A Plan to Turn Shuttered Coal Plants Into Cutting-Edge Compressed Air Storage
Canadian firm Hydrostor has already lined up warranties and project financing to make the new system bankable.
Canadian firm Hydrostor revealed a new compressed-air storage solution it says can compete with both batteries and natural-gas plants to provide hundreds of megawatts of power.
The company adapted compressor technology well honed by the oil and gas industry to squeeze air down into custom-built tunnel shafts, using water to maintain constant pressure. It dubbed the resulting product Terra: a grid-scale, long-duration storage asset that lies mostly underground, with a visible footprint no bigger than a small industrial building.
By leveraging proven technologies and confronting the challenges posed by the physics of air compression, the Hydrostor team convinced Fortune 500 engineering firm AECOM to sign on as project developer partner — and to backstop the systems with a cost and performance guarantee. Canoe Financial has committed to project financing. This puts Hydrostor in the rare position of rolling out a new storage technology with key bankability measures already in place.
That’s crucial for the kinds of customers the firm is courting: primarily large, traditional utilities. Specifically, Hydrostor wants to use Terra to convert shuttered coal-powered generating facilities into peaking power plants that charge up on cheap grid electricity and discharge when needed, said President and CEO Curtis VanWalleghem. It can also perform transmission decongestion and renewables integration roles.
Lithium-ion batteries enjoy a near-stranglehold on the U.S. storage market. Any upstart device challenging their dominance has to show customers a very good reason to diverge from the conventional path. Plenty of storage companies have offered longer-duration batteries, but they struggle at beating lithium-ion on price.
The Terra solution is highly customizable and allows customers to pick the power-to-energy ratio. For systems of 200 megawatts or more, VanWalleghem said, Hydrostor can deliver 6 to 8 hours of duration on a turnkey installed basis of $150 per kilowatt-hour.
In its Q1 report on the U.S. storage industry, GTM Research calculated the median price for 4-hour utility-scale systems to be $550 per kilowatt-hour. That’s expected to drop to $450 by 2019. It’s not an exact comparison on energy capacity, but it’s safe to say that the price point quoted for Terra (assuming it’s accurate) is several years ahead of the rest of the advanced storage industry.
A new take on familiar ideas
The Terra concept responds to and re-envisions several things simultaneously: compressed air storage, grid-scale battery storage and the use of coal power plant sites. Here’s the breakdown.
With all the hubbub around emerging storage technologies, it’s rare to hear news of compressed-air energy storage (CAES). This technology, like pumped hydro storage, was proven years ago but has been hobbled by the vagaries of geology.
Traditional CAES seals air inside pressurized salt caverns. So to build one, you have to go find a cavern big enough for your needs and strong enough to withstand the pressure without leaking. Needless to say, it’s not exactly a buyer’s market.
More recent attempts to modernize the concept have focused on manufacturing sophisticated tanks that can hold the air. Lightsail raised $70 million to pursue, this and, as Eric Wesoff reported, didn’t get much further than producing a sophisticated tank. SustainX raised $30 million for aboveground CAES, but ultimately had to abandon those plans. It attempted to merge with General Compression to improve below-ground CAES, but both have since wound down.
Hydrostor addressed the siting issue by creating caverns on demand. The company digs what look like mine shafts (more on that later) customized to the needs of a given project. The basic design goes down about 1,200 feet. A structure on the surface houses the equipment used to suck air in, pump it down to charge the system, and suck it back out to discharge. The team installs silencers on the vents to cut out noise pollution.
“We built one in downtown Toronto right next to a school, and it complies with all the noise ordinances,” VanWalleghem said. Permitting involves different questions than a typical storage facility; it’s more like getting mineral rights to dig on a piece of land, or excavating a city block for an underground garage.