Wednesday, August 29, 2012

Storage: How to Hoard Electricity (GE; SI)

Understanding the gradations of storage, hoarding and market corners goes a long way to understanding commodities pricing. In the case of solar and wind, without storage they don't make economic sense and so are dependent on and corrupting of, politics.

On that front, one of the problems of the Obama administration's approach to renewables is that Secretary Chu, Science Advisor Holdren, Majordomo Valerie Jarrett and a whole bunch of rentseekers decided that batteries are the way to go.

What if, despite the losses from conversion, it makes more sense to store the energy as thermal or kinetic or even compressed spring energy?

The A123 fiasco is an example of government picking winners rather than providing the conditions where winners can emerge.

From Bloomberg:
Ski Lifts Help Open $25 Billion Market for Storing Power
Technology developers are shuttling between caves and mountaintops to build a market for utilities set to attract $25 billion in annual investment within a decade.

To store surplus electricity from power plants, they’re trying to squeeze air into salt mines and run empty trains up hills, testing how to harness the energy released when the air bursts out and the cars roll back down. Trials are under way at companies from Germany’s Siemens AG (SIE) and RWE AG (RWE) to General Electric Co. (GE) and a startup backed by billionaire Bill Gates, which is experimenting with the momentum of ski lifts.

“Electricity is the only commodity in the world that isn’t really stored,” said Prescott Logan, who heads GE’s storage business in Schenectady, New York, where last month it opened a $100 million plant to make batteries for utilities. When storage becomes cheap and massive, “the impact will be huge.”

The $260 billion renewables industry needs storage so power companies can absorb surges from solar and wind farms from Texas to Mongolia. The devices will be key for plans by Germany to shift Europe’s biggest electricity market from atomic energy, said Gil Forer, Ernst & Young LLP’s clean-tech head in New York.
The consulting firm said annual investment in storage is currently about $2.6 billion, based on data from Pike Research. That’s set to grow to $9.2 billion in 2015 and then to $25 billion by 2021. Logan said Fairfield, Connecticut-based GE expects energy storage to generate $500 million to $1 billion in annual revenue by 2020.

Brad Roberts, executive director of the Electricity Storage Association in Washington, said the business in the U.S. alone may grow to $5 billion within five years.

Water Uphill
While pumping water up a hill has aided in power generation for more than 100 years, the technology is limited to mountainous terrain. Environmentalists have criticized those sites for being harmful to local wildlife, prompting developers to look for alternatives that can be used anywhere anytime....MORE
One of these days I'll get around to writing the hoarding post.