This FAQ has four components:
Why is energy storage important?
Energy storage is one approach to accommodating the variability of wind and solar power generation, which is affected by the weather as well as daily and seasonal cycles. With the growth of renewables as a share of electricity generation, this variability can be a challenge because the electric grid needs to be balanced. This means that supply and demand—electricity generation and electricity consumption (load)—must be equal at all times to prevent outages and meet demand.
Renewable energy from wind and solar—unlike conventional power plants (coal, natural gas, or nuclear)—is “non-dispatchable,” which means it can’t be turned on and off as needed to meet load. Wind and solar are variable. Energy storage allows us to stockpile energy during periods when wind turbines and solar panels are in operation and use it when there is less wind and sun.
However, the underlying need is not storage; it is to ensure that generation and load are equal and there isn’t unmet load. There are multiple methods, beyond storage, to balance out the fluctuations of wind and solar enough to allow for a high proportion of renewable energy in the grid.
Can grid balance solutions enable a high penetration of wind and solar?
In the traditional electric grid, generation is varied by grid operators to meet the load. Load fluctuates throughout the day and across the seasons. Generation can be varied to respond by having some power plants always running (base load, traditionally coal and nuclear), some that are scheduled to run during the daily peak (often natural gas), and some that can be brought online very quickly if demand rises beyond the forecast on a particular day, such as during a heatwave that boosts electricity use as people turn up their air conditioning (so-called “peakers” and spinning reserve). In this traditional model, demand is assumed to be external; it’s a function of customer decisions, weather, etc., and production must be varied to meet it.
In an electric grid with high share of wind and solar power, there are many ways to ensure that generation and load are equal, including:
- Transmission: Building long-distance transmission lines enables utilities to send power from where it is abundant to where it is needed, e.g., from where it is currently sunny or windy to where it is cloudy or calm. Combined with advanced weather forecasting, this enables grid operators to balance generation and load.
- Complementary renewable energy sources: There are complementarities between wind and solar in some regions: for example, in the U.S. Great Plains, it is windier at night, and solar of course is generated during the day. These can help balance generation and load.
- Demand response: Real-time pricing and demand response can shape load to match generation. Power applications such as heating and cooling, refrigeration, and home appliances like dishwashers and washer/dryers can be designed to sense the current real-time price of power and then adjust when they run, subject to constraints like “don’t let the temperature in my house go above 75°F or below 66°F” and “make sure the dishes are clean by morning" (or whatever the user prefers). Similarly, some industrial processes can be demand-responsive.
- Curtailment: The use of less wind or solar power than is potentially available at a given time, which can increase grid flexibility.
- Energy markets: These regional or country-level entities match buyers and sellers of electricity. For instance, Independent System Operators (ISOs) and Regional Transmission Organizations (RTOs) in some parts of the United States facilitate wholesale electricity market transactions and ensure grid reliability.
- Energy storage: There are multiple forms of energy storage including batteries, thermal storage, hydro, compressed air, mechanical and gravitational potential energy, and hydrogen.
In sum, the problem of balancing generation and load in a system with growing shares of variable renewable generation involves a number of solutions, including but not limited to battery storage. In En-ROADS, there are sliders to test innovation in energy storage and adoption of demand response technologies.
How is energy storage modeled in En-ROADS?
Subsidizing renewable energy in En-ROADS leads to its growth as a larger share of electricity demand, thereby reducing emissions. However, the increase in variable renewable energy from wind and solar requires more energy storage to accommodate the displacement of dispatchable energy sources. Consequently, the demand for energy storage drives up costs, slowing renewable energy growth. Over time, learning rates and economies of scale cause storage costs to fall, supporting higher levels of renewable energy adoption. Learn more in this video.
En-ROADS models energy storage requirements as a function of the capacity share of variable renewables to total electricity. As variable renewable energy generation grows in share, more storage capacity is needed to accommodate. Furthermore, as the share grows to be the majority, the nature of this storage need changes from occasional short-term needs (hourly) to longer-term diurnal and seasonal duration storage. En-ROADS assumes that storage requirements will not directly limit the use of renewable energy, but the costs of renewables in the model reflect the added costs from energy storage.
En-ROADS includes two groups of technologies for energy storage:
- Hydrogen: Produced via water electrolysis, hydrogen is an emerging technology and a plausible candidate to meet the demand for long-term storage coverage. However, this technology needs to overcome high ancillary costs (e.g., building pipeline infrastructure, permitting, and safety concerns) to become a commercially attractive solution.
- “Other storage:” This category aggregates all storage technologies except hydrogen, e.g., lithium-ion batteries, pumped hydropower, vanadium flow batteries, compressed air, gravity storage, and any new storage technology. According to the IEA, pumped-storage hydropower is the most widely used storage technology—covering over 90% of total global electricity storage in 2020—and it has significant additional potential in several regions. Most of this technology today is being used for balancing daily variability. Batteries are the most scalable type of grid-scale storage within this category, with a total installed capacity close to 28 GW at the end of 2022, 60% of which was added only between 2021 and 2022.
How do I simulate an increase in energy storage in En-ROADS?
The growth of renewable energy results in an increase in the energy storage capacity in En-ROADS. Notice how a subsidy to Renewables (or a tax on any alternatives, e.g., a carbon price) creates an increase in the “Energy Storage Capacity Installed by Technology” graph (found under Graphs > Primary Energy Demand—Types). The higher costs to build additional storage infrastructure add to the costs of renewables. Innovation in energy storage to make this technology more affordable is therefore an important component of a clean energy future.
Options to affect energy storage innovation in En-ROADS are located in the Renewables advanced settings (click the three dots next to the Renewables slider). These include:
- Hydrogen storage breakthrough cost reduction: This slider represents a sudden reduction in the cost of hydrogen produced via electrolysis for energy storage. By default, the electrolysis process modeled in En-ROADS relies on electricity from the grid in the Current Scenario—which is supplied with a mix of renewables, fossil fuels, nuclear, bioenergy, and possibly new zero-carbon energy. To learn more about Hydrogen in En-ROADS, you can read “How do I simulate hydrogen use?”
- Other storage breakthrough cost reduction: This slider represents a sudden reduction in the cost of other storage technologies, excluding hydrogen, e.g., lithium-ion batteries and pumped hydropower. Innovation in any other new technology would also be simulated with this slider. However, the cost and other parameters used correspond to the lithium-ion battery as a proxy.
To change the energy storage assumptions in En-ROADS, click on the Simulation menu in the top toolbar of the En-ROADS interface and select Assumptions. Some of the assumptions and parameters that can be changed include demand response approaches, the percent of hydrogen produced using renewable energy, the progress ratios, and round-trip efficiency. To learn more about each assumption, click on the gray arrow next to the slider’s name to view the description.