Storage no longer required to accommodate higher levels of wind energy

Recently, energy storage has been in the news. Contrary to a common misconception, very high levels of wind energy can be reliably integrated without energy storage. Energy storage is typically more expensive than grid operating reforms, which can provide the same flexibility services that storage provides.

Large amounts of wind energy are already being reliably integrated.

The U.S. has been able to install enough wind power to power the equivalent of 18 million average American homes without adding any large-scale energy storage. Similarly, European countries like Denmark, Spain, Ireland, and Germany have successfully integrated very large amounts of wind energy without having to install new energy storage resources. In the U.S., numerous peer-reviewed studies have concluded that wind energy can provide 30 percent or more of our electricity without any need for energy storage.

GREATER NEED FOR FLEXIBILITY

The key to doing so lies in using the sources of flexibility that are already present on the electric grid. There is large variability already present on the electric grid due to changes in electricity demand and supply as consumers turn appliances on and off and power plants unexpectedly go out of service. Grid operators constantly accommodate this variability by increasing and decreasing the output of power plants and turning to other sources of flexibility. By controlling the output of power plants, water held behind hydroelectric dams or natural gas left in a pipeline is used as energy storage. Because this flexibility has already been built into the system, it is almost always much cheaper to use this flexibility than to build new sources of flexibility like energy storage facilities.

The high cost of energy storage relative to other sources of flexibility, including those on the existing power system, is the chief reason why it is not more widely used today. As shown in the National Renewable Energy Laboratory chart below, improved grid operations are the low-hanging fruit for making the power system more flexible. These reforms more than pay for themselves by allowing more efficient power system operations, and are more than sufficient to accommodate even very high levels of wind energy.

Most storage technologies have limited ability to provide the services needed at very high penetrations of wind energy.

Wind energy’s changes are gradual and increasingly predictable, making it cheaper to provide flexibility using slow-acting reserves. Fast-acting reserves, such as flywheels and advanced batteries, can be cost-effective for accommodating variability that occurs on the second-to-second time frame (as shown in the chart below from ITM Power), but changes in wind tend to occur over time periods of 30 minutes or more. That means these technologies provide little to no value for wind integration. Pumped hydroelectric storage, with its ability to store large amounts of energy for long durations, is the only energy storage technology that is currently available that comes close to providing the type of service that wind energy would need at very high penetrations.

In some cases having certain types of energy storage on the grid can modestly reduce the cost of integrating wind. However, in other cases, energy storage has been found to actually provide negative value for the integration of wind energy, even if the energy storage was provided at no cost. Regardless, given the low cost of using existing flexibility to integrate wind energy, and grid operating reforms that enable far greater use of existing flexibility at negative cost, energy storage technologies should not be viewed as an essential tool for the integration of renewable energy.

There is no need for individual power plants to provide constant output.

Some people incorrectly assume that wind output must be “firmed,” i.e. have its variability leveled out, by storage or another resource to make it valuable to electric utilities or system operators. In reality, many changes in wind output actually cancel out opposite changes in electricity demand or supply, as the electricity supply and demand is constantly in flux. Therefore, storage should not be used as a dedicated resource for a single generator or load, as attempting to “firm” a source of variability that was already being canceled out can actually add to the total variability on the electric grid. Regardless, a wind plant is seldom the optimal location for deploying energy storage.

If storage is used, it should be seen as a system resource. The only form of energy storage that is currently operational on a large scale in the U.S. is pumped hydroelectric storage, with a little over 20 GW of installed capacity. Much of this storage was built to provide flexibility to help accommodate the significant increase in nuclear generation that occurred during the 1960’s, 70’s, and 80’s. Just as it is typically not economic for wind plants to increase their output in response to grid demands, all U.S. nuclear plants and many coal plants tend to provide little to no flexibility. This shows that all inflexible generators benefit when other sources of flexibility, including energy storage, can relieve them of having to accommodate changes in electricity supply and demand. In fact, studies in the Netherlands and Ireland found that coal plants were the primary beneficiaries of energy storage. Energy storage allowed coal power plants to run more at night, with this low-cost energy being stored and used to displace more expensive natural gas generation during the day, interestingly causing a net increase in electric sector carbon dioxide emissions. In the U.S., data from the Department of Energy show that pumped hydro storage use declined drastically in 2012 when abnormally low gas prices created an incentive for coal plants to begin cycling their output, reducing the need for storage to provide this flexibility.

Storage’s usefulness in niche applications does not mean that it is needed to increase wind use.

In certain rare situations, it could make sense to site energy storage near a wind plant. If a constraint on the transmission grid prevents a wind plant or group of wind plants from selling their full output on a consistent basis, it could be economical to store electricity that would otherwise have been curtailed. However, this type of application is a short-term fix; building out the transmission grid is typically the more optimal long-term solution to a transmission constraint.

In addition, it is important to keep in mind that while energy storage can be an economically attractive option in certain niche applications, such as small island power systems, this does not indicate that energy storage is an economic option on large mainland power systems. Small island power systems, due to geography and fuel mix, often lack low-cost sources of flexibility such as an ability to exchange power with neighboring grid operators. In contrast, mainland U.S. power systems can far more cost-effectively manage variability from all sources by using transmission to exchange power with a neighboring power system.

Continuing advances in energy storage technology can make it more economically competitive as a source of grid flexibility, and improving the performance and reducing the cost of battery storage remains critical for enabling greater electrification of the transportation sector. There is significant potential for the batteries of plug-in vehicles to be used as energy storage for the grid, particularly by simply altering the rate of charging of these batteries rather than discharging and recharging the batteries. While the potential of such technologies is exciting, it is important to remember that resources like wind energy can already be cost-effectively and reliably integrated with the electric grid without energy storage.

This blog is based on Chapter 11 of the AWEA white paper “Wind energy helps build a more reliable and balanced electricity portfolio.”

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