As a record heatwave pushed California’s electric grid to the brink last week, the world’s most powerful lithium-ion battery was unveiled outside San Diego, showcasing a technology that could cut the risk of blackouts and aid the state’s climate goals.
LS Power’s Gateway battery has far more wattage than the Tesla-built Hornsdale Power Reserve in Australia, the previous record holder. Yet Gateway will soon be surpassed by even bigger projects in California.
Batteries could help the state reach zero-carbon energy targets that were called into question over the past two weeks as furious demand for air-conditioning forced grid managers to make brief power cuts. California has rapidly built up solar photovoltaic generation in the past decade, but the resource fades at sunset.
Batteries can store surplus solar energy at midday, discharging it in the evening. Grid operators have traditionally summoned natural gas-fired “peaker” power plants to serve this peak demand window.
“We’re building what I think of as the new type of peaker plant,” said Cody Hill, LS Power’s vice-president of energy storage. “This is dispatchable capacity that doesn’t have a smokestack.”
Gateway’s debut almost doubled California’s battery storage capacity. When it reaches full strength at the end of August it will be able to discharge 250 megawatts — 100MW more than Hornsdale after an expansion there is completed. One megawatt can serve about 750 homes in California.
A total of 648MW of battery capacity will be put in service in California this year and 1,112MW will be deployed next year, leading to 2,090MW installed by the end of 2021, said Helen Kou of BloombergNEF, an energy research group. The state’s three big utilities have already surpassed a state target to contract 1,325MW of storage capacity by 2020, according to the California Public Utilities Commission.
Governor Gavin Newsom ordered an inquiry into this month’s power crisis. Early analysis points to unexpected failures at gas-fired plants, seesawing wind power output and a lack of electricity imports from states also burdened by the heatwave. Steve Berberich, the chief executive of the California Independent System Operator, said that renewable energy was not a factor in the shortfalls.
Mr Berberich has said that as much as 15,000MW of battery storage would be necessary to help California meet a goal of eliminating carbon dioxide emissions from the power grid by 2045, replacing gas-fired generation in the evening hours. Mr Hill estimated that more than 10,000MW would be installed statewide by 2030.
The price of storage systems has dropped by 90 per cent in the last decade, said Dan Finn-Foley of Wood Mackenzie, a consultancy. Accounting for the latest cost declines, a paper from Lawrence Berkeley National Laboratory concluded that accelerating use of wind, solar panels and storage could achieve a “near-complete decarbonisation of California’s power sector by 2030” with cost savings or “minor cost increases”.
New York-based LS Power, founded in 1990, primarily owns gas-fired power plants. In 2018 it opened a 40MW battery in Vista, California, and the company has another 325MW of battery projects under way in the state.
“This is going to be a very long-runway business,” Paul Segal, LS Power’s chief executive, told the Financial Times. “We’ve been an opportunistic developer of renewable assets over the years. I think we’re probably going to make a more concerted, more programmatic effort in that area as we move forward.”
They are not alone. Elon Musk’s Tesla and the utility Pacific Gas and Electric last month started work on a 182.5MW battery in California’s Monterey county, featuring 256 Tesla Megapack units perched on 33 concrete slabs. Nearby, independent power producer Vistra is constructing 400MW of battery storage on the site of a gas-fired power plant, and has obtained permits to install a total of 1,500MW.
“We believe the market in California is showing a growing need, and that should bode well for future development — but we will see,” Vistra said.
Last week Swiss-based fund manager Capital Dynamics and Omaha-based energy company Tenaska announced plans to build 1,950MW of battery storage in the San Francisco, Los Angeles and San Diego areas at a potential cost of $2bn.
Benoit Allehaut, managing director in Capital Dynamics’ clean energy infrastructure team, said the amount of storage scheduled to come online in the next 12 months would have prevented this month’s blackouts.
“The situation would not occur. It’s plain and simple,” he said.
The extreme heat, with temperatures reaching 54C in Death Valley, has worsened California’s wildfires. Mr Allehaut said avoiding fires was one reason why his company’s new batteries would be located in urban centres, rather than remote areas where land is cheaper.
“Unfortunately, climate change is a reality. And climate change leads to fires. Fires sometimes hit transmission lines,” he said.
Lithium-ion batteries typically last about four hours before depletion. The Gateway project will be able to discharge its 250MW for just an hour at the start, though LS Power is expanding it to about three hours of capacity for next summer and eventually four hours, the company said.
The short duration makes batteries useful for peak periods but not for steady power. Speaking about blackouts last Monday, Mr Berberich said that “batteries won’t fix this alone”, and warned that solar farms would be unable to recharge them on cloudy days. “Solar and other renewables will have to be overbuilt to both charge the batteries and serve the load at the same time,” Mr Berberich said.
Kelly Speakes-Backman, chief executive of the Energy Storage Association in Washington, said that batteries could be recharged with electricity sources other than solar — for example wind power, which is sometimes discarded because of insufficient demand when turbines are spinning.
“This is not about matching storage directly to a resource. It’s about incorporating it, and incorporating flexibility, into grid planning,” she said.