Why energy storage is (not) a dead-end industry

Energy storage industry experts respond to the damning report on energy return on investment from IFK Berlin. Photo credit: Airlight Energy, CSP thermal energy storage
Energy storage industry experts respond to the damning report on energy return on investment from IFK Berlin. Photo credit: Airlight Energy, CSP thermal energy storage
Energy storage industry experts respond to the damning report on energy return on investment from IFK Berlin. Photo credit: Airlight Energy, CSP thermal energy storage

Energy storage industry experts respond to the IFK Berlin report on energy return on investment (EROI) for renewable energy. Photo: Airlight Energy, CSP thermal energy storage

Is investment in energy storage worth the effort? Didn’t we find out last week that our industry is going nowhere because of the fundamental constraint of its energy return on investment (EROI)? Perhaps we had better take another look, just to be on the safe side.

First off: let’s not panic. While EROI studies point to a possibly critical problem in relying too heavily on energy storage for renewable power generation, the effects, if real, are presumably only likely to kick in at relatively high levels of penetration.

We are a long way off that yet. Meanwhile, there is the fact that the science around EROI, while apparently robust, is still relatively immature and clearly evolving, as indeed are the technologies and manufacturing processes being described.

This potentially implies uncertainty around current EROI assertions and predictions.

Certainly, most sector professionals consulted by Energy Storage Report had few qualms about dismissing the research: “BS” and “hokum” were among the terms used by knowledgeable industry insiders.

Some observers question the impartiality of parts of the research to date.

In particular, it is noteworthy that the authors of the important Weißbach paper, which gives nuclear power a clear EROI advantage over other energy sources, are all members of the German Institute for Solid-State Nuclear Physics.

Biases in data

Among other activities, the Institute is promoting a new nuclear reactor model. In theory, of course, any biases in the authors’ data and analysis will have been picked up during the paper’s peer-review process prior to publication.

Nevertheless, even if biases were not consciously introduced there is clearly scope for errors arising from a lack of knowledge of generation technologies outside of nuclear.

Weißbach admits to Energy Storage Report that all technologies should experience improvements over time and “the errors of our data could be in the order of 10%.”

But while Weißbach et al calculate an EROI of 3.9 for solar PV, Josefin Berg, a solar power analyst with IHS, reports: “Colleagues here say that it takes one year of a module’s electricity production to pay back the electricity spent on manufacturing.”

She cautions: “I don’t have any hard evidence. And like everything, it depends on how you look at it.”

However, Younicos spokesman Philip Hiersemenzel also believes the figures used in the study echo now-discredited early claims about PV’s carbon cost.

The net result

He also says: “Of course, storage doesn’t produce energy at all. But neither do substations or power lines. Storage is just part of the grid. You need to add it all together and then see if the net result is positive, which it is.

“There is just so much renewable energy on this planet that as long as their net energy is just a little positive we can just ‘overbuild’ to cover all of our needs.”

Giw Zanganeh, head of Energy Storage Technologies at Airlight Energy, contends that the comparison between emerging renewable energy sources and established generation industries such as gas and nuclear is not really fair.

Renewable power generation and storage “might be energy intensive right now,” he says.

“But once you have had an initial investment, just like there has been for nuclear and fossil, the energy that you need to create all these facilities per kilowatt-hour will go down. It’s like comparing a toddler with an adult.”

Another point Zanganeh raises is that even a nuclear-only power supply would in practice require some form of storage since reactors cannot easily be ramped up or down to meet demand.

Pumped hydro stores

For instance, he says, Switzerland currently benefits from cheap night-time nuclear offloads from France to create pumped hydro stores that can later be sold to Italy or Austria.

Zanganeh also takes issue with studies selecting renewable energy installations in less-than-optimal locations, as is the case with PV in Germany.

While this may be representative of current market dynamics, it is far from clear how improved localisation will affect renewable energy cost and EROI in future.

This week, for example, news emerged of a proposal to ship concentrated solar power with thermal energy storage from Tunisia to the UK.

While the EROI for this project is unknown, it will be “cheaper than nuclear, applying a lot of the same terms and conditions,” says Daniel Rich, chief operating officer at Nur Energie, the developer.

Where does all this leave us? For a start, while it seems likely the gloomy EROI figures emerging from current studies could improve significantly over time, it still makes sense to treat this work seriously.

Large-scale viability

In particular, the limited lifetime and cycling characteristics of today’s battery technologies clearly raise doubts over their large-scale viability not just from an EROI perspective but also commercially.

Given their cost (in financial terms), commentators such as former Axion Power director John Petersen have questioned whether batteries should be used for anything other than high-value power applications such as frequency regulation.

In contrast, energy storage systems with favourable EROIs, such as pumped hydro, look likely to offer better financial returns for grid-scale ‘heavy lifting’ duties such as load shifting (assuming the grid model survives in its present form into the future, of course).

And Zanganeh believes the compressed air energy storage systems that his company, the Airlight subsidiary Alacaes, is working on could even outgun pumped hydro on EROI and economics.

What this hints at, unsurprisingly, is the need for a balanced approach to low-carbon power generation.

“You will be looking at a portfolio solution,” believes Richard Heap, executive analyst at the Energy Research Partnership in the UK, “so some carbon measures may be a bit more challenging energy-wise.”

A portfolio of measures

He continues: “I also think that energy storage is just part of a portfolio of measures to manage variability.

“If you can get smart systems to work then you could include demand-side measures, ongoing use of a gas grid and also conversion of electricity to hydrogen which you could then use for transport.”

All these options would need further analysis, Heap says. And that is arguably the main value of EROI studies at the moment.

Given the vast array of new renewable and storage technologies currently under development, it is only right and proper that all future energy routes are examined exhaustively, and not just from a strictly commercial perspective.

After all, fossil fuels seem fine if you leave energy security and climate change out of the equation. Nuclear looks OK if you ignore accidents and what to do with the radioactive waste.

So who knows whether there may be unforeseen consequences in our current attempts to build a carbon-free future?

Says Zanganeh: “In markets like energy storage, where there is a lot of hype, you need to have the kind of inputs that make everybody think. It’s good to create this kind of controversy, to make people think about it a bit more.”

Written by Jason Deign

1 Comment on "Why energy storage is (not) a dead-end industry"

  1. One key issue often overlooked in this type of rationale is the amount of carbon we get still emit before we reach the >66% chance of surviving the still tolerable 2 deg C average increase. If we don’t take into account the likely massive amount of GHG we will emit over and above the current levels just to decarbonise, we may well blow billions of dollars and still fail in the task. Even on present business as usual levels we may have less than two decades before we reach limit. As most new wind, solar, hydro, storage, nuclear etc. will imply use of additional fossil fuels hence GHG we need to account for the resultant GHG as much if not more than the dollars. i.e. Emissions benefit as well as cost benefit – analysis.
    True there is much variation and bios in some EROI (and ESIO) presentations and there needs to be a standard best practice approach incorporated. Argonne National Laboratory’s GREET software (https://greet.es.anl.gov/ free download) maybe a good place to start.
    Efficient storage of some nature must be evolved if we are to depend on variable RE such as wind and solar but some types will be up front energy hungry and will require replacing regularly much to the delight of the stakeholders.
    Re the comment on ‘fossil fuels seem fine if’ has anyone ever worked out the amount and toxic contents of coal fired solid waste over a plant’s lifetime? We have and it is truly staggering. See our free download at http://www.energychallenge.info The window below will not accept this URL

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