Why add storage to solar?

Transcription

1 Why add storage to solar? Davion Hill, Ph.D. Energy Storage Leader, Americas NAATBatt Executive Board NY-BEST Board of Directors 19 May DNV GL May 2017 SAFER, SMARTER, GREENER

2 Storage added to Solar Increase overall PV capacity BTM vs. utility scale Peaker substitute with no fuel costs Stacking functions, adding revenue to PPA Policies: RECs and ITC Markets: capacity in California, tax credit in Maryland, subsidy in MA 2

3 A brief history of DNV GL in Energy Storage DNV invested in R&D to start battery testing development of Battery XT begins KEMA offering consulting and independent review of storage technologies KEMA offers performance and safety testing of batteries 2012 DNV acquires KEMA merges testing labs and wins ARPA-e AMPED 2013 DNV GL Publishes Storage cost effectiveness study for CA 1.3 GW mandate 2014 DNV, DNV KEMA, and GL merge to form DNV GL, BEST Test and Commercialization Center opens, DNV GL wins ARPA-e CHARGES 2015 First version of GRIDSTOR (RP-0043) published, DNV GL wins ARPA-e NODES 2016 DNV GL performs fire testing for Consolidated Edison, NYSERDA, and FDNY Battery Costs $1,200/ kwh $145/k Wh 3

4 Batteries 101 4

5 Generally increasing weight This is what it looked like even 2 years ago Application Dominant Sizing Factor(s) Appropriate Chemistries 4+ Hours Microgrid 2-4 Hours Peak shaving 1-2 Hours Demand charge and backup 1 hour or less Demand charge management Long duration and cost Long duration (high energy), low or mid SOC tolerance Energy and duration, calendar life Power, fast response, short cycle tolerance Most flow Flow batteries, ZnBr, ZnMnO 2 Pb Acid, Some Li-ion, flow batteries such as Vanadium Redox, ZnBr Most Li-ion 15 Minutes Frequency or voltage support < 15 Minutes Peak load reduction < 1 min Short peaks Power, fast response, short cycle tolerance High power High power Most Li-ion, LiFePO 4 LiFePO 4, some titanates LiFePO 4, some titanates, ultracaps Most Li-ion not considered for 2+ hours because of cost. kwh * $/kwh = system cost 5

6 Generally increasing weight This is what it looks like now Application Dominant Sizing Factor(s) Appropriate Chemistries 4+ Hours Microgrid 2-4 Hours Peak shaving 1-2 Hours Demand charge and backup 1 hour or less Demand charge management Long duration and cost Long duration (high energy), low or mid SOC tolerance Energy and duration, calendar life Power, fast response, short cycle tolerance Li-ion NCM, Most flow Flow batteries, ZnBr, ZnMnO 2, Li-ion NCM Pb Acid, Li-ion NCM, flow batteries such as Vanadium Redox, ZnBr Most Li-ion 15 Minutes Frequency or voltage support < 15 Minutes Peak load reduction < 1 min Short peaks Power, fast response, short cycle tolerance High power High power Most Li-ion, LiFePO 4 LiFePO 4, some titanates LiFePO 4, some titanates, ultracaps Low cost of Li-ion NCM makes it competitive for long duration. 6

7 Li-ion Chemistries 7

8 Battery Architecture 8

9 This is a cell Pouch - Usually Ah - Vacuum sealed - Polymer skin with sealed edges - CIDs less common Prismatic - Usually Ah - Vacuum sealed - Aluminum can with polymer seals on edges - CIDs, vent Cylindrical - Usually 1-4 Ah - May include CID or passive fuse - Under pressure - Metal enclosure with vents or etc. 9 CONFIDENTIAL

10 This is a Cell Spec Sheet Critical to warranty and performance guarantees! 10 CONFIDENTIAL

11 Technical Due Diligence 11

12 Why Test? What you get on the spec sheet Which comes from this duty cycle 12

13 Capacity What you actually need: Your system is doing this (actual profile) and your supplier has offered a guarantee for this. Years 13

14 Capacity The problem: THIS Years WAS MADE FROM THAT NOT THIS! 14

15 Capacity Using short term data to get a 12 month answer Balancing speed and cost Optimized duty cycle falls within warranty or guarantee Cycles, or years 15

16 Battery XT Your duty cycle, your project 16

17 Solar+Storage 17

18 Why add battery to solar? Does it just add cost? Solar peak not timed with demand peak. Demand peak addressed. 18

19 Can I increase the size of solar with a battery? Solar results in net export. Production not timed with demand peak. In this example, solar limited to 1.1 MW Demand peak addressed. Export avoided. Solar increased to 1.3 MW. 19

20 Why would you want to avoid export? Interconnection restriction PPA agreement Export limitation (total MW) Hawaii net metering ban (example of what is to come for states with high RPS) 20

21 Why would you want to increase solar size? More kwh sold Larger tax equity Put more capital to work More capture of RECs (in applicable markets) Commercial sites without footprint limitations 21

22 When does duration matter? Priority function: address peak between 17:00-23:00 2 Hour 8 Hour Priority function: capture solar energy to maximize ITC 2 Hour 8 Hour 22

23 Costs 23

24 Cost of Duration 2017 Cost rules of thumb: - Price floor of market ~ $500/kWh Li-ion system installed (2 years ago was $600- $700/kWh) - Flow batteries (ZnBr, Vanadium Redox) have been consistently around $500/kWh for several years - Other technologies claiming $100/kWh require field data to prove it Price is crossing over 24

25 Actual Prices We are here 25

26 Continue the 8-15% Projection Price floor in 2020: $100/kWh at the cell level $200/kWh at the system level Cost of 4 MWh today = $1.4M Cost of 4 MWh in 2020 = $800k $100 26

27 Why are we talking about cost so much? Automotive scale drives pricing down Battery demand only going up for last decade Likely trend in next ~5 years = PRICE 27

28 $/kwh vs. $/kw: Peaker Comparison Outputs (mean values) Peaker ESS Lifetime Cost ($) $203,665,653 $231,631,017 Hrs/y System Cost $54,152,000 $99,555,556 Installed CAPEX $81,228,000 $199,111,111 Turnkey $/kw $1,451 $3,556 Turnkey $/kwh N/A $1,067 kwh/y 40,880,000 40,880,000 Fuel Cost/y $2,555,087 $1,062,880 Energy (MWh) Permitting $877,333 $219,333 28

29 Peaker vs. Peaker (ESS vs. Gas) Based on todays prices Best case storage beats worst case Gas at year 7. Best case storage beats most likely case gas at year 12. Most likely case storage beats worst case gas at year

30 Sensitivity to Cost of Storage Power and duration affect cost top 3 sensitivity factors related to capital cost. ESS balance of system cost (BOS) is controlled by EPC Construction period affects BOS cost 30

31 Re-run the simulation with CAPEX $200-$400/kWh ( ) Starting next year ESS wins in all cases with worst case 7 year payback. This neglects additional opportunities! - Frequency regulation - Spinning reserve - Aggregation + Customer-sited benefits (demand savings) 31

32 Conclusion It s a race to the bottom! Lowest cost bankable ESS wins Peakers competitive in any market without policy RPS policy states will have strong storage markets Storage increases the buildout of solar Storage stacks value many opportunities for additional upside There are opportunities today that increase rapidly in next 3 years 32

33 Thank You Davion Hill, Ph.D. SAFER, SMARTER, GREENER 33