Research results set out in the 2017 edition of Lloyd’s Technology Radar – the first to zoom in on low carbon energy and power and energy  – reveals that renewable power generation technologies are now cost competitive with fossil fuels, and ongoing innovation is likely to yield further gains.

“We are very encouraged by the findings, which highlight not only a growing optimism across the industry but a vigorous and intelligent debate about the pathways to decarbonization,” Lloyd’s Register Energy Director Alasdair Buchanan commented upon the report’s release.

“Clearly, there are many uncertainties about exactly how the industry will evolve, but what is inarguable is that the conversation is no longer about ‘should we?’ but ‘how should we do it?’”

Lloyd’s Low Carbon Technology Radar: The Highlights

A global engineering, technical and business services organization wholly owned by the Lloyd’s Register Foundation, Lloyd’s Register explores conditions and the outlook for renewables, nuclear, grid and infrastructure; and energy storage in its double edition Technology Radar – Low Carbon 2017 research report.

In addition to delving into a wide variety of data and information sources spanning the global power-energy value chain, researchers sought out insights and opinions of industry leaders and obtained views from nearly 600 professionals and experts.

Among the report’s key takeaways, Lloyd’s Register found that low-carbon generation technologies have declined in cost to the point where they are now competitive with conventional fossil fuel power generation.

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Financial services giant Morgan Stanley has anticipated that the US energy storage market will grow faster than current consensus expectations, while Deloitte has earmarked the technology for exponential growth – although not perhaps this year.

Morgan Stanley’s “Energy storage: An underappreciated disruptor” says it expects US utilities to “deploy a large amount of storage in the next two to five years”, driven forward primarily by the need to accommodate ever-growing amounts of wind and solar on power networks. It projects growth in the industry from less than US$300 million per year now to a value of US$2- US$4 billion per year by 2020.

Looking at some of the key players in the space, the investment company also identified LG Chem and Tesla as likely dominators of the supply chain, with the scale and manufacturing efficiency to outpace rivals. It expects LG Chem’s production output for energy storage system batteries to reach 11GWh by 2020, while Tesla’s well-documented Gigafactory should be churning out 35GWh of cells and 50GWh of battery packs by 2018, albeit to also serve its electric vehicle range. Nonetheless it rated stock price upside on both of these players as “modest”.

The report’s base case scenario sees the US addressable market for energy storage as around 85GWh, worth US$30 billion. This addressable market could vary greatly in size based on ongoing regulatory wrangling, primarily whether the Federal Energy Regulatory Committee (FERC) will allow utilities to deploy storage in deregulated markets as competitive generator assets.

This could mean a boost of as much as 60GWh over the base case scenario if allowed. The outcome of this dynamic is partly dependent on President Trump’s new appointees to FERC and the answer is likely to be found by late in this year or early next. However, the report’s authors, led by analyst Stephen Byrd, said they did not believe FERC would decide to allow utilities to deploy storage in those deregulated power markets due to the commission’s recent record on the matter.

The report claims utilities will be the majority customers of energy storage systems, rather than individuals or businesses, because the range of benefits offered to utilities is much greater, allowing greater utilisation of grid infrastructure, for example, and also because utilities can factor investment of storage into their business planning.

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A carbon tax is being presented to the US President by very powerful people – Remember, Exxon wants a carbon tax, and Exxon is now the USA’s Secretary of State. Elon Musk being on the President’s advisory board pushing this is definitely having an effect. The particular model of carbon tax I don’t agree with – revenue neutral – as I think it won’t get the job done on its own, however, I will state I’d rather have it than nothing as I do believe future politicians will be able to add important rules surrounding it. Additionally, the offer being made is to replace Obama’s Clean Power Plan with this carbon tax…hrmm…we’ll see. Plan starts at $40/ton – 2.3¢/kWh natural gas electricity, 4¢/kWh coal & 36¢/gallon for gasoline. $220/ton is the number real economists use.

Fraunhofer releases new solar panel encapsulant technique, longer lasting, cheaper and faster to make without frames – (bring your translator) The image above is of the solar cells sealed in the new encapsulant. Solar panels go bad over decades because water vapor + hot/cold cycles affect the insides of the panels (solar cells, copper, silver, etc). It costs money, materials, production time and great expertise to create something that sits directly in sunlight for decades and can resist it. This technology advancement, like every other little advancement (this advancement drops pricing 2%, speeds up production, lasts longer) you see on this daily brief, adds onto the constantly accumulating knowledge that we have. This is why solar panels have fallen from $76/W to 34¢/W. Also – take a look at the link and view the image of the three different solar panels to see the visual difference as the modules age (degradation).

With tax reform on the mind, Legislatures push Energy Storage tax credit – The Federal Investment Tax Credit (ITC), a 30% dollar for dollar project discount, was very powerful in driving the adoption of solar power across the USA. The ITC does not, however, have the ability to drive solar power alone – as the solar industry is still very much based upon a state level legal structure. An energy storage ITC would probably lead toward a similar pattern – states who push energy storage mandates all their own will benefit the most.

Climate Scientists didn’t ‘trick world leaders’ with temperature data – Do understand, there are large monied interests that have many reasons for communicating that climate change science is wrong. 1. They simply think the scientists are wrong. 2. Money and nothing else. 3. Religion. 4. Ignorance. 5. Politics. 6. Power. 7. They want climate change to occur to shift the balance of power on the planet. All of these reasons are a terrible danger to the species – and you, the reader, need to comprehend that headlines are written to get you to click and read – just like the writing by myself. It’s your responsibility to sift through the garbage news and communicate reality to your peers.

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Long a leader in the push to reduce vehicle emissions and switch to renewable energy, California marks another milestone this week.

The last of three battery energy-storage sites will come online in Southern California, providing storage and buffering for unpredictable renewable energy.

Together, the three sites add up to capacity equal to fully 15 percent of all battery storage installed last year—on the planet.

While California had passed an energy-storage mandate, development didn’t kick into high gear until the huge leak in a natural-gas storage facility in Aliso Canyon that was detected in October 2015.

That months-long leak was an environmental disaster, releasing greenhouse-gas emissions equivalent to the annual total from 1.7 million road vehicles. It also cut off fuel supplies to local power plants. 

That led regulators and utilities to look for more flexible ways to deliver electricity and boost the role of renewable sources—including large-scale wind and solar installations far from urban centers—to reduce the risk of winter blackouts.

As a recent article in Bloomberg describes, the three battery storage sites are fully “grid-scale,” far larger than mere pilot or experimental programs.

Each of the three was built by a separate company, and all three were completed in the remarkably short time of six months.

AES used Samsung lithium-ion cells in the energy storage array it built for San Diego Gas & Electric (SDG&E) in Escondido, California, about 30 miles from San Diego.

Billed as the largest installation of its kind in the world, that 120-megawatt-hour site can deliver 30 megawatts, or enough to power about 20,000 homes for four hours.

Tesla, meanwhile, has completed an 80-Mwh array of its commercial-scale storage batteries for Southern California Edison near Chino, California, capable of delivering 20 Mw.

The third battery-storage site was built in Pomona, California, by Altagas Ltd. Opened in December, its 80-Mwh capacity can deliver 20 Mw for four hours.

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The U.S. firm Tesla and South Korea’s LG Chem are tipped to dominate the U.S. battery storage market, which is expected to be worth as much as $50 billion by 2020.

Analysts at investment bank Morgan Stanley suggest Tesla and LG Chem are best positioned to take big market shares in a market that it predicts will grow faster than most others expect.

Morgan Stanley says the “addressable” battery storage market in the US is 85 GWh, or around $30 billion. But if regulators come on board and allow it to compete in deregulated power markets, then that forecast is nearly doubled to 140 GWh or more than $50 billion.

The analysts predict that Tesla and LG Chem are likely to snaffle 30% of this market each, although it doesn’t rule out that either party could gather a 50% share. In the former, it depends on the success of its Gigafactory. For the latter, it would require its own U.S. manufacturing base.

The US market, however, will be just a fraction of the global market – which the Morgan Stanley analysts expect will be 7 to 8 times bigger. China alone is expected to have double the market size of the U.S. in battery storage.

This report – Energy Storage: An Underappreciated Disruptor – says the US market will be focused mainly at the utility level, where power companies and developers will see value in providing grid stability such as ancillary services, and to meet peak demand and supply variations.

In regional grids such as California, with a heavy reliance on storage, this is likely to make mattes difficult for gas generators, who are unlikely to be able to compete on cost or flexibility. In some markets, such as the PJIM, battery storage is already accounting for most of the grid stability market.

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Energy management: Eos Energy Storage (“Eos”) – pioneer of the safe, ultra- low cost Znyth® battery – has announced a manufacturing and assembly partnership with Environment One Corporation (“E/One”), a diversified high-technology company focused on producing protection and performance optimization systems for electric utilities. Through this partnership, E/One will assume responsibility for manufacturing Eos’ flagship energy storage solution, the Eos Aurora®.

From its facility in Niskayuna, New York, E/One is manufacturing and integrating Eos batteries into an outdoor-rated, plug-and-play DC module known as the Energy Stack. Under the manufacturing and supply agreement, E/One will be able to meet growing global demand for Eos’ novel energy storage solution with the use of 100 percent domestic manufacturing capacity and labor. The expansion and new operations resulting from the Eos partnership and support from Empire State Development, New York’s chief economic development agency, will enable E/One to create a larger number of new jobs in New York State’s Capital Region.

“New York is on the fast track to becoming one of the nation’s key hubs for high-tech innovation and E/One’s exciting plans to expand in the Capital Region continues this momentum,” said Governor Andrew Cuomo. “This smart investment will help create jobs and foster innovation in this vital manufacturing sector and continue to grow this region’s economy.”

The Eos Energy Stack is a ready-to-install building block that is aggregated to create the Eos Aurora® 1000│4000, a 1MWI4MWh DC battery system being sold today at a price of $160 per usable kWh, which includes enclosure, environmental management and battery management system. This industry-leading energy storage system allows utilities to reduce costs associated with peak demand, optimize grid infrastructure and more reliably integrate renewable energy.

“Eos has the potential to be the leading energy storage system supplier to the global electric utility industry for decades,” said Eric LaCoppola, E/One’s president. “As a fabricator with over 40 years of experience in manufacturing complex products for electric utilities, E/One enables Eos to compete cost effectively and with aggressively growing volumes in this dynamic space.”

Following a close collaboration to develop Eos prototypes, E/One began producing Eos’ patented Znyth battery at the manufacturer’s upstate New York facility in June 2016. The first commercially available Energy Stacks started rolling off E/One’s production line at the beginning of 2017. E/One is moving production to a dedicated new facility for Eos batteries mid-2017, with total production on course to hit a volume of 400MWh per year.

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As president Trump’s administration prepare to levy tax cut reforms, other Congressional lawmakers are taking a different tack. 

Several bills that would bolster energy storage are waiting in the wings this congressional season, signaling the growing significance of the resource. 

“At this stage there are a lot of moving parts, but we expect multiple pieces of legislation related to storage and taxes to be introduced,” Matt Roberts, executive director of the Energy Storage Association said.

Chief among those bills could be one that failed to make it through the last congressional session, but will likely be re-introduced in the current session.

Sen. Martin Heinrich (D-NM) said he plans to re-introduce legislation in the current congressional session that would provide an investment tax credit for energy storage. He first introduced the tax credit in 2016, but it failed to pass out of committee. 

The Energy Storage Tax Incentive and Deployment Act, which Heinrich’s office said will be introduced “in the near future,” would provide the same investment tax credit (ITC) for commercial energy storage installations as is currently available for solar energy in section 48 of the Internal Revenue Service code.

All forms of storage technology, from flywheels and batteries to pumped hydro and thermal energy, would qualify for the credit as long as they have at least 5 kWh of capacity. Qualifying projects could be consumer-owned, grid-connected, or off-grid.

The proposed legislation, co-sponsored with Dean Heller (R-NV), would also extend the ITC to residential applications of at least 3 kWh, but would apply only to battery storage systems.

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While Tesla captures more headlines, German residential storage company Sonnen currently leads in global product deployments.

Today, Sonnen has more than 15,000 battery installations around the world, the vast majority of which are located Germany. But the company also has a growing U.S.-based business, with monthly unit sales now in the three digits — just one year after the company’s U.S. market launch.

GTM sat down with CEO Christopher Ostermann and Blake Richetta, vice president of North American sales, to discuss Sonnen’s competitive advantages in the home battery arena and how the company plans to grow in the months ahead. Watch below via Facebook Live.

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