An NJBIZ article written by Randy Allen, Steve Socolof, and Shihab Kuran

Published July 13, 2020, Volume 33, Number 27

Access the article here

Holding on to power
Why storage is a crucial part of the state’s new energy vision

While everyone knows the fear of a phone dying in the middle of an important call, batteries usually enable us to enjoy all of our portable devices. It started with those AA batteries we would buy for our flashlights, then the AAA and cell batteries for remote controls and other devices, and, of course, the rechargeable batteries in our cellphones and laptops. In the automotive world, every car uses a starter battery for ignition. The technology of batteries has continued to advance, driven by needs for longer life, lighter weight, and other features important to each application.

The use of batteries to power electric vehicles started a century ago but accelerated in the 1990s due to a combination of federal and state environmental regulations as well as advancements in battery technology to allow for more range. Toyota introduced the first mass produced hybrid Prius in 1997. Tesla introduced its first roadster in 2008 with a 244 mile range.

The larger Model S now has a range of 400 miles. Since 2010, the battery cost/kwh has fallen by more than 90 percent while energy density – that is, energy per unit weight, or watt-hours/kg – has almost tripled. In 2015, more batteries were sold for consumer products than for vehicles. By 2019, vehicle demand for batteries was almost four times that of demand for consumer products.

The ever increasing number of consumer and automotive applications is driving down the cost of batteries and enabling new applications to become more economical. The next emerging area of significant growth for batteries and other forms of energy storage is grid applications.

Today, only 5 percent of New Jersey’s total electricity generation is from renewable sources. This is mostly solar with some biomass and wind. However, the 2019 NJ Energy Master Plan sets a goal of 100 percent of the state’s energy needs coming from clean energy by 2050. There are many pieces to hitting this target, but the state has mandated that 50 percent of its electricity should come from renewable sources by 2030. For example, 3,500 megawatts (MW) of offshore wind generation capacity is a part of this mandate. This figure represents 20 percent of today’s 18,000 MW of total electric generator capacity. Other elements of the energy master plan include electrifying the transportation sector, which, of course, will require a massive addition in charging capacity, and reducing peak demand on the grid.

Increasing reliance on renewables can be challenging because renewables are not always available. Obviously, solar depends on time of day, weather, and seasonality. Wind will also be variable in its energy production. The 9 MW of wind generation capacity installed today in New Jersey only generate electricity at about 30 percent of their rated energy capacity. Managing this variability in production coupled with efforts at peak shaving will drive new, significant demands for energy storage as a means of load balancing. Add to this increasing attention being paid to grid resilience – New Jerseyans are all too familiar with the risks and challenges of power outages – and we will find many reasons to want battery storage available at key points in our power network as well as for local use cases.

The Energy Master Plan does call for 600 MW of energy storage by 2021 and 2,000 MW by 2030, but there are no clear plans for achieving these targets. Further, PSE&G is seeking $180 million from regulators for battery storage projects, but this request has not been approved. There are good intentions, but this is new ground, and we need to start to put actions in place.

Other states like California, New York and Massachusetts are well underway in deploying energy storage. California has been the leader in the U.S. for battery energy storage deployments since their three major investor-owned utilities in the state. PG&E, Southern California Edison and San Diego Gas & Electric were mandated to procure 1.35GW of energy storage through the passing of Assembly Bill 2514. PG&E and SCE alone have recently awarded 423MW and 770MW of energy storage projects respectively. According to energy research and consulting firm Wood Mackenzie, the U.S. annual energy storage market is set to grow from 523MW in 2019 to 7.3GW in 2025, representing growth of more than 14 times in annual deployments. New York is providing about $400 million in incentives to reach grid storage goals by 2022.

As of today, the largest storage capacity facility in New Jersey is the 420 MW pumped hydro facility in Yards Creek. Pumped hydro is widely used due to its large capacity, simplicity and distinction as a commercially proven, grid-scale energy storage system. However, pumped hydro often uses large parts of a mountainside to create the elevation differences required to store hundreds of megawatts-hours of energy. The scale of pumped hydro projects leads to greater regulatory challenges that add years to the permitting process. These challenges, along with environmental impact concerns, have led to a greater push for new alternatives for long-duration energy storage. Although other gravity-based systems are being developed, long-duration lithium-ion batteries are currently the most common alternative, especially as costs go down. Flow batteries are also being developed as an alternative technology for long duration applications.

While there are national players, we also have some local entrepreneurial companies that are already working in the energy storage field.

Lightening Energy at Picatinny Arsenal in Dover and NJIT/Venture Link in Newark are developing advanced power/energy technologies that leverage a decade of work for the military. This work involved both kinetic energy harvesting and proprietary solid-state batteries. Commercial offerings have been centered on high-power batteries and smart systems that can charge more quickly, operate more efficiently, provide long service life and boost safety/security for electric mobility and grid storage. Lightening Energy also has a portfolio of technologies including fuel-cell based devices, technology to improve integration of batteries into the grid, and more energy efficient manufacturing automation systems, all of which will help Lightening Energy offer stronger grid solutions.

Power Edison in Watchung is focused on the development and management of utility-scale, battery storage systems. It provides stationary and mobile, modular, battery-based energy storage when and where required for land or marine based locations. Power Edison’s solutions offer the flexibility needed to address grid reliability or economic opportunities.

Eos Energy Storage in Edison is commercializing zinc hybrid batteries offering benefits like 100 percent recyclability and a wide operating temperature range that precludes the need for cooling. Eos has now run batteries for 10,000 hours in nine projects across three continents.

Gridless Power in Collingswood is developing battery storage systems for off grid applications like construction sites and emergency response where, for example, solar can be connected to a battery storage system to provide power at a site.

The four New Jersey energy storage companies above are providing unique value propositions within the energy storage industry. While energy storage installations have been slow, companies like these are ensuring that the longterm goals of 100% clean power remain viable and achievable. TechUnited:NJ (the former NJ Technology Council) and its Cleantech Alliance along with sponsor PSE&G are running a Clean-Tech Impact Challenge with startups solving for a clean energy future are invited to submit. Go New Jersey!

Steve Socolof is Managing Partner of Tech Council Ventures, where Randy Allen is a Summer Associate; Shihab Kuran is CEO of Power Edison.