Why are pumped storage facilities the financially viable options among power stations
Germany is encountering an issue of abundance: wind turbines and solar panels are producing more electricity than the country requires. The remedy is recognized, energy storage devours excess electricity. On windless days or in the evening hours, it dispenses the electricity. Presently, this role is primarily fulfilled by pumped hydroelectric storage plants. "They perform exceptionally well," declares David Taylor. Nevertheless, the founder of the liquid battery startup Unbound Potential lashes out at their potential in the "climate workshop" of ntv: "They induce substantial variations in mountain streams when they abruptly take up or release energy." Unfortunately, alternatives are scarce in Germany: "There are no incentives to generate income with innovative storage solutions," says Taylor. He advocates for a capacity market akin to Britain's and reveals why batteries' primary function is not storing electricity.
ntv.de: Germany is drowning in solar and wind energy. Frequently, so much renewable electricity is generated that the networks reach their limits. All that's missing are storage options and the energy transition is complete?
David Taylor: No. Additional grid infrastructure, battery storage, but especially a regulatory framework that offers power suppliers and other infrastructure service providers conditions to transition towards storage solutions is needed in Germany. Other European countries like Britain are much further along in integrating storage.
What do they do differently?
Britain depends heavily on offshore wind energy and has, consequently, commenced early in developing incentives for such solutions. For instance, there exists a capacity market. This would be a significant way to finance and secure large-scale storage systems profitably.
Why does it require a new market? Can't you just build large batteries next to every wind farm?
We need a market mechanism to generate income with batteries. The current power market can have substantial price fluctuations within a day. For a business that stores electricity when it's inexpensive and sells it when it's expensive, the margins are too thin and the currently available storage technologies are too expensive. This enterprise is not profitable. However, this is not the case with the capacity market: there, the ability to provide this on demand is already highly compensated.
Without this capacity market, isn't it not possible?
If there is a lot of wind or a lot of sunlight, there is a frequency shift in the power grid. The grid reacts extremely sensitively. To maintain grid stability, dynamic power sinks and sources like pumped hydroelectric storage plants are necessary: they can absorb power from the grid within minutes or even seconds when there is too much, or provide additional power. Currently, this role is primarily taken over by gas power plants. This mechanism is essential for a stable and robust supply; it plays a much more significant role than storing large amounts of energy. That's why the balancing service on the capacity market is well compensated.
And in the new power grid, ideally, batteries will take over this role?
Indeed. Pumped hydroelectric storage plants perform exceptionally well, but they induce considerable water level fluctuations in mountain streams when they hastily discharge a substantial amount of power or suddenly cease water flow. This has severe environmental and habitat consequences. As a result, even in regions with strong gradients, alternative methods are being sought to rapidly absorb and release power; if there is no strong gradient, then even more. Current battery technologies, however, need to be cooled, controlled, and linked. This periphery that grows with the storage system and is installed around it is too costly.
But aren't huge capacities already being constructed in California, Texas, or even China because battery technologies are becoming extremely affordable very quickly?
I'm delighted by that, but the existing technologies will not be applicable for large-scale stationary energy storage. Presently, the storage capacity scales linearly with the number of installed battery cells: the more energy I wish to store, the more cells I must construct. Each cell is a separate unit, so for a massive storage system, I have no alternative but to link them. However, each cell necessitates a temperature control system, a controller, and so on. That costs!
Aren't the battery cells actually the smallest cost factor?
Yes. There are not many mature technologies presently, but there is much innovation and numerous promising ideas. This includes our membrane-free liquid battery, but also electrochemical storage systems. Other companies are working on gravity batteries that work like giant elevators. Additionally, there are hydrogen or power-to-gas systems - various means to store energy on a large scale. The advantage of all these technologies is that I can scale the energy storage independently of the number of cells. This independent scalability is the defining characteristic of a stationary storage system. If that's not the case, we'll never be able to operate cost-effectively.
So we're still at the very beginning of large-scale storage solutions because the investment hasn't even paid off yet?
That's correct. All major German energy providers are now interested in storage technologies because it's predictable that they will. A pioneer is Leag in Lusatia. It's a substantial lignite company that is now installing a lot of battery storage capacity. However, many energy producers are in state ownership. They tend to be quite risk-averse when it comes to embracing new technologies. They only do this when there's a regulatory framework that makes it necessary. And that's happening now.
David Taylor was interviewed by Clara Pfeffer and Christian Herrmann. The conversation was modified for improved understanding and clarity. The full conversation can be heard in the podcast "Klima-Labor".
Germany should explore alternative energy storage solutions beyond pumped hydroelectric plants, as they can significantly affect mountain streams. Economic incentives are necessary to encourage the deployment of innovative storage solutions.
Batteries, while expensive and requiring careful management, have the potential to replace pumped hydroelectric plants as dynamic power sinks and sources, as they can scale independently of the number of cells and do not induce severe environmental consequences.
