What this means is that the last remaining hurdle to reaching 100% green energy is about to disappear. Already, renewables without "firming" are cheaper than coal most places in the world, and in fact in many places, the operating costs of coal (i.e., ignoring depreciation, debt repayment, etc.) are more than the total cost of new wind or solar (i.e., the cost including depreciation, interest payments and debt repayment) Yet, without storage, the variability of renewable energy sources still crimps just how far we can increase the percentage of renewables in the grid.
At $100/kWh (stored) the cost per kWh dispatched is about 2.7cents/kWh or $27/MWh, for 24 hours of storage (but see note below). This is cheap, yet if costs drop to just $50/kWh (stored) then the cost of providing 24 hours of storage will drop to just 1.4 cents/kWh or $14/MWh dispatched. These low costs will make green energy, even with 24 hours of storage, cheaper than any competing fossil fuel. Remember that, unsubsidised, the average cost for US wind is $42/MWh, with the low end $29/MWh, and the average cost for solar is $38/MWh. The average total cost of coal is $101/MWh, and its average marginal (operating) cost is $36/MWh. Add the cost of storage to wind or solar, and the total is below the cost of new coal, right now. Factor in further falls in the cost of storage, and of wind and solar by 2025, and even with 24 hours of storage, wind and solar "firmed" by storage will be cheaper than the marginal cost of coal. There will be no reason to use already-built coal power stations, and certainly no logic in building new coal power stations.
Even in countries run by denialists and corrupt politicians in the pay of fossil fuel producers, the pivot to green energy will be irresistible.
At current costs, new battery storage at grid level and behind-the-meter is already exploding. The exponential S-curve take-up has started.
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| Source: Wood MacKenzie, via PV Magazine |
A Wood Mackenzie report shows U.S. energy storage deployments tripling in capacity during Q3 ’18 versus last year’s volume, while noting that the future pipeline growth rate doubled versus prior quarters to reach 33 GW of future projects.
The U.S. solar power pipeline is already popping, now the batteries needed to get us to 80% with wind+solar are starting to get down to the mad and exponential growth we’re told to expect.
Per the US Energy Storage Monitor, from Wood Mackenzie Renewables & Power along with the Energy Storage Association (ESA), total energy storage deployed, in the U.S. expanded by 60% in terms of energy and 300% by capacity in the third quarter of 2018 versus the prior year. However, given a strong Q2 both energy and capacity were flat or declining in Q3 ’18 versus the previous quarter.
In total, 61.3 MW / 136.3 MWh of energy storage was installed during Q3 2018, in the U.S. California continued to achor the market, while Hawaii and New York had strong quarters. Behind the meter installations accounted for around 57-60% of capacity deployed.
Going out mostly until 2023, the report noted that the front of the meter pipeline expanded to approximately 33 GW of power. This pipeline more than doubled from just over 15 GW reported at the end of the second quarter.
This pipeline does not include behind the meter deployments, and as noted in this report these represented approximately 60% of the volume this quarter. Future growth is expected to heavily expand on the utility scale.
For instance, PG&E recently approved four energy storage projects totalling 567 MW / 2.64 GWh. These include a 300 MW / 1200 MWh system by Vistra Energy, and a 182.5 MW / 1,095 MWh six hour system by Tesla, which are the largest battery projects seen by pv magazine USA staff in the United States to date.
[Read more here]
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| Source: EPA |
Of course, the plunge in battery costs will also drive out petrol- or diesel-driven cars (ICEVs). If heating also switches to green electricity (which it will, even without government pressure, because it'll be cheaper) something like 60 to 70% of emissions will stop. We need to get rid of just another 20% to prevent runaway global warming. That will mean carbon-friendly fuel for jets, new techniques for making steel and cement, as well as offsetting remaining carbon emissions with afforestation/reforestation and better soil management.
But it's all eminently doable, despite my doubts and worries.
➥ A note on terminology and measurement. A battery's storage capacity is given in kWh or MWh (kilowatt-hours, megawatt-hours). Its output is measured in kW or MW (kilowatts, megawatts). It's like a watering can. You can put 5 litres into it, but you can only pour out, say 80 ml of water per second. It takes time to empty it (and time to fill it). The watering can's capacity is 5 litres (think MWh), its maximum output is 80 ml per second (think MW).
Now, to work out the cost of each kWh or MWh dispatched, over the lifetime of the battery, you take the kWh/MWh stored, and work out a rough LCOE (levelised cost of energy) by dividing it by 3650, which assumes the battery is 100% discharged every day for 10 years. Actually, Tesla batteries seem likely to last much longer than 10 years. In fact, the batteries in Tesla cars might lose just 25% of the capacity over 25 years. If the batteries do in fact last 25 years, the cost per MWh dispatched, at $100/kWh stored will be $11. And at $50/kWh stored, it will cost just $6/MWh dispatched. Of course, we don't know yet for certain how long batteries will last. So I've gone with 10 years above--but I think the eventual numbers will be much, much better.
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