Planned German storage incentive criticized

The political regulation of electricity and storage markets, and technical developments need to go hand in hand. These words came from Imre Gyuk, Energy Storage Program Manager in the Office of Electricity Delivery and Energy Reliability in the U.S. He was speaking at the Energy Storage conference organized by Messe Düsseldorf and Solarpraxis AG.

"The field is technologically new," he added. Gyuk has had a part to play in the financing of 20 demonstration projects in the U.S. over the last years. The interest in the industry is huge. The government has allocated US$185 million; the industry added another $585 million.

A part of storage does pay off, as Gyuk added. In the U.S., most storage projects are in operation to adjust the fluctuations from wind power and to stabilize the grid. In certain parts of the U.S., only 10% of wind energy is available when it is needed the most, at midday. In one project, a 25 MW storage system is used to cover the supply bottlenecks for three hours. This way, as Gyuk added, the battery storage option is cheaper than back-up systems that use oil or gas.

Another worthwhile storage application would be for grid frequency regulation. This has been realized with the use of flywheels. Nevertheless, it lies in the hands of political regulation if the systems pay off.

In this case, the U.S. Department of Energy would have to start the demonstration project before the regulation is adapted and the network services get paid. The keyword now is "pay for performance". In Gyuk’s experience, it has always been the case that pilot projects test the ground so that regulations can be developed. One cannot wait for regulations to come first.

Smaller storage systems

For the smaller storage systems, that can also be combined with PV plants, the Department of Energy has turned to lead-carbon technology. This technology, according to Gyuk, has the potential to have a 5- to 10- times higher lifetime compared to lead-acid batteries.

Gyuk finds storage systems extremely important. "Each non-buffered system can easily collapse, even more when it is bigger," said Gyuk. The vulnerability of large systems was shown by the 2003 blackout in the U.S., where 55 million people sat in darkness. In India, the more recent blackout cut 670 million people from power.

The scale of storage, and the point from which storage systems are necessary for wind and solar systems remain debated topics. Eicke Weber has presented a scenario where about 200 GW of PV and 200 GW of wind energy is installed in Germany. There are very few hours in Germany where more than 60 GW of power is necessary. The remaining energy has to be then stored.

Hildegard Müller, Head of the industry association BDEW, sees the need for storage systems only between 2020 and 2030, when the percentage of fluctuating energy sources reaches the 40-50% mark. She also gives food for thought with the statement that in 2020, in principle, only 0.1 TWh of storage capacity is necessary. If the grid expands, then this necessity can also rise up to 40 TWh.

Nevertheless, she remains wary about the planned storage incentive program proposed by the German Environment Ministry. It is supposedly not technology-neutral and the grid operators have not been involved. She added that in order to maximize economic efficiency, there needs to be competition amongst the options. Flexibility is the new value.

Translated by Shamsiah Ali-Oettinger