Energy Storage Markets Forecast To Double With Falling Prices And Favorable Policies
Energy storage is a tough concept to grasp. And until now, it’s been an even tougher technology to deploy. But the market for such technology is forecast to exceed the previous four years in this year alone because of falling prices and favorable policies.
Most people envision energy storage as a system that siphons power from the grid at night and harnesses that electricity inside of a device. It is then released during the day at peak demand. That’s coming — and the evidence is starting to mount. The more immediate application, though, is infusing the grid with electrons if the lights start to flicker out.
What’s the proof that the energy storage market is getting past its infancy? GTM Research and the Energy Storage Association have just released the U.S. Energy Storage Monitor 2017 Year-in-Review, which says that 1,000 megawatt-hours were deployed between 2013 and 2017 and which predicts that more than 1,200 megawatt-hours of energy storage will get deployed in 2018 alone; last year, it was 431 megawatt-hours. Altogether, GTM estimates that the annual value of the U.S. energy storage market will exceed $1.2 billion in 2019.
Moreover, the Federal Energy Regulatory Commission voted in mid February to allow grid managers to compensate energy storage in the same way they do traditional power generators. Energy storage would thus graduate beyond the injection of electrons to prevent lights from flickering out and into the wholesale energy markets.
The regional transmission organizations and independent system operators are required to present their plans on how to achieve the commission’s goals later this year. The PJM Interconnection has delivered about 250 megawatts of cumulative energy storage power since 2013. California’s Independent System Operator is also actively trying to incorporate energy storage into mix of generation assets, as PG&E Corp., Sempra Energy and Edison International must collectively buy 1,325 megawatts of energy storage by 2020.
“The recent unanimous, landmark decision issued by the Federal Energy Regulatory Commission (FERC) is expected to lay the groundwork for the integration of energy storage technologies into the U.S. wholesale markets in a manner that compensates storage for the full range of value it is already capable of providing to the grid and end users,” said Kelly Speakes-Backman, chief executive of the Energy Storage Association said.
“Policies and regulatory frameworks that level the playing field will further encourage energy storage deployment throughout 2018 and beyond as the industry builds toward a goal of realizing 35 GW by 2025,” she added.
Storage devices, if they can be shown to work at commercial scale, would be a huge boon to utilities — and an economy — that is trying to do everything from advance renewable power to provide electricity during peak demand. Storage devices can also start up in seconds while generators take much longer.
But technical and financial barriers persist. Basically, it boils down to efficiencies and costs. Many of today’s storage devices can inject about 15-45 minutes of power into the grid.