One of the biggest issue facing grid-based energy storage today is its availability and one of the reasons it hasn’t taken off at a more rapid pace is the bankability of energy storage technology.
When you look closely at the renewables sector, there is really no doubt that the industry has grown rapidly. But because renewable energy sources aren’t always available, meaning the sun doesn’t always shine and the winds don’t blow constantly, the need for batteries to store the energy produced are all the more important.
So, why hasn’t energy storage taken off at a pace to match that of the renewable energy market? Surprisingly, many people agree that one of the issues is the bankability of energy storage technology. “Bankability” is a term used in the renewable energy field to describe the likelihood that any particular technology or manufacturer will be funded by financiers.
The many types of energy storage technologies
Most people are familiar with lithium-ion storage batteries, they have been in the news a lot, but there are other methods under research and development. One such method, used in wind farms uses compressed air mixed with a little natural gas. Another method called Pumped Storage Hydroelectricity is actually a very popular form of generating power.
A start-up in California has come up with the idea of an advanced rail energy storage system. This rather unusual system uses excess grid energy to power axle-drive motors on rail cars, pushing mass uphill and against gravity to a storage yard. To get the electricity out of the system, when the cars are moving downhill, the wheels on the cars act as generators, putting electricity back into the grid.One storage system, called flywheel energy storage, is actually low maintenance, has a long life and is environmentally friendly, This method stores energy by converting electricity into kinetic energy in the form of spinning wheels held in a frictionless vacuum using a magnetic field to prevent the loss of energy. To produce electricity, the wheels are slowed, thus generating energy.Redox flow batteries are different from lithium-ion batteries, which are solid-state, Redox batteries, on the other hand, use chemical reduction and oxidation reactions to store excess grid energy in a liquid electrolyte solution. Redox batteries are more flexible than solid-state batteries because they can be modified for any application.
One new, and promising energy storage method has been developed by researchers in Germany, using methane gas. They have developed a method of converting the outputs of biogas facilities into methane. In a press release, Siegfried Bajohr, the leader of the new project said:The concept takes the products of biomass gasification—hydrogen, carbon dioxide, and carbon monoxide—and uses a nickel catalyst to produce methane and water. The catalysis is done in a “honeycomb catalyst carrier,” already used in catalytic converters in cars, which are “characterized by a high thermal conductivity and mechanical robustness.”The unit has been moved to Köping, in Sweden, where it will connect with a biomass gasification plant that uses wood residues.There are issues with this storage system, particularly with the possibility of leaks. Methane is a far more potent greenhouse gas and the use of this method is still up in the air.The need for an industry track recordAs you can see, there are many different energy storage methods being researched and in development. But before any method will get financial backing, banks and other financial institutions will need to be assured the method has developed an industry track record through the performance of the technology, and gained maturity in the marketplace.This means the technology has to be sound. A company has to show it has developed and constructed a sufficient number of storage projects and have the real-world data to back up their assertions that the methodology is sound. Investors need to see that a system will outperform the data-sheets.
The other issue has to do with the financial stability of the company. This means a company needs to have a strong enough balance sheet to prove to investors they will be around to back up their warranties provided with their systems. Even then, investors also look at the financial projections of the storage systems themselves.
Modeling software can improve financing predictions
Bankers and other interested investors are not familiar with the intricacies of renewable technologies. They are more in tune with the financial aspects of a company and its projected financial stability. In other words, a start-up with a new energy storage method they believe will be a boon to the industry has to prove it will work.
This is where universal software platforms that provide reliable, repeatable, and accurate predictions for storage from a performance standpoint, as well as from a projected savings perspective are needed. Until recently, most modeling was done in-house by a number of the larger energy storage companies.
There has been a lot of interest in this particular field, and when the dust settles, there will be growth in the number of universal modeling platforms, leading to the investment community embracing many of the new technologies coming out today, allowing the renewables market to continue to grow.