Scaling Up: What Role Will Energy Storage Play In Future Large Solar Projects?

India recently concluded what is hailed as the world’s largest renewables-plus-energy-storage capacity tender – a tender for 1.2 GW of Renewable Energy (RE) capacity with assured power supply during six hours of peak demand (i.e. 05:30 – 09:30 hrs and 17:30 – 00:30 hrs). With the climate crisis becoming more and more evident and conventional sources of electricity becoming costlier, consumers are increasingly shifting towards renewable sources of energy. However, the renewable energy sources like solar are intermittent in nature meaning they are not available continuously for conversion to electricity. Hence, electricity storage has become a major focus of attention. 

Electricity cannot by itself be stored on any scale, but it can be converted to other forms of energy which can be stored and later reconverted to electricity on demand. Over time various electricity storage systems have been developed including Pumped Hydro Storage, Battery systems, Flywheel, Compressed Air Energy Storage, etc of which Pumped Hydro and Battery storage are commonly used technologies.

Pumped Hydro Storage has been used since the 1920s and as of 2016, it amounted to about 95% of the world’s large-scale electricity storage. It involves pumping water uphill to a reservoir from which it can be released on demand to generate hydro-electricity. Pumped storage systems are typically over 100 megawatt hours (MWh) stored energy and are deployed on a large scale. 

On the battery technology front, the cost of storage has come down drastically. Lithium Ion (Li-ion) Battery costs have reduced by about two-thirds between 2000 to 2015. Battery storage technology has helped create smart grids. A smart grid is a power grid which optimises power supply by using information on both supply and demand by using networked control functions of devices with communication capabilities like the smart meters. On household levels and even commercial and Industrial scales, battery storage helps to even out the peak hour demand independent of the grid as well as cater to power requirements during grid outage. 

Hybridising solar with battery and adopting newer technologies go a long way in customizing the solar plus storage systems to meet customer requirements. One such technology is the Grid sharing Solar inverter by Oorjan Cleantech that helps to compensate for the difference of power from the Utility grid (without discharging the batteries). Large Li-ion storage systems like the 129 MWh system installed by Tesla in the Australia and the recently concluded 1.2 GW RE with storage tender by the Solar Energy Corporation of India are welcome steps towards the ultimate goal of shifting completely to renewable sources. 

Cheaper Storage options and evolving technology would make it more efficient and cost effective to generate and consume electricity from Solar and other RE sources. 

Traditionally, energy storage has been limited to off-grid solar, but now its role extends to large utility-scale projects and grid-interactive projects as well. The India Energy Storage Alliance (IESA) has estimated a 70-GW market potential for energy storage by 2022, and this includes mega projects like solar parks as well. In fact, a large proportion of the Indian energy storage market pie will come from solar parks. Energy storage is expected to be an integral part of these projects.

While installing energy storage systems for large solar projects requires huge investments, energy storage costs have declined sharply in recent years, and the downward trend is likely to continue, making energy storage solutions an ideal way to deal with the intermittent nature of solar energy and reduce congestion.

While the T&D infrastructure for solar power is designed to withstand peak loads, the inconsistency in flow leaves the potential grossly underutilised and makes power systems prone to breakdowns and volatile fluctuations. This may be a bigger issue for larger solar projects, potentially leading to problems during peak usage. The problem can be overcome with energy storage solutions. Moreover, as many large solar facilities are in remote locations like deserts where grid infrastructure does not exist, we need to find a viable way to connect to and store solar energy. With the US and some European countries working on solar batteries for large solar projects, we may have better solutions in a couple of years.

The heavy deployment of solar power will necessitate policy decisions to minimise the impact of intermittency and enable grid integration of solar projects. This is where energy storage will come into play and do away with the need for pumping massive investments on upgrading transmission lines to evacuate electricity from mega solar projects.

According to the cost estimates from the first phase of Green Energy Corridors, the cost for building a 1-MW transmission system is more than Rs 1 crore. In contrast, large-scale energy storage systems will work out to be much cheaper. The National Electricity Plan amply highlights the role of large-scale energy storage in maintaining grid security, optimising generation, controlling intermittent generation from solar power, ensuring reliable operation of power systems and storing excess generation. Taking into account that utility-scale projects will need to store at least 10% of their daily generation, storage forms about 25% of the cost of a project. As this cost is projected to come down to less than half in the next few years, energy storage solutions are poised to become an integral part of mega projects.

The Power Grid Corporation is successfully operating large-scale storage projects in the country. Even the Solar Energy Corporation of India has invited bids for 3.6 GWh of storage connected to 1.2 GW of solar in the interstate transmission system. Foreseeing the need for grid scale storage, the Ministry of New and Renewable Energy has launched multiple pilot projects. The most promising of them is a tender recently floated by the NTPC, inviting bids for 625 MW of Solar PV with 100-MWh storage in Andhra Pradesh. While the Indian energy storage market witnessed a demand of 23 GWh in 2018, during 2019-2025 the cumulative potential for energy storage in behind-the-meter and grid-side applications is estimated to be about 190 GWh, according to the India Energy Storage Alliance.