Is Storage the Solution?

In the energy discourse we hear often that once the challenge of grid scale energy storage is implemented, wind and solar energy will be able to fully replace fossil fuels for generating electricity.

Instead of just staying at this philosophical level, let's make our homework.

This exercise is an oversimplification to illustrate the challenges of relying on intermittent sources for all of our energy.

Let's take Germany as our working example.

According to the latest report by the IEA (International Energy Agency), Germany consumed 551 TWh during 2013*. To convert this amount into average power we perform the following calculation:

     551 TWh / 365 days / 24 hours = 0.63 TW = ~63 GW.

The actual energy consumed by this country fluctuates hour by hour and seasonally. Germany tends to consume more energy in winter than in summer. However, to simplify, we'll make our numbers with the average power consumed.

Let's consider a solar capacity factor (CF) of 12% for this country (a little generous).

Also (and again with the purpose of simplifying our homework) we'll consider that every day of the year is exactly the same and thus that the daily capacity factor is equal to the annual one.

Thus, the installed solar capacity we would need is (considering 90% efficiency in the battery / inverter system):

     63 GW / 0.15 CF / 0.90 efficiency = 583 GW 

     (Today Germany has ~36 GW of solar installed capacity).

At the very least, the batteries would need to store 12 hours of power and this translates into:

     63 GW x 12 = 756 GWh

According to the Guinness Book of World Records 2013 edition, the largest battery in the world** (pictured below) can store 36 MWh. Thus, we would need this many to store 756 GWh:

     # Batteries = (756 GWh x 1000) / 36 MWh = 21,000

According to the Energy Information Administration (EIA), by 2040 global solar electricity production will be 452 TWh. This would be 82% of the 551 TWh Germany consumed in 2013 (and would "leave" nothing for the rest of the world).***

To calculate the required investment we need to multiply the cost of the solar watt (including inverters and installation) by 583 billion (see installed capacity above). Additionally, the cost of the storage needs to be added. We are easily talking here of more than a trillion euros.

However, these "rosy" numbers won't pass muster in the real world. Why? Because in the real world we have sunlight variations between days and, even more important, seasonality. Germany, for example, tends to consume more energy during winter when there is less sunlight.

Thus the above amounts would have to increase significantly. In other words, in real life we would need considerably more than the 583 GW of installed solar capacity and at the same time the batteries would need to store not 12 hours of electricity, but full days or even weeks. The required investment would thus be much higher than in the simplified case we presented above.

Conclusion: storage for renewable energy is not a silver bullet and it is doubtful that a fully renewable economy (solar and wind) would ever make sense in financial or even environmental terms.

Feel free to add to the conversation on Twitter: @luisbaram

Thank you.

Notes:

1. Sure, the renewable energy doesn't have to be 100% solar. We could have a combination of solar and wind. This would obviously make the exercise much more complicated but would make more sense in the real world. However, solar and wind are not fully complementary. Solar (obviously) operates only during the day. Wind is more random. See graph below for the first months of 2012 where we can see that solar / wind do complement themselves somewhat. We can see that in January there was little solar production but was a very good month for wind. Then, July was a very low month for wind but had substantial solar production. However February (a full month) was low on both. More storage would be required for compensating those long lulls. Additionally, February was the month with the highest consumption in the first 7 months of 2012. (If somebody can share the full year statistics, they are welcomed). Let's bear in mind that the randomness of wind can only be somewhat compensated by solar during the day, so for half of the year (nights) wind is by itself.

2. Another concern is the variability of wind, here we can see annual variations (solar is more stable although its CF is considerably lower than wind's in Germany):

Both graphs are from the last reference below.



References:

* http://www.iea.org/statistics/relatedsurveys/monthlyelectricitysurvey/

** According to the Guinness Book of World Records, this battery is "larger than a soccer field."

*** http://www.eia.gov/forecasts/ieo/

German capacity factors for solar and wind:
http://cf01.erneuerbareenergien.schluetersche.de/files/smfiledata/1/1/2/2/4/7/WindPVProductivity1to712.pdf

Renewables for Australia

Let's make our homework at what it would take to convert Australia to 100% renewable energy.* Not to make the exercise extremely complex, let's simplify it a bit by using only solar photo-voltaic (PV) in our calculations.

According to the IEA (International Energy Agency) Australia's electrical energy supply in 2013 was 228,152 GWh. To convert this to average power consumption we divide it by 365 and then by 24 to arrive at a figure of ~26 GW average power consumption.

If we consider that the capacity factor (CF) of solar PV in Australia is 20%, then the solar PV capacity that needs to be installed is:

26GW / 0.20 = 130 GW.  At $2 dollars per watt that would add up to $260 billion dollars (~$11,000 per person).

Let's also consider that at peak hours, Australia actually consumes 50% more than the average power and thus their typical peak consumption would be 26 GW x 1.50 = 39GW.

This means that, say, at noon in central Australia, we would have a surplus of 130 - 39 = 91 GW.

Thus, at many instances during the year most of the solar capacity would have to be disconnected to prevent destroying the electrical grid. This would mean that the effective capacity factor of solar would be considerably lower than 20% and thus more capacity would need to be installed but this would make the excessive production at many instances during the year even more problematic.

On the other hand and obviously, during the night there would be no energy production.

So, OK, by themselves the solar panels would not be able to supply the energy Australia requires but we can always use storage to smooth the power delivered.

Considering that in winter days are shorter let's add enough storage for 14 hours of the average consumption. That would be 14 x 26 GW = 364 GWh. 

Considering Tesla S grade batteries for the above, a total of approximately 2,330,000 tons of batteries would be required. The above would represent ~100 kgs per person. Sure, lithium batteries are among the lowest weight technology, other chemistries would be heavier.

According to IEA's latest electric vehicle report, the cost of this type of battery could reach ~$200 dollars per kWh by 2020. That would represent a total cost of ~$73 billion dollars. Sure, other chemistries might be less expensive. This would represent ~ $3,100 dollars per person. 

Adding the panels ($11,000) plus the storage ($3,100) gives a total of $14,100 per person. Sure, this is only the upfront investment. Every so many years the batteries would have to be replaced, as well as the panels. 

However, the above system wouldn't provide reliable electricity on an annual basis, as we know the insolation in Australia is relatively low from April to August. More storage would make it somewhat more reliable but the total cost would increase. 

Feel free to make your own calculations and share your comments if you get different numbers.

* We are considering only electricity which is a fraction of Australia's total energy consumption that includes fuel for transportation, for industrial processes, etc.

References:

http://www.iea.org/stats/surveys/elec_archives.asp

https://www.iea.org/publications/freepublications/publication/name,37024,en.html

http://www.teslamotors.com/fr_CA/forum/forums/model-s-battery-0

http://www.gaisma.com/en/location/sydney-au.html   (data for individual cities).

Solar is Cheaper than Ever

Several CEO's of solar companies were interviewed today in the WSJ to discuss the amazing price decreases of solar technology in the past few years.

First they began by stating that solar went from being among the most expensive energy sources to one of the least expensive.

At the beginning of their presentation they mention prices below one dollar per watt but then one of them corrects this information by stating that once installation, inverters, etc., are included the total price for a residential system is in the range of 4 to 5 US dollars per watt.

What was completely overlooked, however, was that on AVERAGE a solar installation produces power only 20% of the time (in a good and sunny place on Earth).  Thus for 80% of the time OTHER energy sources have to generate the needed electricity.

The above means that solar is always a surplus investment.  No matter how much solar is installed, we cannot remove any conventional generating capacity because aside from the obvious fact that at night there is no sun, a cloudy day can easily reduce the output of a solar installation by 90%.

Sure "if solar could be stored" the situation would be different, but here we have two issues:

1. Storage is extremely expensive and thus would drastically change the economic equation of solar.

2. We have to decide for how long we want to store it?  For a day? For a week? For three months? (Germany, the country with the most installed solar capacity has experienced its darkest winter in 43 years**).  Obviously, storage costs grow exponentially with the number of hours / days required to be stored.

If solar is somewhat viable today it is only because it almost fully depends on the conventional electrical grid to mask its intermittent nature. Furthermore, the costs quoted by the CEO's today do NOT include the additional costs the grid must incur to support the fluctuating nature of solar.

Conclusion: the money invested in solar could be better used, for example, in efficiency improvements and nuclear power.

** Spiegel: February 26, 2013.