Solar and thermal energy storage to thrive together

May 1, 2015

Multiple pundits and reports have proposed a link between growth of renewable energy applications, in particular the solar industry, and greater adoption of energy storage solutions. For instance, Navigant Research's Energy Storage for the Grid and Ancillary Services report noted that a rise in pairings of energy storage with solar will help drive the expected growth of worldwide deployments of energy storage for grid purposes from 538.4 MW in 2014 to 20.8 GW in 2024.

Part of the reason why energy storage and renewables are expected to grow in tandem is due to how well the technologies complement one another. Renewables generation is replacing fossil fuel generation. Fossil fuels are a form of stored energy. In order to replace fossil fuels with renewables, the storage aspect must also be replaced in order for the grid to be able to ramp supply up and down  or dispatch with changing loads to remain reliable. Renewable generation is dependent upon the sun and wind so it's capacity is not always available like fossil fuel generation.  Multiple states in the U.S. have already committed to exploring solar and energy storage development as a result. In California, solar adoption has increased 10 fold and the utilities plan to install massive amounts of energy storage to store the power surplus created by solar in the afternoon, according to The New York Times.  In the evening, the stored energy will address the peak demand for electricity as people get home on turn on energy hungry appliances.

Too much of a good thing
Another reason why projections about solar and energy storage pairings are so optimistic is because with so much solar being installed, utilities are finding they have oversupply during certain periods and need a way to store the available energy. This problem is just as destabilizing to the grid as too little generation. For instance, in California, there is no longer a peak during the mid-day due to solar. Instead, there is a valley, otherwise known as a duck curve. During certain times of the year, renewable energy ramps up, and produces a "belly" appearance in the mid-afternoon. Then when renewable energy drops off, and demand for electricity peaks, traditional long-start generational resources must sharply ramp and "arch" up similar to the neck of a duck - hence the name duck curve. Energy storage can help alleviate the oversupply of solar and lack of fast acting resources need when solar dies down by adding flexibility to the grid. Instead of using long start generational resources, storage can provide 'ramping', helping electricity supply increase or decrease quickly.

In fact, the California Public Utilities Commission has been working toward greater energy storage deployment of all types, including grid-scale and distributed energy storage, since the CPUC announced its ambitious renewable expansion strategy in 2013, according to the Solar Power Electric Association.

Key to the CPUC's plans is the utilization of energy storage technologies to facilitate the integration of intermittent solar energy generation into the power grid. The organization hopes that the mingling of these technologies will provide a way to circumvent the activation of fuel-consuming combustion turbines when solar power is unavailable.

A utility death spiral looms near
In Hawaii, the utility just recently approved a lengthy backlog of solar applications. The reason for the backlog was unanticipated voltage fluctuations that can overload circuits and lead to blackouts, according to The New York Times. The grid was not designed for surges of electricity flowing out of houses onto the grid and the utility has no way of measuring when and how much electricity is being is behind the customer's meter until it is too late. These problems are not isolated to Hawaii either. Utilities across the U.S. are worried. "With 30—40% annual growth, every two years there will be problems," warns Massoud Amin, professor of electrical and computer engineering at the University of Minnesota.

Solar also poses an economic threat to the utilities. Even though customers install solar, the utilities invest in enough standby power in case solar is unavailable and customers call on the grid for power. To compensate for losses, a large utility in Arizona is adding $50 a month to new solar customer bills. In Wisconsin the added charge is $182 per year. Another option is for utilities to pay less for energy sent to the grid from distributed energy resources.  Savvy solar customers who don't want to wait for lengthy application processes or pay extra fees are turning to distributed energy storage and leaving the grid altogether.

Legislative factors will impact the future of solar and thermal pairings
There is certainly plenty of reason to believe in the momentum behind solar as a benefit for energy storage growth, but it's also important to be mindful of factors that could hinder this relationship from moving forward. For instance, Energy Efficiency Markets pointed out that there are instances where energy storage projects are hindered by slow-moving policy decisions. Questions that still hang in the air in many states about issues like whether to treat energy storage as generation or demand side management. Does energy storage need incentives or special rates to move its development? Should businesses be compensated for distributed energy storage due to its benefits to the grid? Energy storage reduces strain on the grid during peak periods, smoothes the variability of renewables, improves grid reliability, and can provide ancillary service. Today, utilities are taking steps to resolving these questions. Take for example, New York's "Reforming the Energy Vision" initiative, which creates ways to incentivize utilities to promote on-site renewables and energy storage.

The future of solar and energy storage
Adoption of solar and thermal pairings are likely to continue and costs for solar come down and as more public and private sector decision-makers come to understand the value that energy storage mixed with solar generation can bring to their facilities. The growing demand for energy storage as a solution for balancing electricity fluctuations on the grid, renewable intermittency and integration, along with the success of high-profile renewable and solar projects, will help contribute to more policy decisions that further incentivize the pairing of the technologies. Leading architectural firms that are developing zero energy buildings which utilize solar to generate as much energy they consume will find that simply adding a couple wires to the grid doesn't make electricity supply and demand problems go away. Zero energy buildings will need energy storage too.