Caves and mountaintops for electricity storage? That seems to be the newest development as companies ranging from Siemens AG (NYSE: SI) to General Electric (NYSE: GE) to Energy Cache (a startup backed by Bill Gates) are squeezing air into salt mines and running empty trains up hills. Their objective is to figure out how to capture the energy released as the air bursts out and the trains roll back down.
“Electricity is the only commodity in the world that isn’t really stored,” said Prescott Logan, who heads GE’s storage business in Schenectady, New York, where last month it opened a $100 million plant to make batteries for utilities. When storage becomes cheap and massive, “the impact will be huge.”
The renewables industry is now worth around $260 billion, and it needs reliable storage infrastructure so that surges from solar or wind farms can be adequately absorbed. Currently, storage receives an annual investment of around $2.6 billion. This is expected to become just over $9 billion by 2015, and then jump to $25 billion by 2021. But GE hopes to see between $500 million to $1 billion in revenue from energy storage by 2020.
Previously, experiments were carried out for energy storage by pumping water uphill. However, that practice was inefficient, limited to mountainous terrain, and ended up negatively impacting local flora and fauna.
Currently, energy storage levels are at roughly 150 gigawatts, and nearly half of that is in the Asia-Pacific region with the rest spread between North America and Western Europe. Mandates by various states and governments to blend in increasing mixes of renewable power will spur demand for reliable storage, which is why many major firms are conducting ongoing tests in advanced battery management and design.
The German firm RWE (ETR: RWE) hopes to develop a demonstration version of its compressed air system by 2016. The RWE system squeezes air into underground caverns during times of high power and low demand (like during breezes at night). As the air is released, it runs a turbine above ground, which results in electricity.
Energy Cache, which is championed by Bill Gates, is looking at shoveling gravel up and down slopes on ski lifts. Another firm, Gravity Power LLC., is pushing water in and out of caves below ground level.
And Advanced Rail Energy Storage is experimenting with flipping electric trains between high and low rail yards. Advanced Rail has a demonstration facility in the works. It is situated in Nevada, and should begin operations in nine months or so. A commercial-scale facility in California could eventually store up to 300 megawatts of power. The Nevada plant is expected to cost around $50 million, and will be hooked up to the western regional grid.