Introduction

In one of my articles titled “Wind-Solar hybrid: A perfect balancing act for 24 hours supply”, I wrote wind energy is available at night and solar at day. So, connecting them in a network and supply to the grid can ensure near stable grid input round the clock. The wind-solar hybrid system works based on this availability schedule. However, works best when added storage battery into it.

I also wrote, hybrid increases PLF (plant load factor) of the system. When individually the PLF of wind is typically 28% and PLF of solar is typically 18.7%, a hybrid wind-solar system can raise the PLF to a level of 41.8%.

True, that wind-solar hybrid can improve the PLF and can supply ‘near stable’ energy supply to the grid, but the requirement is a ‘stable’ grid. So to improve the ‘near stability’ of renewables, energy supply from other sources has to be injected into the system.

As of now, in India, it is being done by firing/ceasing the coal-based thermal power stations. Since India wants to gradually reduce the use of coal-base plants until reach ‘zero’ emission, there is a need to develop alternative sources other than coal.

We know that our electricity system is instantaneous. In this system, the electron produced at any given time is to be supplied to the grid and consumed instantaneously. There is no provision to delay or hold the electrons at any location of this system. 

Since it can not be stored in the producing machine or substation or the wire, the demand and supply have to be matched almost second by second.

Our present coal-based generation system allows this. As it is flexible, grid operators face no issue to add or curtail generation as per the demand. They turn ON or turn OFF the required number of power plants to balance the demand & supply.

Why Storage Battery

The weakness of wind and solar energy is that on a stand-alone basis its generation can not be timed with the demand perfectly because of its intermittency.

Therefore, while we are talking to shift from this old coal-based generation technology (to reduce emission) and shifting our focus to depend more on renewables, the existing grid balancing method should also not work.

Storage of electricity could be a possible solution for that. There are many kinds of storage technologies available to us- chemical, electrical, gravitational and mechanical- for that purpose. 

The use of gravitational technology is already present in some hydropower stations in India. 

However, while we talk about storage with wind and solar, we essentially look for a chemical storage system. Such as storage batteries.

Indian Situation

As of date, wind and solar jointly account for around 10% of the total electricity generation mix. Small participation comes from nuclear and biogas. Rest more or less 90% comes from coal-based power plants and hydro.

India has taken a target to increase this 10% to the range of 40% by 2030. The more the portion of wind and solar added to the grid, the more will be the effect of intermittency felt. India needs to have a feasible solution for energy storage in parallel.

Storage Batteries could be a possible solution in near future. As of now, it is not a commercially viable option. However, R&D is going on with full vigour to bring down the cost to an acceptable level.

Once storage battery is included in the energy supply network, it will make the electricity more flexible to handle in terms of grid stability and can make a balance between demand and supply.

For that the economics of the battery storage to be acceptable to the power sellers. The Levelized cost of energy (LCOE) has to meet the commercial viability of energy storage projects.

Battery Economics

Interestingly, the cost of the storage battery is rapidly declining in recent times. In 2010, a  LI (lithium-ion) storage battery pack was costing about $1200 per kWh and in 2020, the price came down to $137.

Today, by virtue of this price fall, the lithium-ion storage battery system is the world’s cheapest energy storage method. But still, a long way to go to be commercially viable.

As per Bloomberg research, the price of Lithium-ion storage batteries will keep on declining year on year at a rate of 8%. Price will come down to a level of $ 100 per kWh by 2023 and $58 per kWh by the end of 2030.

The moment the combined cost of wind, solar and battery storage falls lower than the cost of power generated from coal or gas-based systems, the electricity market can practically shift to 100% renewables.

Today, at a price of $137 per kWh, wind or solar plus storage battery systems have already become cheaper than fossil fuel-based energy in the US. In India, it is almost at per. So we are almost at the doorstep point.

It is expected, that the fossil fuel price will go up further in the coming years. And with that, if the battery price falls to the level of $58 per kWh by 2030 as projected, India can switch to 100% renewable energy mode (theoretically).

Bloomberg predicts that renewable – plus -storage will beat all new coal capacity in India earliest by 2025.

In my understanding, in general, storage batteries made of lithium-ion technology not be used for a utility-scale storage solution. It will mainly cater for the need for the EV sector. For utility-scale, some other storage battery technology might be used as a preferable solution. 

There are thousands of storage battery technology available today, for example, sodium-sulphur and lead-acid batteries. Or world’s cheapest energy storage battery could be an iron-air battery, as recently experimented and lauded by a Boston based start-up “Form Energy”.

Another start-up from Italy, “Energy Dome” is developing a ‘CO2 battery’ system as a long-duration storage battery. The company is confident to achieve a Levelized cost of storage (LCOS) of $50-$60 per MWh within the next couple of years. This CO2 storage battery could also be a preferable option in future.

Battery Dynamics in India

India does not have a sizable manufacturing planning till now. It has only a 01 GWh battery manufacturing plan in its portfolio, compared to China’s 850 GWh.

In addition to this, China controls 80% of the world’s raw material refining,77% of the world’s cell capacity and 60% of the world’s component manufacturing.

So, there is an urgent need for India for a  proactive step today. Else India will end up importing all its storage battery requirements from China in future.

India has a target to add 450 GW of renewables by 2030. As of February 2021, installed renewable capacity stood at around 94 GW.So, another 4 to 5 times growth is to be achieved by the renewable sector in the next nine years.

If 20% of this 450 GW is backed up by 2 hrs storage battery system, the demand for storage would be 180 GWh.

On the lower side, if 10%  of 450 GW of renewable capacity is considered to be backed up for one hour, it would require 45 GWh of storage battery capacity.

Let us consider a figure of 100 GWh in between this 45GWh and 180 GWh. This figure projects that for the next 9-10 years, there could be potential demand for renewable storage battery systems at a rate of around 10 GWh per year.

Demand and Supply Possibility

There are two clear ways out. Either make it in India or import from China. 

China is in a far advanced position in supply chain management for storage battery manufacturing. It has full control over almost all major sources of Lithium, Nickel and Cobalt across the world. These are the essential raw materials for battery making. It also has developed a huge manufacturing capacity of 850 GWh.

On the other hand, India has announced just 1 GWh of battery manufacturing capacity as of 2020.

Therefore, a lot of open ground is available to cover up as quickly as possible. Indian Government need to encourage to set up storage battery manufacturing factories in the country. They can initiate various incentives schemes(minimum rate of return etc.)for that purpose.

Government can also set up SEZ for battery manufacturing. 

Next is to ensure raw material supply for storage battery manufacturing. For that, the  Indian  Ministry of External Affairs(MEA) can start holding talks with the source countries (viz. Chile, Bolivia, DRC, Zambia, Indonesia, Philippines etc.) to ensure the availability.

Though, India has clearly missed the bus in the battery manufacturing sector, but still try to catch up with the pace. To do that immediately, a robust national-level strategy, as well as an execution plan, should be in place.

————————————————————————————————————————–

Reference: Sinha, S.(2020). Fossil Free. Harper Business.