Battery technologies starting to disrupt the electricity and automobile industries may also emerge as a trillion-dollar threat to credit markets, according to Fitch Ratings.

A quarter of outstanding global corporate debt, or as much as $3.4 trillion, is linked to the utility- and auto-industry bonds that rely on fossil fuel activities, the ratings agency wrote in a report published Tuesday.

Batteries have the potential to “tip the oil market from growth to contraction earlier than anticipated,” according to Fitch. “The narrative of oil’s decline is well rehearsed — and if it starts to play out there is a risk that capital will act long before” and in the worst case result in an “investor death spiral.”

While hybrid and battery-only cars are making slow progress in denting sales of gasoline and diesel-driven vehicles, their growth trajectory may be grossly underestimated, said the authors of the study. The clean-energy research unit of Bloomberg LP estimates that battery-electric vehicles, which only run on power from a plug, will displace 13 million barrels of oil a day by 2040.

Mapping out the full effect of battery technologies on the fossil fuel economy currently exceeds the time frame of rating methodologies, according to Fitch. It advised utilities to lower their risk by diversifying into clean energy technologies.

“Diversification will help guard against the risk that the markets turn against” the oil economy,” Fitch wrote.

Battery prices fell 35 percent last year and are on a trajectory to make electric vehicles as affordable as their gasoline counterparts over the next six years, according to Bloomberg New Energy Finance. 

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Tesla’s new Powerwall 2 is part of Tesla Energy, the company’s new comprehensive approach to green, all-electric power delivery. The updated home energy storage product is similar to the last one, in that it’s a large, rectangular (now with more rectangularity) device designed to live on a wall in your home (likely in the garage or somewhere similar) – but the big differences are on the inside.

The Powerwall 2.0 has more than twice the energy storage capacity of the original version with 14 kWh capacity. Over double the capacity means double the ability to keep your home humming with guilt-free electric power, culled from the new solar roof offering for private homes that Tesla also unveiled today. Musk said that the Powerwall 2 has enough power to charge lights, sockets and refrigerator for a standard 4 bedroom home for an entire day.

The new flatter design and more angular look, and will be available for $5,500 per unit. Improving supply for power storage has been one of Musk’s key goals with Tesla recently, and it’s clear it wants to do even more with Powerwall 2.

Production for Powerwall 2 begins in the next few weeks, and then installations will start in early December, according to Tesla.

In a Q&A following the event, Tesla CEO Elon Musk said that they full “expect to sell more Powerwalls than cars,” since the product has so much appeal in parts of the world where power isn’t reliable, or widespread, or is very expensive.

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SYRACUSE, N.Y., Oct. 28, 2016 /3BL Media/ – Lockheed Martin (NYSE: LMT) has installed its GridStar™ Lithium energy storage system at the company’s Syracuse, New York, facility. The 1 MW system will reduce electricity bills and emissions for Lockheed Martin’s operations and will also provide services to the New York Independent System Operator (NYISO), the state’s competitive wholesale electricity operator. ENGIE, a global independent power producer and energy services provider, will operate the system and dispatch the power.

“We provide turn-key energy storage solutions for a variety of utilities, independent power producers, commercial and industrial customers and developers,” said Frank Armijo, vice president of Lockheed Martin Energy.  “As we provide customers with advanced energy solutions, we’re pleased also to implement them at our own facilities to further our affordability and sustainability goals.”

System Capabilities
Lockheed Martin Energy used the company’s advanced project analytics capabilities to design the installation.  The project deploys Lockheed Martin’s compact, easy-to-install GridStar™ fully integrated Lithium energy storage system.

Lockheed Martin and ENGIE integrated the GridStar™ system with ENGIE’s energy storage operating software to achieve a multi-functional application of energy storage.  

“This project is a great opportunity to combine multiple capabilities in the growing market for decentralized energy management,” said Jason Goodhand, director of energy storage for ENGIE North America. “By pairing Lockheed Martin’s system with our Green Charge subsidiary’s advanced, patented software as well as ENGIE’s experience in scheduling and dispatching power, we bring together a powerful solution that supports Lockheed Martin’s goals and enhances the flexibility and resiliency of the broader power grid of the New York ISO.”

The Lockheed Martin GridStar™ Lithium architecture consists of modular, scalable, purpose-built energy storage units that contain batteries, local-controls software and all required balance-of-system components. Each GridStar™ energy storage unit can be configured to provide up to 375 kW of power and up to 600 kWh of energy storage. These units can be AC coupled together to scale to multi-MW projects.  Systems also come with extended warranty and long-term maintenance options.

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One of the nation’s leading residential solar companies has teamed up with the world’s largest automotive battery supplier to provide energy storage for homes.

San Francisco-based Sunrun Inc., which bills itself as the largest dedicated residential solar company in the country, said Wednesday it will offer LG Chem’s energy-storage technology. Sunrun will offer lithium-ion batteries as part of its BrightBox solar generation plus energy storage systems.

BrightBox is available only to residential customers in Hawaii and is expected in more states in coming months, although Sunrun did not give a time frame.

“The energy-storage market is advancing at a breakneck pace,” Michael Grasso, Sunrun’s chief marketing officer, said in a statement. “We are enabling a home energy management service that integrates rooftop solar generation with onsite energy storage.”

Wonjoon Suh, a global marketing department leader for LG Chem, said the partnership will produce a product at the forefront of solar and storage technologies. 

“Sunrun understands the importance of giving consumers control of their energy by integrating storage with solar,” Suh said.

LG Chem is Korea’s largest diversified chemical company. It operates three main business units: petrochemicals, IT & electronic materials and energy solutions.

Solar panel companies increasingly have been creating partnerships with storage companies to offer similar products, including through such mergers as battery maker Tesla Motors and SolarCity.

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Lithium-ion batteries are still king in the energy storage market, but their shortcomings are holding back the transition to electric vehicles. One main problem is cost. Li-ion battery packs are expensive, and they push up the price of an EV. Their function as an energy storage unit also means they take up a lot of space, and their weight is a drag on efficiency.

The good news is that Li-ion batteries are constantly being improved. In one of the latest developments, a Columbia Engineering researcher tweaked the manufacturing process with the common plastic PMMA. The result is a 10 to 30 percent jump in energy density, which translates into a smaller, lighter and less expensive energy storage product.

The Li-ion energy storage hiccup

The new development zeroes-in on a hiccup that results from the conventional Li-ion manufacturing process. The problem comes up after the battery is completed, when it is charged for the very first time.

As described by Columbia researchers, part of the electrolyte transitions from a liquid to a solid during the first charge, and that solid adheres onto one of the electrodes. That transition can reduce the energy of a Li-ion battery from 5 to 20 percent. That lowers the capacity of the battery and can interfere with its lifespan, too.

(For those of you new to the topic, the electrodes are the parts of the battery that receive and discharge an electrical current. The electrolyte is the part that stores the charge.)

The numbers are even higher for more sophisticated, high-efficiency Li-ion batteries:

“The loss is approximately 10 percent for state-of-the-art negative electrodes, but can reach as high as 20 to 30 percent for next-generation negative electrodes with high capacity, such as silicon, because these materials have large volume expansion and high surface area.”

One way to work around the problem is to add lithium-saturated materials during the manufacturing process, to counterbalance the lithium “lost” during the first charge.

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The striking and swift evolution of cell phones from cumbersome bricks to sleek, powerful devices owes a lot to the development of the lithium ion batteries used to charge them up.

“Lithium-ion has been transformative for personal electronics,” George Crabtree, director of the Joint Center for Energy Storage Research (JCESR) told CNBC’s Sustainable Energy.

“It’s gotten about a factor of three better in energy density,” Crabtree added. “When it was introduced in 1991, it was already a factor of two better than the next best battery.”

A public-private body, the JCESR says its overarching goal is to develop energy storage solutions that are clean and can be used in transportation and the electricity grid.

The importance of good storage technology should not be underestimated, and the International Energy Agency has said that such technologies have the potential to be “an important tool in achieving a low-carbon future.”

Innovations in battery storage are seen by many as being key to the renewables industry and its efforts to compete with more traditional fossil fuels. Because when it comes to sources like solar and wind, the challenges facing energy storage are manifold. While they are good for the planet, they do not promise a constant stream of power.

“This is sort of a ‘storage moment’,” Crabtree said. “We’re looking for batteries to do for transportation and the electricity grid what they’ve done for personal electronics, to really make a huge change in the way these systems operate.”

Scientists at the JCESR are studying materials and processes in minute detail in order to develop technology that could transform our lives.

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The energy storage startup Swell Energy has launched an all-in-one home energy product it predicts will make residential storage more marketable and profitable.

Residential storage doesn’t make economic sense in most parts of the U.S. Hawaii has a self-consumption program designed to encourage battery adoption, California has a slew of state incentives, and a few utilities elsewhere have implemented residential demand charges and time-of-use rates. But in general, home storage is really just an emotional sell.

Venice-beach based Swell doesn’t make its own batteries. Rather, it packages ones made by partners LG Chem, Sonnen and Tesla. The newly announced EnergyShielddoesn’t bring new technology to the table, but instead innovates in the packaging and financing. The solar-plus-storage offering will play a pivotal role in Swell’s contract with Southern California Edison to deploy 20 megawatt-hours of storage across 3,000 homes for grid services.

The EnergyShield combines rooftop solar and lithium-ion batteries from its partners, plus an energy management system. There are certainly other companies offering solar products paired with storage products, but Swell says its system was built from the ground up with a focus on optimizing the battery.

Only a fraction of solar customers buy storage as well. Thus, storage often gets sold as a kind of add-on to a rooftop solar installation, rather than a piece of the whole system.

“Right now, storage is being sold electively,” said Suleman Khan, a managing partner at Swell. “Ours is a battery-centric product. We are selling a battery with enough PV to charge the battery and optimize your savings.”

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Companies are continuing to turn to energy storage as both an environmental and financial solution, with the ability to provide services back to the grid generating more opportunities to grow revenues. For Lockheed Martin, the latest installment cements the aerospace and defense contractor’s entry into the energy storage market. 

Lockheed Martin’s GridStar system consists of modular, scalable energy storage units that contain batteries, local-controls software and all required balance-of-system components. Lockheed Martin said each unit can be configured to provide up to 375 kW of power and up to 600 kWh of energy storage. 

Within Lockheed Martin, the company’s Lockheed Martin Energy is a line of businesses focused on energy solutions like demand response solutions, energy efficiency, energy storage, nuclear systems, tidal energy technologies and bioenergy generation. Earlier this year, Lockheed Martinexpanded its interests to include energy storage, including both lithium ion and flow battery technology.

The company will target small to medium utility projects and C&I customer uses like demand charge reduction for its lithium-ion offering while attempting to commercialize its flow battery for longer-duration, grid-scale functions.

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Latest Mercom Capital report finds that just $102 million in VC funding for smart grid, battery storage and efficiency sectors was raised in Q3, down from $433 million in Q2. Project funds for residential and commercial storage soars, however.

The global smart grid, battery storage and energy efficiency sectors attracted just $102 million in venture capital (VC) funding in the third quarter (Q3) of the year, according to the latest quarterly report by Mercom Capital.

In Q2, that figure was $433 million as venture capitalists rowed back their investment in these technologies. 

Funding in the smart grid sector was a meager $11 million, which Mercom reports is the lowest quarterly figure it has recorded since it began tracking funding activity. There were just seven deals in Q3, compared to 15 deals in Q2 that raised $222 million. Year on year the trend is the same – Q3 2015 saw $81 million raised in 12 deals.

Battery storage companies also experienced a tightening of the VC belt, with $30 million raised across nine deals. This is in stark contrast to Q2, when 10 deals saw $125 million raised during a busy summer period of investment. Equally, year on year Q3’s figures were anemic next to 2015, when $96 million was raised across nine deals.

The key areas of activity within battery funding focused on six sub-technologies, Mercom said: supercapacitor, lithium-based batteries, energy storage management software, energy storage systems, thermal energy storage, and flow batteries.

Debt and public market financing for storage amounted to $51.6 million in three deals, which was higher than the $40 million raised in Q2. The bulk of this capital was raised through a $40 million sale of FuelCell Energy’s shares and warrants, while Canada’s Electrovaya secured a $10 million loan.

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The residential energy storage industry has gained significant momentum during the past year. Yet while there has been substantial progress, recent high-profile product launches have led to media attention that overestimates the current state of the industry. Despite the potential of residential battery energy storage systems to drive transformation in electric power systems, they are an economical investment only in select markets today.

Going forward, utility involvement in the residential energy storage system (RESS) market will be a turning point for the industry as utilities look to own, distribute or access these storage systems. This article explores the evolving economics of RESS, how utility involvement is rapidly shifting market dynamics and the potential for this technology to lay the foundation for the distributed energy revolution.

Evolving Economics

Residential storage is a flexible resource that provides benefits for both utilities and their customers. These systems are typically installed to help homeowners save money on monthly bills, improve the economics of new or legacy solar photovoltaic (PV) systems and act as a backup power source. In addition, RESS technology is increasingly being recognized for the grid services it can deliver. Benefiting from economies of scale from the consumer electronics and electric vehicle (EV) industries, RESS lithium ion battery costs have come down dramatically. By some estimates, costs have come down by 80 percent for an installed system in leading markets in the past 18 months. This industry’s growth is directly tied to a number of interrelated factors that will dictate residential storage economics, as well as market size in a given country.

One of the most significant factors that will dictate the residential energy storage industry’s growth is how domestic customers pay for electricity around the world. Adjusted compensation paid for excess solar PV generation, time-of-use pricing and the implementation of residential demand charges can quickly change the economics of RESS for a given customer. The reduced compensation paid for excess PV energy sent to the grid has been the foundation of the residential storage business case in leading markets. Due to the growth of the solar PV industry, compensation programs (including net metering and feed-in tariffs) are being phased out or replaced with alternatives.

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