Battery storage technologies are critical for accelerating the transition from fossil fuels to renewable energy
Fremont, CA: In the United States, battery energy storage has fast become a vital alternative for supporting renewable energy production and electrification. It serves the needs of utilities, transmission network operators, and electrical end-users for load control, grid flexibility, and backup power. Battery energy storage megawatt (MW) deployments are expected to climb 30 percent to 40 percent year over year until 2025, according to market predictions.
Uses of Battery Energy Storage
Stay ahead of the industry with exclusive feature stories on the top companies, expert insights and the latest news delivered straight to your inbox. Subscribe today.
The global shift to a lower-carbon energy system is accelerating the development of renewable energy generation and transportation electrification. While these changes are clearly supportive of long-term climate goals in the United States, they are also posing significant problems for utilities and transmission operators in their efforts to maintain a dependable, flexible, and resilient electrical system.
Energy storage has emerged as the best solution for cost-effectiveness, capital efficiency, ease of integration into operations, dispatchability, and the ability to achieve policy goals. While numerous techniques to boost the power grid, expansion of transmission and distribution infrastructure, use of performance analytic software to maximize solar and wind generation, and a buildout of reserve capacity from conventional resources are all viable options, energy storage has emerged as the solution that best addresses the combined needs of cost-effectiveness, capital efficiency, and ease of deployment.
The scale gained in the electric car business, which has seen investment flow into battery cell, module, and pack manufacture, benefits battery energy storage as well. As a result, the cost of battery energy storage has dropped by more than 80% in the last decade, and it is expected to continue to reduce.
Battery energy storage's attractiveness extends beyond grid resiliency to a diverse collection of use cases that unleash value through cost avoidance, loss mitigation, and new revenue streams. Battery storage minimizes and delays capital-intensive transmission infrastructure expenditures, provides backup power and generates additional revenue in markets prepared to pay for resource adequacy and ancillary grid services at the utility scale. Battery energy storage allows homeowners to increase self-consumption of solar assets and, in some markets, sell more energy to the utility during peak-rate periods in the residential market by charging through the day and discharging during the night, managing time-of-use around different electricity rates and providing backup power for shorter-duration needs. When solar and storage are combined with conventional fuel generators to serve hospitals, data centers, and other vital infrastructure, value capture is similar to residential. Commercial and industrial value capture also benefits from the need for cleaner, vital backup power.
Finally, when energy storage gains momentum throughout utility service areas, utilities will benefit from integrating disparate systems to create a virtual power plant that can function as a low-cost point of production while avoiding the costs of adding new generation sources.