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Energy storage research just published

On Friday, I wrote about the "tangled web" of issues surrounding energy storage. It is important to acknowledge and address the pros and cons, from the technology to the business case to the market and public policy.

(I produced the "web" analogy as a result of a well-populated workshop at the California Energy Commission in Sacramento last Thursday, in Friday's column "Renewable Energy and Storage." While this CEC effort has implications for the California Public Utility Commission, I erroneously attributed the latter with hosting the meeting in an earlier version of this piece.)

Taking a hard-nosed look at any nascent technology and its costs, as well as the implications of public policy, famous for unintended consequences, is merely one component of due diligence. Another aspect is giving a technology a fair assessment and seeking out well-vetted opportunities for getting it to market.

One reader on Friday dismissed energy storage as "wishful thinking" without demonstrating any knowledge of its complexities. This attitude, frankly, makes me sick. Of course, I sense a lot of undisguised anger that the world is changing. The so-called "cheap electricity" we have enjoyed has come at vast expenses in environmental damage and clean-up as well as massive tolls in human health. The fact is, we live in a barely post-industrial society that still deludes itself that "cheap electricity" and massive environmental and health impacts and their costs are two separate things. Sadly, we're only just beginning to insist the two go together.

Thus I welcome the report, "Electricity Energy Storage Technology Options," from the Electric Power Research Institute. Here is a rational document from very smart people who work for the electric utility membership of EPRI, who are sincerely attempting to assess the technology, explore the costs and benefits, acknowledge and weigh competing alternatives and examine the market implications. The report identifies the public policy issues, without taking a position.

The only suggestion I have on the potential cesspool of societal deliberation at this juncture is that we immediately lose the mantra of "it'll never work." That is the epitome of defeatist thinking and I reject it outright. (And in the process, of course, ignoring my own advice: "'It'll never work' will never work.")

The report's project manager Dan Rastler, EPRI's director of energy storage and distributed energy resources, told me in an interview last week, that the report "should provide a sense of how to stitch together the benefits, which are quite site-specific, that make a business case for energy storage." (More from that interview with Rastler tomorrow.)

I'll quote and paraphrase from the report's abstract to encourage readers to tackle it.

First, those who don't understand the long-range attractiveness of renewable energy (RE) and the historically massive and continuing subsidies and tax breaks for fossil fuel industries need to face the first sentence. RE is one of three drivers that will increase electricity costs.

"A confluence of industry drivers—including increased deployment of renewable generation, the high capital cost of managing grid peak demands and large capital investments in grid infrastructure for reliability—is creating new interest in electric energy storage systems."

That interest, I'd argue, comes at an opportune time. The low cost of natural gas will not hold forever, nor will slackened demand for electricity. We have a lull in which to prepare for changes in the landscape.

The report offers 10 key storage applications from generation to end-user. Those applications stretch from pumped hydro to compressed air to a variety of batteries to flywheels. A couple key points about the report's contents are delivered up-front.

Capturing multiple benefits for any single technology is crucial for high-value applications and their business cases. That is, "applications that achieve the highest revenues do so by aggregating several benefits across multiple categories." Further, an analytical framework is offered to guide utilities in assessing lifecycle costs and benefits.

EPRI did not shrink from teeing up the thorny societal issues I mentioned earlier:

"Because storage systems have multi-functional characteristics, which complicate rules for ownership and operation among various stakeholders, policy challenges were identified that need to be resolved to realize the true potential of storage assets."

The report notes that utilities are well-positioned to evaluate the gamut of storage challenges and, indeed, nearly three dozen are working with EPRI in that role. (I note too that EPRI also worked closely with vendors to keep the report realistic and useful.) The abstract underscores the notion that practical people and organizations indeed are moving forward to find out what works and what does not work in a rational, cost-effective manner.

"Despite the large need for energy storage solutions, very few grid-integrated storage installations are in actual operation in the United States. This landscape is expected change around 2012, when a host of new storage options supported by U.S. stimulus funding begins to emerge and, in turn, catalyzes a portfolio of new energy storage demonstrations."

Personally, I look forward to reading the report's details and to constructive comments on this and other forums on where the value lies and where unintended consequences lurk. Just don't tell me "it'll never work." That'll never fly.

Phil Carson
Intelligent Utility Daily