In a recent study published in the journal Nature Climate Change, researchers at Massachusetts Institute of Technology (MIT) found that it currently makes economic sense to combine large-scale energy storage systems with renewable energy projects, such as wind and solar farms, in some locations. However, this window of opportunity for investment may not last. The research team concluded that as the cost of wind and solar power systems decreases, the cost of storage systems must also come down. Otherwise, at some point it will be more profitable to add more generating capacity rather than more storage capacity. Read on for more details on the study, including the states examined and a comparison of the costs of different storage technologies.
The MIT researchers studied three states and found that energy storage for renewables can be a good investment in Texas and California but not yet in Massachusetts. In Texas, for example, pumped hydro systems can provide added value today for solar or wind installations as the increased revenue from storing and then selling the power at peak prices would exceed the system’s costs. The researchers also evaluated the different storage technology choices currently available and determined that a compressed air storage system could add value comparable to that of a pumped hydro system. While lead-acid batteries would not provide as much value as the other two systems, they are still attractive because they can be installed anywhere and do not rely on natural features only available in certain locations.
The researchers note that, despite wide regional variations in the average prices and the amount of variability in demand and pricing, “the best storage technology in one location is also the best in the other” because of similarities in the properties of electricity price fluctuations. The MIT team also found that the costs of storage systems are not yet profitable enough without policy support and suggests that modest public policy support could boost market adoption, stimulate technological improvement, and encourage further growth.