Slide Heading
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ut elit tellus, luctus nec ullamcorper mattis, pulvinar dapibus leo.
Click Here
Previous slide
Next slide

Energy Storage Will Grow Quickly, NREL Report Says

April 25, 2022

by Peter Maloney
April 25, 2022

Energy storage deployments could grow rapidly in the coming decades, reaching between 130 gigawatts (GW) and 680 GW by 2050, enough to support renewable generation of 80 percent or higher, according to a new report from the National Renewable Energy Laboratory (NREL).  

The report, Storage Futures Study: Key Learnings for the Coming Decades, which is the seventh and final of NREL’s Storage Futures Study (SFS) series launched in 2020, argues that energy storage will likely play a critical role in a low-carbon, flexible, and resilient future grid.

“Each phase of the study has indicated a potential coming wave of energy storage, with U.S. installed storage capacity increasing by at least five times by 2050,” Nate Blair, principal investigator of the study, said in a statement. “Overall, we find energy storage offers significant value, from easier grid operations to fewer costly thermal start-ups to reduced emissions.”

Among the key findings, the report found that diurnal storage is economically competitive across a variety of scenarios that include a range of cost and performance assumptions for storage, as well as power generated from wind, solar, or natural gas. “Even the most conservative case represents a fivefold increase compared to the installed storage capacity of 23 GW in 2020,” the majority of which is pumped storage hydropower, the report’s authors said.

NREL’s modelling indicated that “significant deployments” of both renewable energy and energy storage could be deployed even without additional carbon policies, which, the authors said, demonstrates their increasing cost-competitiveness as resources for provision of energy and capacity services.”

And while “stacking” the functions that energy storage devices can perform, which runs from time shifting peak demand to avoiding new transmission investments, the ability of storage to provide firm capacity to offset the need for conventional generation to meet peak demand is “critical to realizing its full potential,” the authors found.

NREL’s models also showed that increased levels of energy storage deployment flatten the peak load curve and thus increases the amount of stored energy required to provide firm capacity and to continue reducing net peak demand. That could present opportunities for emerging technologies capable of longer durations, or even for the next generation of existing long-duration technologies such as pumped storage hydropower, the report’s authors said.

However, the report’s authors also noted that widescale electrification of heating could shift the peak load to the winter for much of the United States, which would create longer peaks that are more difficult to meet with storage and solar power. If that occurs, it could increase the value of wind generation and longer-duration storage, the report said.

And even though energy storage is highly competitive as a new source of peaking capacity without carbon dioxide mitigation policies in place, “it is important to recognize that technology or policy changes could affect the growth prospects of energy storage,” the report noted.

“Despite important modifications to regulatory frameworks over the past decade, storage remains a challenging technology to appropriately value and compensate, particularly in restructured markets,” the authors wrote. “If storage is not compensated fairly, it could result in nonoptimal storage deployment.”

The report also noted that flexibility will be key to decarbonizing the power sector at least cost and that will likely require a variety of resources, some of which may cost less than energy storage. “Establishing better characterization of demand response, flexible loads’ realistic contribution potential, and cost is critical to better understanding the opportunities for energy storage,” the authors said.

The Key Learnings report modeled hundreds of future scenarios and added new capabilities to NREL’s publicly available Regional Energy Deployment System (ReEDS) capacity expansion model to represent the value of diurnal battery energy storage. To simulate grid operations in the ReEDS scenarios, NREL used the commercially available PLEXOS production cost model. On the distribution side, NREL added new storage capabilities to its open-source Distributed Generation Market Demand (dGen) model to simulate customer adoption of solar-plus-storage systems under different battery and backup-power value assumptions.