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How storage bridges the gap between supply and demand

Battery storage systems are at varying states of cost-competitiveness, and scientists are trying to improve quality. Photo courtesy of Portland General Electric Company via Flickr, all rights reserved.

But even mature technologies, both electric and thermal, are struggling in today’s energy markets.

2 May 2014

Energy storage technologies – including systems large and centralised as well as small and distributed – can bridge the gaps between energy supply and demand. Their uses are not limited to supporting variable renewable generation. Rather, they can help to optimise many parts of the global energy system.

Storage systems have potential application across the electricity grid, in dedicated heating and cooling networks and in off-grid applications. By setting aside energy for use when and where it is needed, energy storage – both electricity and thermal (for heating and cooling) – can decouple supply from demand, increasing system flexibility and improving reliability.

Storage systems can be defined by how long they can store energy, from systems that hold solar power from the day for use at night to seasonal systems that save summer heat to warm homes in the winter. On the shortest-term basis, electricity storage systems can shift supply and demand within an area to correct load imbalances, avoiding brownouts and blackouts. In the case of a blackout, storage can supply “black start” capabilities, which are used to initiate a restart without having to pull electricity from the crippled grid.

Electricity and thermal storage technologies currently exist at widely varying stages of development and cost-competitiveness. But even cost-competitive technologies face difficult regulatory and market conditions that hinder deployment, and many other technologies require more investment, research and development to increase performance and lifetime while reducing cost. A new IEA Technology Roadmap presents recommendations to make sure that economically viable technologies are compensated for the many services that they can supply. It also provides timelines for targeted investment to help less competitive technologies reach the deployment stage.

Promising technologies for electricity

In electricity storage, pumped storage hydropower (PSH) represents the vast majority (99%) of installed electricity storage capacity.

Overall, PSH, compressed air energy storage (CAES) and some battery technologies are the most mature, with flow batteries, superconducting magnetic energy storage (SMES), supercapacitors and other advanced battery technologies at much earlier stages of development.

Three storage technologies – PSH, CAES and a generalised battery storage system – are featured in the modelling framework of a Department of Energy study that evaluated the potential for the United States to transition to up to 80% renewable electricity supply. The results showed that increased storage needs would rely primarily on CAES technology.

Both PSH and CAES have significant potential in the energy system, utilising water and air as storage mediums. PSH involves using electricity in low-demand periods to pump water; subsequently, during periods of higher demand, this water flows back through turbines. CAES uses the same principle for compressing air in canisters – or even subterranean spaces – and subsequently heating it up using natural gas or another thermal resource. But both of these large-scale storage technologies struggle at times with siting and financing questions, given their system sizes and specific topographic requirements. Big PSH facilities (gigawatt-scale systems) exist around the world, while the United States and Germany are home to the only two CAES facilities in commercial operation.

The Technology Roadmap: Energy Storage suggests assessments for PSH and CAES over the next six years, including analysis and cost estimates for potential sites and upgrades to existing installations. Retrofits for PSH and CAES could take up to two decades: for PSH they will allow technology upgrades that will improve service capabilities and enhance system efficiency, while better compression and use of previously wasted heat can help CAES recover nearly 70% of the energy stored. Germany has already started work on an underground adiabatic CAES facility using a salt formation; it plans a second underground site this year that will also recycle the heat generated during compression upon release. This recycling could reduce or eliminate the need for natural gas.

PSH, too, is going subterranean, as underground reservoirs provide a promising option for efficient and cost-competitive smaller-scale electricity storage: a well is drilled that allows water to be pumped from a reservoir to another one closer to the surface or to a man-made aboveground holding area before being drained back down through turbines.

Battery storage systems abound at varying levels of cost-competitiveness. Scientists in the United States and elsewhere are working to improve conventional lead-acid batteries for large-scale fast-response storage, while German researchers are among those testing demonstration projects for high-efficiency lithium-ion batteries similar to those used on much smaller scales in laptop computers and electric vehicles. Sodium-sulphur systems are in place in Japan and the United States: in Texas, an installation of 80 modules, each weighing 3 600 kilogrammes, provides voltage regulation and has delayed a city’s need to upgrade ageing transmission infrastructure, as the battery system’s cost was less than replacing power lines that are frequently exposed to lightning strikes. More experimental are supercapacitors and SMES, with supercapacitors having far greater power density than regular batteries and SMES using extremely cold temperatures to gather, hold and release electricity with minimal loss. The IEA sees 15 more years of concentrated research to improve those technologies to commercial levels, with further gains later.

Getting warm on thermal applications

Besides electricity, thermal storage is increasingly common and valuable, with large-scale forms stockpiling energy to provide cost-competitive heating and cooling supply for buildings and industry around the world. Thermal storage systems also can be used to reduce heat waste from industry, electricity production and other activities.

Large underground thermal energy storage systems are already used for space heating in many developed energy systems. Canada, Germany, the Netherlands, Sweden and other countries are home to systems that use aquifers or man-made boreholes to store heat during the summer months for use in the winter; in Canada, this type of thermal storage system is supplying approximately 95% of winter heating needs for Drake Landing Solar Community, a section of Okotoks, Alberta, near Calgary.

On a much smaller scale, ice storage is cooling commercial and residential buildings in countries including the United States, Japan and China.

France relies on thermal energy storage in residential electric water heaters to cut about 5% of the country’s peak electricity demand in winter. More than one-third of French households use “two-period meters” that allow grid operators to remotely delay replenishment of hot water by minutes or hours.

The need to know more

One impediment to market assessments and forward projections is the lack of comprehensive data on energy storage, complicated by unsupportive market design and a absence of transparent energy price signals.

An even greater cipher is the upper limit for storage. A lack of comprehensive accessible data as well as conflicting viewpoints regarding what should be included in the baseline make it hard to compile an accurate global estimate. Many of the existing data sets for electricity do not systematically include information on both power and total storage volume, and missing data make it incredibly difficult to calculate the practical potential for off-grid systems.

For thermal storage, the absence of a comprehensive inventory of waste heat and the corresponding potential demand for this heat has slowed deployment. An IEA collaborative on combined heat and power plus district heating and cooling is filling the gap, but the initiative will require several more years of concentrated work.


This article by Melissa C. Lott, lead author of the Technology Roadmap: Energy Storage and until recently an IEA analyst, appears in the new issue of IEA Energy: The Journal of the International Energy Agency.  The IEA produces IEA Energy, but analysis and views contained in the journal are those of individual IEA analysts and not necessarily those of the IEA Secretariat or IEA member countries, and are not to be construed as advice on any specific issue or situation. Click here to read the new and earlier issues of IEA Energy, and click here to send a request a free subscription. Click here to download the Technology Roadmap: Energy Storage for free.

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