Battery-Stored Electricity Is Getting Cheap
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- Apr 2, 2019 5:34 pm GMTApr 2, 2019 5:33 pm GMT
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The levelized cost of electricity from lithium-ion batteries has nose dived. According to recent report by Bloomberg New Energy Finance, electricity costs from battery storage have fallen 35 percent since the first half of 2018, and 76% since 2012. The analysis, which pulled from over 7,000 projects world-wide, places the current average price per megawatt-hour at just $187. Assuming the technology continues to become more affordable, battery stored electricity seems set to nudge out natural-gas-fired power plants–even without subsidies or incentives.
Somewhat surprisingly, battery LCOE has outpaced that of onshore and offshore wind. The cost of electricity from offshore wind sites has fallen 24 percent since 5 years ago, while onshore wind prices have decreased by just 10 percent in the same time frame. Of course, despite battery storage’s accelerated cost drop, the generation technologies are still more cost effective. In fact, by the end of this year, the megawatt-hour of onshore wind is expected to reach $50.
The news may be most significant for the future of systems that include both solar/wind and battery storage. Already, many such projects have been announced in 2019. Most notably, perhaps, is the 495-megawatt storage system set to accompany an equally large solar farm in Texas’ permian basin. The project was devised to help power the region’s burgeoning energy industry–an irony few publications could resist highlighting.
The trends underlined in the report could have serious implications for the coal industry. In fact, a different study by Energy Innovation and Vibrant Clean Energy claims that the LCOE of new renewables is already less than that of ¾ of the country’s coal fleet. And, of course, the battery side of this whole equation means the power can be provided whenever.
It’ll be interesting to see how some of the higher profile renewable/battery storage projects shape up in the coming years.