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Drastically Falling Costs for Batteries Challenge Fossil-fuel Generation

image credit: Image used with permission.

Bloomberg New Energy Finance (BNEF) is reporting that the benchmark cost for lithium-ion batteries has fallen 35% since the first half of 2018. This trend continues significant cost declines for batteries which, when combined with renewable resources, as Bloomberg first reported in 2018, are challenging the role of coal and gas.

According to Elena Giannakopoulou, head of energy economics at BNEF, the cost improvement in lithium-ion batteries is striking. “Looking back over this decade, there have been staggering improvements in the cost-competitiveness of these low-carbon options, thanks to technology innovation, economies of scale, stiff price competition and manufacturing experience,” she said. The cost of lithium-ion battery storage has dropped by 76% since 2012.

When batteries are co-located with solar or wind in solar-plus-storage or wind-plus-storage projects, they are starting to compete, in many markets and without subsidy, with coal- and gas-fired generation for the provision of ‘dispatchable power’ that can be delivered whenever the grid needs it (as opposed to when solar and wind conditions are ideal for power production). The cost of lithium-ion battery storage has dropped by 76% since 2012.

Up until now, gas-fired power plants have been the mainstay for meeting peak electricity demand, but now batteries are able to challenge gas peaking plants, according to the new Bloomberg report.

Giannakopoulou also remarked that onshore wind and solar PV continue their downward price trend with the LCOE declining by 10% and 18%, respectively, to $50/MWh and $57/MWh compared to a year ago.

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Discussions

Bob Meinetz's picture
Bob Meinetz on May 9, 2019 9:32 pm GMT

Lili, you do realize the vast majority of U.S. grid battery installations are charged by natural gas plants, wasting 10-20% of the energy in storage as resistance losses and bi-directional inversion?

Batteries make energy even dirtier than coming straight from a gas plant. When they're charged by wind or solar farms, they cut the effectiveness of already-ineffective renewables by 10-20% in the process.

Matt Chester's picture
Matt Chester on May 9, 2019 10:59 pm GMT

I can't help but think of the argument a few years back that "electric vehicles emit just as much CO2 per mile when you charge them because of the coal on the grid"

The numbers backed these facts up at the moment, but ignored the fact that those numbers were trending in the other way and there's immense value in laying the groundwork now for what will be valuable clean energy tools in the near and long term future

Bob Meinetz's picture
Bob Meinetz on May 10, 2019 1:01 am GMT

Matt, when natural gas generation is stored, and turbines cycled on/off to accommodate variable renewables, what comes out of the plug is just as dirty as coal generation, if not worse.

"US energy-related greenhouse gas emissions rose in 2018 by 3.4 percent..."

Whatever we're doing, it ain't working (cue chorus of excuses from renewables evangelists: "fossil fuels get so much more in subsidies...nuclear plants are bombs waiting to explode...by 20XX storage will fix everything...blah, blah"). Time to put the toys away, and bring out the power tools.

Joe Deely's picture
Joe Deely on May 10, 2019 4:08 pm GMT

The fossil fuel propaganda is becoming more and more blatant.

Matt, when natural gas generation is stored, and turbines cycled on/off to accommodate variable renewables, what comes out of the plug is just as dirty as coal generation, if not worse.

Most new batteries are being co-located with renewables - primarily solar installations. These batteries will be charged at midday when electricity prices are extremely low due to excess solar - sometimes negative.  Economics 101.

"US energy-related greenhouse gas emissions rose in 2018 by 3.4 percent..."

Of course the relevant statistic when talking about electricity generation is how much did CO2 rise in that sector - not the entire entire sector.  Making the data fit the story - true sign of propaganda.

US electricity related CO2 emissions rose by 1.15% last year while total electricity generation tose by 3.56%.  The rise in generation was almost totally weather related.  The electricity market continues to generate less CO2 per unit of generation.

If weather is more "normal" this year electricity related CO2 emissions will continue their decline. The coal portion of chart below will drop below 200 MMT by 2030 while NG wll rise to near 800.  In other words a drop from current total 1,750 to 1,000 MMT.  

Time to put the toys away, and bring out the power tools.

So, we can continue to do what has been working and drop CO2  another 750MMT by 2030 or we can do as Bob says:

Stop implementing renewables and NG to replace coal and pretend that nuclear projects will magically appear. Plus these nuclear projects will magically be finished in 1-2 years vs the current 10-15.

Nuclear has provided ZERO help in reducing CO2 emissions in the US over the last decade and will provide ZERO help over the next decade.

Time to call out the propaganda and implement MORE not less renewables.

 

Bob Meinetz's picture
Bob Meinetz on May 11, 2019 12:35 am GMT

Sorry Joe, missed "weather" in the chorus of excuses. Can I add baseless predictions: "nuclear will provide ZERO help over the next decade," "nuclear must magically be finished in the next 1-2 years to help in the next decade"? What about blatant falsehoods: "most new batteries are being co-located with renewables"?

So much in the renewables misinformation library from which to choose!

Joe Deely's picture
Joe Deely on May 10, 2019 6:35 pm GMT

Bob,

The problem is you can't show me ANY indication that Nuclear in the US will move above the 800 TWh trendline that it has been stuck on for more than a decade.  You got nothing. 

Luckily for the US, propaganda in support of coal is not stopping renewable and NG projects from being built. Coal is shutting down and CO2 is being lowered. Facts.

That said - the fossil fuel industry propaganda is probably slowing down the rate of renewable implementation and the rate at which we could be lowering CO2. So you got that going for you.

Bob Meinetz's picture
Bob Meinetz on May 12, 2019 6:46 am GMT

Why would gas vendors target their new BFF renewables with propaganda? They could be methane's ticket to profitability for decades to come:

ExxonMobil signs 250MW Texan solar PPA
Shell Solar - Investing in the Future
BP Solar: Global Market Leader in Solar Energy

etc etc etc.

Keep saying "you got nothing" while you can, Joe. NuScale's NPMs are one decade away from relegating solar and wind to permanent exhibits in the Museum of Energy Mistakes:

UAMPS At Vanguard of NuScale's Relentless March Towards Commercialization

Joe Deely's picture
Joe Deely on May 12, 2019 5:49 pm GMT

Sounds very similar to the recent propaganda from Exxon.

You said:

NuScale's NPMs are one decade away from relegating solar and wind to permanent exhibits in the Museum of Energy Mistakes

From Exxon:

Exxon Mobil to invest up to $100 million over 10 years with DOE on R&D of lower-emissions technologies

Across the Atlantic, U.S. supermajor Exxon believes that the answer to climate change risks is to invest in research and development (R&D) in finding yet-to-be-discovered comprehensive and scalable solutions that would mitigate global warming, rather than putting money into wind and solar farms.

So Exxon announced this week that it would invest US$100 million over ten years to research and develop advanced lower-emissions technologies with the U.S. Department of Energy’s National Renewable Energy Laboratory and National Energy Technology Laboratory

Both versions of this propaganda try to convince readers  to stall for ten years when current solutions do exist and are working.  

The US electricity market in ten years will be one where coal is almost non-existent.  The market will be divided between NG and zero carbon sources - hydro, wind, solar and the remaining Nuclear.

The NG industry has long had to compete with Coal and nuclear. However, with coal gone and Nuclear viewed as a has-been the NG industry knows that the real future competition are dirt-cheap renewables and storage.

States like CA, NV and NY which have are on the brink of eliminating coal have already started to replace NG based electricity with renewables.

If Nu-Scale is to be successful they will have to compete with NG based generaton.  If there is some sort of carbon price then they stand a chance.

Note- remaining nuclear will be 10 years older by 2030. Perhaps they can also gain some sales by replacing some of the lost generation as old nuclear retires. Decent-sized market.

As for competing with dirt cheap solar/wind/storage. Doubt it.

 

Matt Chester's picture
Matt Chester on May 12, 2019 7:14 pm GMT

To add on to the 'delay 10 years' point you make, Joe, I'd point out that the notion that in 10 years small modular reactors will change the game (which they very well could, and I'd be quite happy to see!) doesn't create a solution for what we should do today or during that 10 year period. If last fall's report from the IPCCC is to be believed, waiting for this silver bullet a decade now will still cause too much damage to the climate in the meantime-- so embracing solutions that are making important differences now is still critical

Bob Meinetz's picture
Bob Meinetz on May 15, 2019 11:51 pm GMT

"If last fall's report from the IPCCC is to be believed, waiting for this silver bullet a decade now will still cause too much damage to the climate in the meantime-- so embracing solutions that are making important differences now is still critical"

Matt, the average lifetime of a natural gas plant in the US is 43 years. Because banks would never offer financing on a $1 billion gas plant if it's going to be shut down ten years later, nor would shareholders approve such a loan, it's obvious both banks and utilities are in gas for the long haul.

Joe's belief gas companies will take out bad loans to help the environment is incomprehensible, and a quintessential example of the blind faith driving pro-renewables evangelism. Exxon-Mobil, Shell, and Chevron count on ongoing, irrational support for renewables to keep gas profitable indefinitely and maintain climate "targets" forever out of reach.

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