Efficient energy storage to meet varying demand could be the key to delivering sustainable energy to buildings as the UK works to reduce its carbon emissions, say Richard Hill and Adam Mactavish of Currie & Brown
01 / Introduction
Achieving the UK’s Climate Change Act 2008 goal of an 80% reduction against 1990 levels in carbon emissions by 2050 will require radical decarbonisation of the energy used to power and heat our buildings. Although there is the potential for greater use of low-carbon fuels such as biomethane or hydrogen, it is highly likely that electricity will become the main source of energy used to provide both heating and transportation in addition to power. While nuclear will form a component of the energy supply mix, it is expected that the contribution from renewable energy will continue to increase to meet a large portion of demand.
There are two acknowledged strategic issues associated with increasing the proportion of renewable energy supplied to the built environment:
- Because of the intermittent nature of renewables, they cannot be relied upon alone to meet an electricity demand that also varies.
- The impact of moving the heating of our built environment to electricity would need to be able to respond to the large peaks in demand for heating energy during winter months that are much higher than current electricity demand peaks (see figure 1).
It is true that the improved efficiency of electric heating systems, for instance via the use of heat pumps, would reduce the peaks in demand, while smart systems and time-of-use pricing can also help smooth consumption patterns. Without intervention, however, peaks in winter demand will inevitably increase as more heating is supplied by electricity: this will be a particular issue for existing homes with higher heating demand. Add vehicles and other demand sources, and both the energy generation infrastructure and the provision for the transmission and distribution of the energy generated will need to be significantly upgraded if the necessary supply is to be delivered.
Ensuring energy availability and minimising demand peaks are critical challenges that must be addressed if the levels of renewable low-carbon energy in the electricity generation mix are to be increased. These challenges are prompting detailed investigation of the role energy storage systems can play in helping reduce costs and minimise disruption caused by decarbonisation of the energy system.
02 / Role of storage and peak demand reduction
Energy storage already plays a vital role in helping to manage the UK’s demand for peak power by spreading these requirements out over longer periods.
For example, the Dinorwig power station in Wales, a pumped-storage hydroelectric plant, provides a fast response to short-term changes in demand.
TV pickup, where ad breaks or programme scheduling result in synchronised demands on the network as people put the kettle on, open the fridge or flush the toilet, is the most well-known cause of demand spikes, although other national events can also result in significant and co-ordinated changes in short term demand.
Storage can also help to address temporal imbalances in the overall supply and demand imposed on the national power grid, for example by storing energy generated during the day for use in the evening. This is particularly useful for solar power, which typically generates a sur of power during the day that needs to be captured for use during the night.
Advances in battery technology have now made it a viable storage option, as witnessed by Tesla’s 100MW lithium-ion installation in South Australia. This facility is capable of powering 30,000 homes for up to an hour but will be mainly used to even out the electrical supply from the neighbouring Hornsdale wind farm.
03 / Types of energy storage
There are many options for storage at both utility and building scale, and in practice it is likely that different solutions will need to be combined. There are presently two main categories of energy storage available: thermal storage and electrical storage.
Thermal storage systems enable heat to be stored during off-peak periods or from local generation – for example, heat generated from building-mounted solar photovoltaic panels, reducing the need to export the power into the grid. The energy is then released when needed. Currently, this is most often achieved by use of water stores, and typically at building scale, but it can also be done at the network scale for use in site-wide heat networks.
Emerging thermal storage solutions use phase-change materials that enable heat to be stored more efficiently. A phase-change material is a substance with a high heat of fusion, which melts and solidifies at a certain temperature, thereby storing and releasing large amounts of energy.
Phase change materials enable smaller volumes of storage to deliver the same heat output,which makes them more suitable for use in new homes where space is at a premium. They also avoid costs for legionella risk management as only a small volume of water is stored in the system.
With the potential for good returns, low maintenance requirements, long life spans (more than 50 years) and, crucially, the ability to integrate with a range of heating and renewable energy supply systems, thermal storage heat units are being introduced into new housing schemes by a range of registered social landlords and local authorities.
Storage of electricity via battery systems is being deployed at both a utility and building scale. Battery systems are highly scalable and responsive but is currently relatively more expensive on a per kWh stored basis. Building-scale electricity storage is typically provided using lithium-ion batteries. In buildings, this is typically lithium iron phosphate, which has lower energy density than the systems used in vehicles but, which avoids using cobalt, a metal with significant price and supply volatility.
The cost of lithium-ion batteries has fallen hugely in recent years, and the International Renewable Energy Agency’s (IRENA) 2017 study, Electricity Storage and Renewables: Costs and Markets to 2030, suggests that further significant cost reductions are likely (see figure 2), which could transform the economics of the batteries’ use in homes and other buildings.
04 / Future role in buildings
A coherent approach to reducing peak electricity demand in buildings is likely to become an increasingly important component of energy strategies for new buildings. Interestingly, the new London Plan, which is at draft stage, includes an explicit requirement for new developments to demonstrate how peaks in demand will be minimised. Further, version 10 of the Standard Assessment Procedure (SAP) methodology proposed for measuring the use of energy in new homes provides explicit methods for factoring the impact of energy storage into new homes for the first time.
In any event, as the costs associated with increasing electricity demand for heating and vehicle use become more apparent, it is highly likely that peak demand reduction will become a standard design consideration, together with more established considerations such as overall energy use and carbon emissions.
In Germany, the government has promoted solar power to such an extent that more than one million homes have installed rooftop solar photovoltaic systems, and the country is now promoting energy storage to deal with excess power generation. It has recently commissioned the 100,000th domestic battery-storage system.
05 / Costs and benefits
Our analysis indicates that battery storage does not yet deliver a strong financial return in most situations, specifically where the cost per unit of energy stored is around 11p or above. This is because the spread between peak and off-peak domestic electricity tariffs is typically around 10p.
This means that, in the absence of other factors, the savings from moving the energy generation from peak to off-peak would not offset the costs.
However, this equation changes when energy storage reduces the need to export electricity generated by photovoltaics, or where the absence of storage would necessitate expensive upgrades to power infrastructure.
The IRENA states in its 2017 report, Electricity Storage and Renewables: Costs and Markets to 2030, that current energy densities for lithium-ion battery cells are among the highest available but performance can vary significantly as cells can either be designed for high discharge rates (where power is the main requirement) or low discharge rates (where energy is needed over a longer period).
They have a variety of applications in domestic situations, being quite portable, but presently they are a higher cost option.
At present, the use of thermal storage to reduce peaks may prove to be more cost-effective as the cost of storage is lower and longer lasting. Clearly the utility of stored heat is lower than that of electricity, which can be used for many purposes, but where peak demand is linked to a heating requirement then the flexibility of electricity storage is less useful.
As the IRENA study indicates, however, the economics of battery storage are changing rapidly. If projected cost reductions and efficiency improvements are delivered, by 2030 the cost of stationary batteries will have fallen by more than 60% and their cycle lifetime have risen by up to 90% compared with today’s values.
On this basis, battery storage is set to become a mainstream, cost-effective solution for those able to take advantage of reduced energy costs that are available when overall demand is lower, while also helping to effectively manage the wider energy system.
The authors would like to thank Ben Harris and Tom Richardson for their assistance in preparing this article