As renewable power sources scale up, energy storage technologies are also likely to grow rapidly. In fact, as Greentech Media (GTM) reported recently, we're already seeing that happen, with the U.S. energy storage market expanding 243% in 2015, and with the U.S. energy storage market expected "to reach 1.7 gigawatts by 2020—with a value of $2.5 billion." According to GTM, "With exponential growth predicted over the next couple of years, energy storage solutions will deliver smarter, more dynamic energy services, address peak demand challenges and enable the expanded use of renewable generation like wind and solar." And as energy storage scales up, the cost is falling fast, with GTM projecting that the "cost of installing energy-storage systems is expected to decline 41 percent over the next five years as key components get cheaper."
This will, of course, have tremendous implications for electricity markets around the world. In addition, as the video from Stratfor discusses, improved (and cheaper) battery storage technology will help boost growth in electric vehicle penetration. According to Stratfor, it's possible that "by 2022, electric car vehicles may be cost competitive with gasoline-source vehicles." How will this happen? According to Strafor's Science and Technology Analyst Dr. Rebecca Keller:
It's more the manufacturing technologies that are really bringing costs down. The battery technology that's being used right now is lithium-ion batteries, and the key advancement that's happened recently is the Tesla gigafactory...They're producing them on scale, which is bringing the costs down. And that's really the key to any new technology is making it competitive with the old technology that's there.
So, scaling turns out to be the key - no surprise to us, of course, given that the name of this blog is "Scaling Green." Also interesting from the Stratfor conversation:
- China is an important country to watch in terms of being the big lithium-ion battery supplier going forward.
- The Andean nations of Chile and Bolivia are not likely to become the "next Middle East," but they are the "cheapest producers of lithium right now."
- In addition to Chile and Bolivia, other countries with significant lithium reserves include the United States and Australia, Brazil.
- "What we really see in battery technology, or any kind of energy storage technology...is moving towards readily available, widely available, extremely cheap materials like sodium or magnesium...[so] lithium's going to have a relatively short life."
- "There's a lot more competition in grid storage, because you're not confined by a space, so you've got the potential for redox flow batteries, which are really easy to scale up, because all you have to do is add more liquid." Another possibility is molten salt storage.
- As energy storage costs fall, this will have implications on manufacturing and transportation, among other things.
- For now, incentives are required to help jump-start the electric vehicle industry.
The bottom line is that energy storage and electric vehicles are exciting, dynamic and increasingly important areas of cleantech. We'll most certainly be keeping our eyes on all of this in coming months and years.