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Lazard’s latest annual Levelized Cost of Storage Analysis (LCOS 5.0) has been published

Lazard’s latest annual Levelized Cost of Storage Analysis (LCOS 5.0) shows that storage costs, particularly for lithium-ion technology, have continued to decline faster than for alternate storage technologies.

 

 

 

Laurent Segalen's picture

Thank Laurent for the Post!

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Matt Chester's picture
Matt Chester on Nov 8, 2019 10:39 pm GMT

Great resource, thanks Laurent. 

shows that storage costs, particularly for lithium-ion technology, have continued to decline faster than for alternate storage technologies.

Do you see any smoke signals that we might be soon reaching a plateau with LI tech that might switch around this trend?

Laurent Segalen's picture
Laurent Segalen on Nov 11, 2019 5:41 pm GMT

Hi Matt

I am in regular contact with Dr Offer of the Imperial College London who has been researching batteries for several years. His conclusions about disruption are to me, more interesting than the PR or noise we encounter all over the place. He is the expert, not me.

Dr Offer's take is that innovation in batteries is slow but predictable: what you see now at industrial level has been discovered in labs almost 20y ago, but - on the optimistic side - the path ahead is clear, and the future improvements have already been found and they will be methodically rolled out.

The trend towards more use, and more applications, is unstoppable.  

More generally, reading the comments below, I would say: Lazard may or not be the experts, but their work is widely respected by the financial community who in the end, will - or not - invest in green technologies. Their input over the years, like the ones of BNEF, have been transformational to the education of financial institutions and have fostered significant inflows of Green investments. Praise them... you cannot only rely on Public Money to develop the Energy Transition.

Matt Chester's picture
Matt Chester on Nov 11, 2019 6:19 pm GMT

Praise them... you cannot only rely on Public Money to develop the Energy Transition.

Definitely true, though hopefully the public sector continues to make private investment both attractive and easy via the right types of public policies and regulations!

Thanks for your insights

Bob Meinetz's picture
Bob Meinetz on Nov 11, 2019 11:56 pm GMT

"Praise them... you cannot only rely on Public Money to develop the Energy Transition."

Laurent, from long experience: you cannot rely on private money to protect the environment. At all. So as much as I would like to praise your "Energy Transition" of solar, wind, and batteries, you may not be aware it already has an abysmal 60-year record on that score. It's the one chiefly responsible for the present urgency of addressing climate change, one dominated by ill-advised or fraudulent attempts to capitalize on a subject understood by few, financing ideas which violate thermodynamic principles unchanged in 14 billion years.

I wouldn't care if others were making foolish investments in ideas they didn't understand. Buyer, beware. I do care when they're collateralizing the world my kids will inhabit, and theirs, and theirs. To me, the environment is the overriding concern, and handing dumb money to people who are only interested in profiting during their lifetimes, with so much at stake, is obscenely irresponsible. But I seem to be in the minority in that belief.

Bob Meinetz's picture
Bob Meinetz on Nov 9, 2019 1:58 am GMT

"Lazard’s latest annual Levelized Cost of Storage Analysis (LCOS 5.0) shows that storage costs, particularly for lithium-ion technology, have continued to decline faster than for alternate storage technologies."

Laurent, I'm curious why you believe Lazard, a research-for-hire consulting firm with no peer review whatsoever, wouldn't be serving up promotional material packaged as "research" for its crowded stable of renewables / storage clients to show prospective clients of their own?

I assume the company didn't assemble this slick analysis as a gesture of good will on behalf of the environment.

Joe Deely's picture
Joe Deely on Nov 9, 2019 11:19 pm GMT

There are plenty of analysts and reports which come up with similar conclusions.

Bob - as usual - presents no alternatives.  He's got nothing. So instead comes up with an attack against the "whistle-blower".

Bob Meinetz's picture
Bob Meinetz on Nov 10, 2019 2:28 am GMT

Joe, since you've failed to present a single example of the "plenty of analysts and reports which come up with similar conclusions", aren't you the pot calling the kettle black?

Please, don't waste our time with more self-serving advertisements from Deutsche Bank, GreenTechMedia, UtilityDive, etc. Present some peer-reviewed examples to back up your claims - or take your ball and go home.

Joe Deely's picture
Joe Deely on Nov 10, 2019 9:03 pm GMT

Bob - 

Here is some research showing similar trends and conclusions. 

University of Texas Energy Institute 

- Michael Webber is lead professor and Joshua Rhoades is the lead investigator. Note: Joshua now works at Vibrant Clan Energy - see below.

NREL Annual Technology Baseline

Colorado Electrification & Decarbonization Study - work done by Vibrant Clean Energy

Note: GTM is a good source for both solar and storage and their data also matches the above sources. 

You have any links to share with us which show different data or conclusions vs Lazard? 

 

Bob Meinetz's picture
Bob Meinetz on Nov 11, 2019 12:17 am GMT

No mention of Li-ion batteries at all from Texas; NREL only looks at Li-ion, and makes the unsupported claim that "a variety of other storage technologies could enhance the flexibility of the electrical grid"; VCE joins in with their patented WIS:DOM® model, a proprietary product designed to tell wind and solar developers the same pretty lies about renewables we've been listening to for a half-century.

I never promised different "conclusions" than Lazard or VCE. I merely point out the inherent conflict of interest in a source which stands to profit by reaching pre-determined ones. Worthless, except for marketing purposes.

Joe Deely's picture
Joe Deely on Nov 11, 2019 2:26 am GMT

Love it Bob.

All three of my sources have produced numerous peer reviewed papers.  

You, with no sources - accuse these scientists of being liars. Why should anyone listen to you?

In particular, your denigration of VCE shows just how quickly you call research worthless when it doesn't agree with your view of the world.

Pretty funny, seeing how you have often mentioned  the founder and CEO of this company - Christopher Clack - as a scientist we should read/follow/trust.

As recently as Oct 2nd you said:

Mark Jacobson at Stanford claimed he had one until it was decimated by Clack et al

You support folks when their research fits your argument and you call them liars when they produce research you disagree with - even when it's the same person. 

 

 

Bob Meinetz's picture
Bob Meinetz on Nov 11, 2019 8:58 am GMT

Again, Joe, your first two references are irrelevant:

"No mention of Li-ion batteries at all from Texas; NREL only looks at Li-ion, and makes the unsupported claim that "a variety of other storage technologies could enhance the flexibility of the electrical grid."

The documents you link to from Lazard and VCE aren't research papers.  They're "reports", bought and paid for by clients, and I never disagreed with anything - they could be 100% accurate. They could also be 100% BS, because there's an inherent conflict of interest when anyone is paid to write something on behalf of a client.

If you can't tell the difference between a scientific study and research-for-hire, here are some clues to help identify the latter:

1) No author is listed 
2) Commissioned by a for-profit company, or is available for sale
3) Methodology is obscured; references are scarce

Do you buy Crest toothpaste when a commercial claims "80% of dentists say Crest patients have whiter teeth"? Of course not. You believe pro-renewables advertising because you want to believe it - like a Crest toothpaste user who wants to believe his teeth are whiter. Otherwise, he's wasted his time and money.

Joe Deely's picture
Joe Deely on Nov 11, 2019 8:48 pm GMT

Bob,

The documents you link to from Lazard and VCE aren't research papers.  They're "reports", bought and paid for by clients, and I never disagreed with anything - they could be 100% accurate. They could also be 100% BS, because there's an inherent conflict of interest when anyone is paid to write something on behalf of a client.

If you can't tell the difference between a scientific study and research-for-hire, here are some clues to help identify the latter:

Huh?

Are you saying that Christopher Clack from VCE has not written reseach papers which serve as backing to the report he wrote about Colorado?

I mean you actually have repeatedly cited one of his research papers.

https://www.pnas.org/content/114/26/6722

There are others including:

https://www.nature.com/articles/nclimate2921

Or are you saying that he is scientist when he writes a paper you like but he is a liar when he writes a paid-or study?

 

 

 

 

 

Bob Meinetz's picture
Bob Meinetz on Nov 12, 2019 6:50 pm GMT

Huh?

How do you know Clack wrote the report? His name is nowhere on it. If he did, apparently he didn't want to take credit for it. Why do you think that might be?

He speaks very highly, but gives few details, of his WIS:dom® model - available for sale from Vibrant Clean Energy. If you don't see a conflict between scientific integrity and hard cash, I can't connect the dots for you (you seem to have difficulty with that on selected subjects).

"Evaluation of a proposal for reliable low-cost grid power with 100% wind, water, and solar" has 20 recognized, international co-authors. Clack, like all of us, has bills to pay. When "Colorado Electrification & Decarbonization Study" appears in the Proceedings of the National Academy of Sciences, let me know (I won't be holding my breath).

Roger Arnold's picture
Roger Arnold on Nov 10, 2019 1:00 am GMT

That "storage costs for lithium-ion technology have continued to decline faster than for alternate storage technololgies" is hardly earth-shaking news, Bob. It's the technology that's receiving the overwhelming bulk of research funding. Everything else I'm aware of that's under active development is pre-commercial. There's no cost history for them that would even make discussion of declining costs meaningful.

Now, if you want to talk about nacent technologies with the potential to undercut lithium-ion on the cost of energy storage, I could ramble on for pages. But that's not what the Lazard report was about.

Bob Meinetz's picture
Bob Meinetz on Nov 10, 2019 5:16 pm GMT

Roger, if lithium-ion technology is the only storage technology in production, how can Lazard compare its LCOE to alternate technologies which don't yet have one?

You're right, it's not earth-shaking news - it doesn't make sense.

Roger Arnold's picture
Roger Arnold on Nov 10, 2019 9:22 pm GMT

I didn't say lithium-ion technology is the only storage technology in production. I said it was, AFAIK, the only technology in production that is seeing substantial funding for further development. So of course its cost is falling, while others are relatively static.

I don't expect costs for lithium-ion storage to ever fall far enough to make them economically viable for providing days to weeks or even months of power when extended periods of adverse weather set in. Instead of daily cycling, batteries addressing that market would be cycling only a few times per year. It would require a 100-fold reduction in specific energy capacity cost for lithium-ion batteries to address that market.

Bob Meinetz's picture
Bob Meinetz on Nov 11, 2019 8:52 am GMT

"It would require a 100-fold reduction in specific energy capacity cost for lithium-ion batteries to address that market."

Roger, IMO a 100-fold reduction in capacity cost is extremely optimistic, given the changes in transmission necessary to accomodate a high level of integration (never mind that batteries would need to be replaced every decade). As I've pointed out in other articles, the existing grid uses a radial topology, where energy from central generating plants spreads outward in transmission capacity specifically designed to reach population centers as efficiently as possible. Run significant power backwards or sideways across such networks, and you run into problems - aka binding grid constraints.

In a 2015 paper Lucas Davis of Berkeley's Haas Energy Institute described how binding grid constraints, in the first year after the shutdown of San Onofre, cost ratepayers $800 million in sky-high spot purchases necessary to keep the grid stable. That's why existing storage lives almost exclusively next to gas plants - to take advantage of the existing radial grid. If storage does try to take on providing 100% power when renewables are unavailable, it relies on existing needs and existing capacity to be exactly in sync with weather patterns or the grid goes down.

The simplistic assumption we can plop big batteries down anywhere on the grid to power the state of California is a non-starter.

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