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Large-scale energy storage technologies could play a major
role in electricity grids by 2016, according to a report that
predicts the falling cost of storage systems will help accelerate
the rollout of intermittent renewable energy technologies.
Energy storage systems such as batteries and fuel cells have
long been regarded as a means of more effectively managing
grids that rely on large amounts of renewable energy from
unreliable intermittent sources such as wind and solar farms.
To-date, large-scale energy storage systems have proved
too expensive to be deployed at a commercial scale and have
been largely confined to niche applications and pilot
projects.
However, analyst firm Bloomberg New Energy Finance (BNEF)
is now predicting that substantial penetration of energy storage
technologies into national grids is likely to be led by an
expected drop in battery prices over the next few years.
According to a new report
from the firm, grid-scale lithium-ion battery projects today
cost more than $1,000/kWh - but, with battery manufacturing
capacity likely to outstrip supply in the short term, BNEF
forecast prices will drop over the next 36 months and reach
$600/kWh by 2015.
The report argues that falling prices mean using storage
systems to manage energy prices, buying energy at periods
of low demand and then storing it for use during peak periods
could make economic sense for large power consumers within
the next year and for smaller consumers by 2016.
Significant growth is also expected for pumped hydro and
flywheel energy storage systems, meaning that, by 2020, energy
storage could be in widespread use in the UK across the transmission
and distribution systems and even co-located with wind farms
and solar parks.
However, BNEF warns that changes in government policy, such
as allowing transmission and distribution utilities to sell
stored electricity to National Grid, will be needed to realise
the benefits of bringing more renewable energy online and
allowing commercial users to avoid having to purchase power
at the most expensive times of day.
"The prize may be within sight, but there are obstacles that
need to be cleared before the UK can attain it," said Shu
Sun, energy storage analyst at BNEF.
"For widespread adoption of storage ... appropriate mechanisms
need to be built into RIIO (revenue equals incentives plus
innovation and outputs) - the new regulatory model that aims
to promote innovation and the use of new technologies within
the UK power networks."
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