A primary statement released by AECOM on Monday has predicted that the proce of battery technology might fall by 40-60% by 2020.
The 130-page report developed by AECOM anticipates a “mega-shift” to energy storage promotion, based on the demand from both supply and consumer side. The report indicates that the price of lithium-ion battery will decline by 60% in less than 5 years, and 40% associated with flow batteries.
“The trend of reducing costs for battery technologies such as lithium-ion and flow battery technologies suggests that there will be a dramatic shift towards these technologies in the next one to two decades,” the report indicated.
The report further indicates that in order to move to a market-led roll-out in Australia, there should be some exhibition of some project, to alert “key stakeholders including consumers, local communities, technology suppliers, financiers, existing electricity asset owners, regulators, retailers and policy makers.”
“One of the largest markets for energy storage systems will be the end-user market, which looks to pair storage systems with rooftop solar PV,” the report indicates.
“PV can be coupled with storage to maximise usage behind-the-meter and ensure that PV generated during the day can be stored and used during the peak periods. This model is currently valuable for consumers because it reduces export of excess solar to the grid. Instead, the locally generated electricity can be used behind-the-meter, offsetting electricity purchased from the grid (which can be three to five times more expensive than standard export tariffs).”
“The behind-the-meter market segment of energy storage is widely expected to undergo a similar boom to the solar PV industry, with a tipping point expected within the next 10 years as further cost reductions are achieved,” the report says.
“Off-grid electricity is Australia’s most expensive electricity due to the underlying high gas and diesel prices in remote areas,” it notes.
“As such, the business case for renewables as a means to offset fuel use is strong. Similarly, in order to enable higher penetrations of renewables, energy storage can be utilised to manage the intermittent nature of wind or solar generation.”
Other economic indicators (as shown in the table below) responsible for the establishment of the behind the battery ‘megashift’, are tariff avoidance, time-of-use arbitrage, protection against black-outs, and network investment return.
The report indicated some limitations that will hinder the progress of battery energy storage in Australia as, financial, technical and regulatory: It notes that recently there is no possible subsidies from the government to increase the use of battery storage facilities, as well as Tony Abbott’s current anti-renewable energy policy.
The report advocates ARENA to collaborate with investors which include technology suppliers, electricity networks and power retailers to pave way for the spread of the technology in the near future.
“By supporting the development of an efficient market for energy storage, ARENA will facilitate additional supply of renewable energy by addressing intermittency and power quality challenges that could otherwise stall growth in the market,” the report indicates.
AUTHOR: DOUGLAS YEBOAH