Battery Energy Storage: the next disruptive Technology in the Electric Power Industry
Battery Energy Storage: the next disruptive Technology in the Electric Power Industry
Source: Alternating energy network
with the growth of the electronic products market and the (EV) demand for electric vehicles, the value of battery storage has increased rapidly. Many manufacturers in Asia, Europe and the United States are expanding their lithium-ion battery manufacturing to meet the needs of the electric vehicle industry and other power applications. With exploration and technological advances in low-cost battery manufacturing, the cost of manufacturing batteries fell from nearly $1000 per kilowatt-hour in 2010 to $230 in 2016.
McKinsey's research found that for many business customers, storage costs are now very economical and can effectively reduce their peak consumption levels. At the same time, at low prices, energy storage has begun to play a broader role in the energy market, extending from pure grid balance to wider uses, such as the provision of power quality services, and support for renewable energy grid connectivity. In addition, the combination of solar energy and energy storage enables home units to produce, store and consume electricity on demand, rather than always importing or exporting electricity to the grid, which will make it more convenient for more solar users.
In this McKinsey report, Battery Storage: next disruptive Technologies in the Power Industry, we will discuss how energy storage technology will change the way electricity markets operate, how customers consume and produce electricity as these trends evolve. And the role of utilities and third parties. The report focuses on energy storage developments in Europe and the United States, and there are likely to be more possibilities for markets in other countries.
Energy storage devices can be deployed in power grids or in individual consumer homes or businesses. Because of its complexity, the economy of energy storage technology is influenced by customer type, location, power grid demand, regulation, load condition, tariff structure and application nature. It also has unique flexibility to stack value streams and change their scheduling to meet the different needs of an hour or even a year. These flows of value are growing both in value and in the size of the market.
Energy storage technology can also help address the planning and operation of power grids in markets where loads are expected to be flat or falling, benefiting utilities. Regulators in some U. S. states, for example, are testing new compensation models that pay off by giving utilities incentives to provide distributed power generation projects. It will also help utilities delay expensive new investments and reduce the risk that long-term capital accounts will not be used.
Utility companies purchase energy storage equipment to meet long-term regulatory requirements and short-term electricity demand. As energy storage costs fall, these projects will continue to reduce power generation costs, thereby lowering consumers' electricity bills and putting further pressure on existing conventional natural gas and coal power generation. Utilities must understand low-cost energy storage technologies and adjust themselves in two ways: first, redesigning the pay structure to explore new opportunities. Regulators and utilities need to find new ways to restore their investments in the grid.
Power grid is a long-standing asset, and its construction and maintenance cost is very high. Consumers do not like the fixed cost of grid access. But a fixed fee ensures that everyone using the grid pays, and people are used to paying for the energy they use. But as more customers produce their own energy, reliability and market access to the grid becomes more valuable than power itself.
Because any rate design changes are slow and gradual, especially those that transition to fixed costs, utilities need to try to realize new market ideas by generating new revenue opportunities from expanded services and new transaction fees. In Australia, utilities are providing and consulting services for solar and energy storage installers; There is a new pilot program in the United States that sells advanced analytical and data management services to consumers to help them manage energy use, and utilities in several states are exploring new services to invest in grid modernization and electrification.
Second, utility companies also need to rethink the planning of the grid system. In order to fundamentally change the method of power system planning, utility companies need to invest in sophisticated analysis software and advanced algorithms to realize the modernization of the power grid. This requires abandoning traditional systems planning, reconsidering code and standards, switching to circuit node planning, and using asset health assessments to ensure the highest priority needs to solve system problems.
The first half of Northvol's 32-gigawatt-hour "ETT" battery plant is under construction at a cost of up to 1.6 billion euros, and one aspect of its value chain will be battery negative production. The estimated value varies, but about 80% or more of the cost of the cell core is derived from the raw material cost, while the raw material cost comes largely from the negative active materials, mainly including nickel, manganese and cobalt.
In contrast, after solid-state batteries integrate separators and electrolytes, the positive electrode may be a technique that needs to be changed in the medium term. "the negative pole will be the longer-lasting end of the equation," Cerruti said. And what you need to do is make long-term investments and make sure that the money you invest will work over a long period of time. "
By contrast, Cerruti said that at least in the early stages, Northvolt would not compete in technology, but would compete in production processes in a straight-line manner. "We don't want to be the first company to launch solid-state batteries," he said. "there may be people who are ahead of us, and what others want to do, we want to do better and more efficiently."
Cerruti also hinted that the Ett plant was just in its infancy and might need to continue to expand production. He said: "in this industry, you can either grow up or just pack up and go home." Asked if Northvolt would start building sites for other plants, he replied: "it's too early to give a specific time, but the market has taken shape. Our clients are asking us to start thinking about it. " For this reason, Northvolt focuses on modularizing its industry devices to make it easier to replicate devices quickly and efficiently.
Northvolt, which is also funded by the European Investment Bank, has partnered with industry groups such as ABB,Scania and BMW before the Ett plant begins production next year. While acknowledging that the size of the sector is key to survival, Cerutti said Northvolt is not concerned that Asian companies such as LG Chemical are building plants in Europe. Instead, he thinks this is important for his business plans, as big companies will attract more suppliers.
"We are building an industry in Europe from scratch," he said. "although we have high-quality academic research, we have no experience in scale. All the experience comes from Asia. No matter how successful and how large the Northvolt will be in the future, we will not be able to form a large enough scale to bring these supply chains and investments to Europe. "
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