What is a battery energy storage system?
A battery energy storage system is an electrochemical device capable of storing energy when demand is low and releasing it when demand is high. It can be charged using various energy sources, including renewable energy such as solar or wind power.
The most common form of grid-scale battery energy storage is the lithium-ion battery—the same type used in mobile phones and electric vehicles. Lithium-ion batteries retain their charge longer than most other battery types; thanks to advancements in technology and manufacturing processes, their costs dropped by 80% between 2013 and 2021, further driving their widespread adoption.
While lithium-ion batteries are the most prevalent, other types include lead-acid batteries, sodium-based batteries, and redox flow batteries.
Why do we need battery energy storage systems?
As the world strives to increase the use of renewable energy, battery energy storage systems have become increasingly important. Without energy storage facilities, the power grid must generate electricity at the exact moment consumers use it.
However, renewable energy generation is intermittent, meaning it relies on uncontrollable environmental factors. Wind and solar power generation can only occur when there is sufficient sunlight or suitable wind; consequently, on some days, energy production may be insufficient, while on days with abundant sunshine or strong winds, production may exceed actual demand. Although this might seem like a positive thing, the grid must maintain a balance between energy supply and demand, and excess electricity can jeopardize grid stability.Battery energy storage systems enhance grid stability while facilitating greater utilization of renewable energy.
Additionally, energy storage systems allow operators to store electricity when prices are low and release it when prices are high.
How do battery energy storage systems work?
First, let’s define a few terms.
Rated power refers to the maximum power output a battery can deliver at any given moment, measured in megawatts (MW).
Duration refers to the length of time a battery can discharge continuously at its rated power.
Energy capacity is measured in megawatt-hours (MWh).
For example, if a battery has a rated power of 10 MW and an energy capacity of 20 MWh, it means it can discharge at that rated power for two hours.
However, timing the discharge correctly is crucial. Battery operators use software with built-in algorithms to coordinate energy generation and employ computer control systems to decide when to store energy or discharge it into the grid.
This enables operators to enhance grid reliability and generate profit by storing energy when prices are low and discharging it when prices are high—a practice known as arbitrage.
Conclusion
As grid operators seek to improve reliability and increase the use of renewable energy, the costs of grid-scale battery energy storage systems are falling, and their importance is growing. Driven by global efforts to meet climate goals and the improving economics of these systems, they are becoming increasingly critical—a trend expected to continue.
