renewable Energy Ramping Renewable Energy Smoothing Backup Power Power Quality
Capacity Revenue
Applications
Arbitrage Revenue
Market Revenue
Reliability
X X X
X X
X X X
X X X 8
Key Players and Deployment The value chain includes technology manufacturers, system integrators, project developers, owners/operators, and financing organizations. Energy Storage Value Chain Upstream Thermal Storage Power Technology Conversion Management Manufacturer Manufacturer Manufacturer
Downstream Software & Controls Vendor
System Integrator
Project Developer
EPC Contractor
Operator
Maintenance Provider
Typical Downstream Activities: - Site selection and permitting - Arranging project level finance - Contracting with storage system end user - Site preparation, installation and commissioning - Operation - Ongoing maintenance
Typical Upstream Activities: - Component manufacturing and testing - Software and controls algorithm development - Component and system level modelling, design, and testing
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Financer
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Key Players and Deployment Technology manufacturers will often perform all the functions across the value chain. Mechanical
Source: Beacon Power
CAES • Dresser Rand • MAN Turbo • GCX Energy • Hydrostor • Highview • APEX, RWE, etc. Flywheel • Beacon Power • Temporal Power • PowerThru • Vycon Energy ©2015 Navigant Consulting, Inc.
Flow Batteries
Batteries
Source: www.ZBBenergy.com
Source: SAFT
Lithium Ion Lead Acid • Saft • East Penn (Ecoult) • Toshiba • Exide • AltairNano • EnerSys • Electrovaya • Axion • Dow Kokam • Trojan • LG Chem • Atraverda • BYD Zinc Air Sodium Metal Halide • Eos Energy • Fiamm • ViZn • GE Other Sodium Sulfur • Ambri • NGK • Aquion 10
Zinc Bromide • ZBB • Primus Power • RedFlow Vanadium Redox • Prudent Energy • UniEnergy Techn. • Imergy • Gildemeister • Sumitomo • Vionx Other • Enervault • Enstorage
Other
Source: www.smartgrid.gov
Thermal • Ice Energy • Calmac Power To Gas • Hydrogenics • ITM Power • ETOGAS • Sunfire Ultracaps • Ionova • Maxwell
Key Players and Deployment The following technology manufacturers have supplied energy storage systems for deployment globally. Deployed Capacity Market Share by Top 20 Technology Vendors* World Markets: 1Q 2015 ABB ETOGAS GmbH DN Tanks 1% 1% 1% LG Chem Prudent EnerDel 2% 1% Energy 1%
Sumitomo 1%
Altairnano Samsung SDI 2% 2% ZBB Energy 3%
Toshiba 3% Saft 4%
Beacon Power, LLC BYD 5% 6% Xtreme Power* 6%
NGK Insulators 47%
A123 Systems** 14%
(Source: Navigant Research) *Note: Does not include PHS, traditional CAES, or solar thermal storage. **NEC acquired the grid storage business from A123 Systems and is now a systems integrator ***Younicos acquired Xtreme Power and is now a systems integrator.
©2015 Navigant Consulting, Inc.
Rongke Power 1%
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Key Players and Deployment California and Texas lead the US in grid scale energy storage which is larger than the total deployed capacity of behind the meter storage. FTM Storage, Q1 2015
BTM Storage, Q1 2015
Capacity (MW)
Capacity (MW) Washington, 0.75
Ohio, 31.13
Vermont, 0.63
Illinois, 73.25
West Virginia, 35.024
Michigan, 0.5
New York, 0.43
Texas, 43.737
California, 8.18
California, 66.496
Top 5 States (10 MW)
Top 5 States (250 MW) Source: Navigant Research ©2015 Navigant Consulting, Inc.
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Key Players and Deployment US grid scale pipeline is driven by policy in CA and frequency regulation elsewhere. FTM Storage, Q1 2015
BTM Storage, Q1 2015
Capacity (MW)
Capacity (MW)
Indiana, 40
New Jersey, 1.5
Hawaii, 1
New York, 1
Illinois, 39.6 California, 158.1 West Virginia, 31.5 Alaska, 25
California, 180.23
Source: Navigant Research ©2015 Navigant Consulting, Inc.
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Market Forecasts Cost reductions are expected across all technologies, with the largest percentage reductions expected for Li ion and flow batteries. Lowest Cell Price for Utility Applications 2014, 2017, 2020 $700
$600
$/kWh
$500
$400
$300
$200
$100
$-
2014 Lithium Ion
Sodium Sulfur
2017 Sodium Metal Halide
Source: Navigant Research
©2015 Navigant Consulting, Inc.
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2020 Advanced Lead-Acid
Flow Batteries
Market Forecasts TOU pricing will drive BTM growth, while FTM growth will be dominated by applications to defer T&D expenditures. Front the meter battery energy capacity (MWh) and revenue ($M) by application
Total Revenue
8000
$2,500
$2,000
8,000
$1,500 6,000
$1,000
4,000
$500
2,000
$2,500
Grid Asset Optimization
7000
Utility-Scale Renewables Integration
6000
Frequency Regulation
5000
Total Revenue
Reserve Products
$2,000
T&D Upgrade Deferral
$1,500
4000 $1,000
3000 2000
$500
1000 $0
Source: Navigant Research ©2015 Navigant Consulting, Inc.
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2024
2023
2022
2021
2020
2019
2018
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
2017
$-
-
2016
0 2015
(MWh)
10,000
Commercial Energy Storage
$3,000
(MWh)
12,000
Residential Energy Storage
($ Millions)
14,000
($ Millions)
Behind the meter battery energy capacity (MWh) and revenue ($M) by application)
Key CONTACTS Colette Lamontagne Director Burlington, MA 781-270-8340
[email protected]
©2010 Navigant Consulting, Inc. ©2015 Confidential and proprietary. Do not distribute or copy.
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