Published on July 19th, 2013 | by Zachary Shahan68
Eos To Conquer The World?
July 19th, 2013 by Zachary Shahan
Eos Energy Storage is one of the energy storage startups we have highlighted as being a potentially “breakthrough energy storage company.” Before delving into the latest big news from Eos — you know, its plans to take over the world — let me just insert a little bit of context about market potential in the energy storage sector.
I think this phrase gets a bit old to those of us who cover this space, but in case you haven’t heard it, low-cost energy storage is sort of considered the holy grail of the clean energy economy. I will admit that I think it’s a little overhyped. We can get to extremely high penetrations of renewable energy with relatively little energy storage. However, energy storage is a big help. And, in actuality, low-cost energy storage would be a big help for the energy market across the board. We have an extremely small amount of energy storage on the grid. With regards to battery storage specifically, the CEO of Florida Power & Light (a large Florida utility) noted in a utility company CEO roundtable a couple years ago that, “if you took all the battery storage in the world, it could only produce the energy requirements of the world for like 10 minutes.” This results in wasted electricity generation at times of low demand, and very high prices at times of peak demand when all of a sudden peaker power plants have to be turned on (except in Germany and places with high solar energy generation). It’s also the reason why so much backup power capacity (backup power plants) have to be in place, for both renewable and nonrenewable resources.
It’s clear from watching the situation in Germany that, as solar power capacity grows, it won’t be too long before more electricity will be generated in the middle of the day than is needed on the surrounding grid. The same goes for wind power at night. A lot of wind power production has driven wholesale electricity prices below $0.00 in Texas, Germany, and Europe as a whole. So, energy storage becomes increasingly valuable. With it well understood across the industry that wind and solar power are the future and that energy storage costs are projected to drop (due to companies like Eos, as well as simple economies of scale), it’s projected that the energy storage market will indeed grow considerably in the coming years. Here’s a chart on just that from Eos itself:
And here’s a chart on the tiny part energy storage plays today:
And here’s one on the tiny part batteries play in that tiny part of the market:
Anyway, the key with Eos (which we’ve written about previously) is that it is claiming that its technology comes at a very, very low price:
Eos Announces Huge Global Partnership
It seems the claims have reached some big ears. On to the news…
In an email sent to me earlier this week, a representative of Eos wrote:
In short, several of the world’s largest utilities, competitive energy providers and IPPs have committed to piloting Eos’s grid-scale battery storage technology and are intimately involved in Eos’s product development and demonstration process. Collectively known as the Genesis program, these partners represent over 300 gigawatts of generation, 1.6 million miles of transmission and distribution, and 76 million customers in over 70 countries – creating an unprecedented platform for introduction and ultimately widespread implementation of the technology.
This is big. Partners representing over 300 gigawatts of generation! 70 countries!
Partners in Eos’s Genesis program include Enel (Italy’s largest utility with a 30 GW renewable IPP arm operating in the U.S. and internationally), National Grid (both the U.K. transmission operator and the U.S. utility), GDF Suez (the world’s largest IPP), and the Public Service Company of New Mexico (PNM). These partnerships follow previous announcement of Eos’s first pilot project with Con Edison of New York and announcement of financial investment made on behalf of NRG Energy, the largest competitive energy provider in the U.S.
We view these partnerships both as validation of Eos’s battery storage technology and go-to-market strategy, as well as an indication that grid-scale energy storage is quickly moving from a niche technology to widespread adoption in the utility sector.
“The Genesis program entails cooperation with integrated utilities, competitive energy providers, and pure transmission and distribution operators – a range that ensures the ability of Eos’s technology to address a variety of markets, operating models, and energy storage applications,” said Eos President Steve Hellman. “Eos looks forward to working with these partners, which include some of the world’s largest and most advanced utilities and energy companies, to demonstrate how our energy storage technology can create economic value throughout a wide range of uses.”
“Being the world’s leading supplier of energy and environmental efficiency services, and with 116 GW of installed generation capacity spanning more than 70 countries, GDF SUEZ is convinced of the growing need for energy storage worldwide,” commented Léon Duvivier, Vice President of Technology within the Research & Innovation Division at GDF SUEZ. “We look forward to exploring how energy storage can be monetized across a variety of market and regulatory structures.”
“Eos is focused on producing a reliable 25-year battery that can integrate into the utility grid at a price equivalent to a combustion gas turbine,” said PNM Chief Operating Officer Ron Talbot. “If they can do that, Eos will be in a position to change the way utilities do business.”
Putting Eos Prices Into Context
One of our readers also caught wind of this news and sent over some useful perspective. He noted some useful points for putting $160/kWh into perspective. The price of lithium-ion batteries is probably around $400/kWh, $250/kWh at the very lowest. Power Engineering quotes battery prices as being between $400 and $1000 per kWh today.
$160/kWh is a big change.
In a video on the Eos site, it notes being able to shift off-peak to peak for ~$0.10/kWh, all expenses included.
“If what they say is true, it’s the missing piece of the renewable energy puzzle. Affordable, distributable storage,” our anonymous reader adds.
“It gets us away from ‘big project’ storage such as pump-up and CAES, which takes years to build, and creates a solution which can be pumped out of factories close to the point of use. Plopped down in low cost real estate. And plugged into the grid. Modular storage.”
This is a big deal. We’ll see what comes of this Genesis program. We’ll see if $160/kWh is the price after all. And we’ll see if Eos really has what it takes to conquer the world. But the simple fact that it has so many big, key companies partnering with it is certainly something worth paying attention to.