Energy storage can help the country turn the corner on fossil fuel dependence

October 13, 2015

If one were only to look at a single metric, such as the rate of new power plant construction, it would be easy to come to the conclusion that simple-cycle or "peaker" power plants have experienced unchallenged growth. In fact, according to the U.S. Energy Information Administration, over half of the new power capacity added in 2013 was made up of natural gas plants, while 50 percent of those natural gas additions were peaker plants. In short, peaker plants made up 25 percent of all new energy generation as recently as two years ago.

A more holistic examination, however, reveals greater awareness of and improvements to energy storage have put the technology in position to eventually replace peaker plants for good, and make a considerable dent in the nation's consumption of fossil fuels. Furthermore, public perception of peaker plants has continued to erode in recent years as environmental concerns and increasingly common summer heat waves have stoked the desire to consider new alternatives. Often referred to as the "Holy Grail" that will allow solutions like renewables and demand response to reach their full potential, storage may be the key to the country righting its course in terms of its energy consumption.

Energy storage presents an opportunity to fill the gap
An ongoing problem presented by peaker plants is that these simple-cycle facilities are inefficient by design. Because they are only operated during times of peak demand when utilities fall behind, these facilities are allowed to burn up fuel and create considerable amounts of emissions in order to get these part-time turbines up to full speed at a moment's notice. The success of this system, however, is predicated on the expectation that these peaking plants are only operated 10 percent of the time, said Utility Dive. With heat waves becoming more common, it's more difficult for utilities to successfully limit the operation of these highly wasteful facilities.

Enter energy storage, a technology which could act as means of opening up new opportunities for utilities to meet excess demand. According to Greentech Media, integrating energy storage into combined-cycle natural plants, which generate baseload power and produce significantly fewer emissions like carbon dioxide and nitrous oxide, is an increasingly enticing alternative to depending on peaker plants and a steady supply of natural gas. The ability to store electricity, whether stored on the grid or at buildings, helps eliminate the need for fossil fuel-burning peaker plants in the first place.

Additionally, utilities like California's Pacific Gas and Electric Company are already experimenting with utilizing energy storage technologies to stabilize the grid, said Breaking Energy. These tests reflect a growing desire among utilities to deploy energy storage as means of enhancing grid services and optimizing energy distribution. In addition to reducing the need to construct extra peaker plants to meet surges in demand, energy storage will also help limit the cost of electricity for businesses.

Unpredictable supply often translates to extra costs for consumers
A report by Platts revealed that the operators of New England's power grid are still in need of new sources of generation and transmission capacity to deal with increasing strain on the region's electrical infrastructure. Without taking significant measures to update the grid, ensuring stable prices for commercial customers will become increasingly difficult. In particular, the region is still without a solution to summer heat wave trends that push annual peak demand close to 30,000 MW.

With peak demand dependent on natural gas, electricity prices are linked to the availability of this fossil fuel. In times of shortage, high electricity costs and greater risks for blackouts are almost certain. That's why states like Massachusetts have begun to list proposals for energy storage solutions and explore policy options for turning the region into a more energy storage-friendly market, according to the Massachusetts Clean Energy Center.

Fossil fuels have a limited shelf life
New data collected by the International Energy Agency revealed pessimistic projects in the organization's World Energy Outlook study, which suggested that oil and natural gas consumption could exhaust these resources before the year 2070, according to Business Standard. If these estimates are even close to being true, then several nations, including the United States, will face a comprehensive energy crisis within the next century unless energy infrastructures are considerably revamped. Business Standard also noted that more cautious estimates suggest that remaining natural gas and oil supplies will last for another 200 years.

Regardless of which estimate is correct, the truth of the matter is that fossil fuel resources are finite and our history shows that our society won't be cutting down its consumption anytime soon. Costs for fossil fuels are going to go up inevitably as supplies begin to dwindle and clean air goals become a higher priority.  Additionally as more renewable energy comes online its costs will come down. Building owners may leverage these expenses by making changes now and investing in energy storage solutions that provide time of energy purchase choices.