China Energy Storage Network News: The process of achieving "carbon neutrality" in various countries around the world is the transformation process of clean energy gradually replacing traditional fossil fuels, with great hope placed on hydropower, wind energy, and solar energy.
From a global perspective, energy storage is mainly divided into traditional energy storage and new energy storage. The former mainly refers to pumped energy storage, while the latter includes electrochemical energy storage and compressed air energy storage.
Affected by the Russia-Ukraine conflict, the energy price in Europe continued to rise this year, which led to the rapid rise of residential electricity prices, thus stimulating the surge of household energy storage demand, and superimposed on the rapid growth of the American market, making the overseas energy storage market a high profile. Based on this, Bloomberg New Energy Finance (BNEF) has made a new prediction that the cumulative installed capacity of energy storage deployed globally will surge by the end of 2030, and BNEF emphasizes that the 1920s will be the "energy storage era".
The process of achieving "carbon neutrality" in various countries around the world is a transformation process in which clean energy gradually replaces traditional fossil fuels. Among them, hydropower, wind energy, and solar energy have high hopes, but there is a bottleneck in the total amount of water resources. Therefore, wind and solar energy will play a major role in diluting traditional thermal power and creating future green electricity. However, solar energy and wind energy belong to unstable power sources. For example, the daily fluctuation range of wind energy output can reach up to 80%, with peak output occurring around the early morning and reaching low points in the afternoon. The "reverse load" characteristic is very obvious. The fluctuation range of light energy during the day is even greater, reaching the peak of the day at noon, and showing a uniform decline before and after noon. The output at night is 0, with distinct peak valley characteristics. In addition, light energy is also easily affected by weather, and the impact of cloudy and sunny weather on the actual active power release of light energy is very significant. It is precisely the volatility, intermittency, and randomness of wind and solar energy that lead to unstable power output on the power generation side, making it difficult to achieve distribution balance on the grid side, and at the same time, the demand on the user side cannot be accurately and timely responded to and met, resulting in significant fluctuations in the entire power system.
But energy storage can completely eliminate the worries of converting clean energy into green electricity. On the one hand, during periods of abundant wind and solar energy or low electricity consumption, surplus energy is collected and stored, while during periods of low power or peak electricity consumption, the stored energy is released. This can fully utilize and develop every unit of clean energy, greatly amplifying the effect of absorbing wind and solar energy; On the other hand, storing wind and solar energy can greatly reduce and shield against unexpected interference from subsequent weather factors, thereby enhancing the continuity and stability of power transmission on the power generation side. At the same time, with the help of energy storage, the grid side (enterprise) can purchase electricity at a low price when the power supply side is in high demand, and sell electricity at a high price when the demand on the power consumption side is strong. While carrying out peak shaving and valley filling, it also greatly improves the flexibility of the grid system; In addition, whether on the power generation side, grid side, or user side, the electricity obtained from energy storage can be transferred and profited from through the electricity trading market when there is a shortage of electricity and electricity prices rise. This can undoubtedly significantly enhance the competitiveness of energy storage entities and guide the development and use of energy storage resources into a virtuous track. Overall, the stronger the substitution of clean energy for fossil fuels, the greater the difficulty in balancing power supply and demand. However, the use of energy storage can fully eliminate the substitution risks of clean energy, and even energy storage can be seen as a ballast stone for energy transformation.
From a global perspective, energy storage is mainly divided into traditional energy storage and new energy storage. The former mainly refers to pumped energy storage, while the latter includes electrochemical energy storage and compressed air energy storage. Pumped energy storage refers to the use of mechanical pumping equipment to pump water from low to high places and generate hydroelectric power when needed; Electrochemical energy storage relies on high-power and high-performance batteries for positive and negative energy storage and discharge, while compressed air energy storage mainly utilizes the remaining electricity from the grid during low load periods to compress the air, which is stored in high-pressure sealed facilities and released during peak electricity consumption to drive gas turbine power generation. From the perspective of global installed capacity and market share, the cumulative installed capacity of pumped storage is currently * large, with electrochemical energy storage ranking second, and the proportion of compressed air energy storage projects in terms of layout is third.
Although pumped storage is currently the main energy storage method, and both technology accumulation and business models are relatively mature, pumped storage is strictly limited by geographical potential space. It not only has slow start-up speed, long construction cycle, but also limited resource endowment and high cost. In contrast, electrochemical energy storage is basically not affected by external conditions, has fast response speed, and flexible construction projects. More importantly, as a widely distributed electrochemical energy storage variety, lithium-ion energy storage not only has mature technology, but also the marginal trend of cost reduction is becoming more and more significant, which has driven the overall cost reduction of lithium-ion energy storage. According to BNEF calculations, the global cost of lithium battery energy storage in 2022 is approximately $1.66 per watt hour, and it is expected to decrease to approximately $1.29 per watt hour by 2025. In this way, it seems inevitable that electrochemical energy storage will eventually replace the dominant position of pumped energy storage. Data shows that as of the end of 2021, the cumulative installed capacity of global pumped storage has decreased by 4.1% year-on-year, while the proportion of electrochemical energy storage has increased to 12.2%, with a cumulative installed capacity of 25.4GW, an increase of 67.7% year-on-year.
In terms of electrochemical energy storage, the current market share of lithium-ion batteries exceeds 90%. However, another sodium battery serving as an energy storage carrier may catch up. Data shows that sodium accounts for up to 2.75% of the Earth's crust and is distributed globally, while lithium is only 0.0065%, mainly distributed in the Americas. Meanwhile, in terms of price, the price of sodium is only 0.29 US dollars per kilogram, while the current price of lithium is about 21.5 US dollars per kilogram. The raw material cost of sodium batteries is 30% -40% lower than that of lithium batteries. In addition, sodium ion batteries can achieve a discharge retention rate of over 90% in a low temperature environment of -20 ℃, and can release over 70% of capacity at a low temperature of -40 ℃. At a high temperature of 80 ℃, they can be recycled for charging and discharging, making project implementation and scenario applications more flexible. Therefore, replacing lithium batteries with sodium batteries will be the trend, and the same conclusion is also applicable to new types of batteries such as vanadium batteries with longer lifespan, higher safety, and abundant resources.
Compared to electrochemical energy storage, although the scale of compressed air energy storage is much lower, Germany and the United States have already started commercial development and application. Initially, they mainly used low-quality electricity from low valleys to compress and store air in large gas storage caves. During peak electricity consumption, high-pressure air is released from the gas storage caves, and the same fuel is burned to drive expansion engines for power generation. However, traditional compressed air energy storage relies on fossil fuels The shortcomings of relying on natural gas storage caves constrain the expansion space. In response to related bottleneck factors, countries around the world are actively developing new compressed air energy storage technologies, such as thermal storage compressed air energy storage systems, isothermal compressed air energy storage systems, and liquefied air energy storage systems. At present, the new type of compressed air energy storage is basically equivalent to pumped energy storage in terms of function, cost, lifespan, and performance. At the same time, it also demonstrates advantages such as large scale, long lifespan, pollution-free, long-term efficiency, and flexibility, making it a promising energy storage technology.
Whether it is pumped energy storage, electrochemical energy storage, or compressed air energy storage, they all form a closely related and complete industrial chain. Upstream has raw materials and production equipment; In the midstream, there are energy storage project construction and integration systems composed of battery packs, battery management systems (responsible for battery status), energy management systems (responsible for energy scheduling), and energy storage converters (responsible for current conversion). In the downstream, there are energy storage product installations and end users. For major global economies, it is not only necessary to compete for high-end discourse power in the industrial chain, such as standard control of products and projects, but also to seize the trade value-added of the industrial chain, such as the output capacity of products and technological services, as well as the establishment of entry barriers to protect domestic industries and products. Therefore, the seemingly new energy storage based on the common vision of human "carbon neutrality" is also inevitably marked with competitiveness.
Scanning the world, some major energy storage promotion and application countries generally support the development of the energy storage market through policy mechanisms such as providing subsidies and investment tax exemptions. In the United States, the Investment Tax Credit (ITC) policy introduced by the federal government supports energy storage systems above 5 kilowatt hours to receive a 30% higher ITC tax refund. At the same time, the Self Generation Incentive Plan (SGIP) extends subsidies for user side distributed energy storage until 2026. The Better Energy Storage Technology Act (BEST) provides $1 billion in funding support for innovation in energy storage technology research, development, and demonstration over the next five years. In Germany, not only has the subsidy limit of 52GW of photovoltaic installed capacity under the Renewable Energy Law (EEG) been lifted, but the EEG tax paid by domestic power consumers for clean energy incentives has been reduced by 0.25 euros per kilowatt hour starting from 2021, and will be further reduced by 0.0625 euros by 2023. In Japan, the Ministry of Economy, Trade and Industry has allocated a budget of approximately 98.3 million US dollars this year to provide 66% cost subsidies for households and businesses installing lithium-ion batteries; In the UK, in addition to lifting the upper limit of 49 megawatts of energy storage licenses, a total of £ 1.246 billion "Industrial Strategic Challenge Fund" and "Net Zero Innovation Portfolio Fund" have been established to provide special assistance and support for energy storage technology.
Due to the gathering and leveraging of multiple competitive forces, global energy storage has entered a fast track of large-scale expansion. According to data, in 2021, the installed capacity of newly put into operation energy storage projects worldwide was 18.3GW, a year-on-year increase of 9%. By the end of 2021, the cumulative installed capacity of already put into operation energy storage projects worldwide was 209.4GW. According to research firm HIS Markit, the total installed capacity of energy storage systems deployed globally in 2022 will exceed 12GW. It is worth noting that in the global energy storage pattern, the three leading squares of the United States, China, and Europe are exceptionally obvious, accounting for 80% of the global energy storage installed capacity, and this trend will be further strengthened in the future.
(The author is a member of the China Market Society and a professor of economics)