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Grid-connected Energy Storage: Countries adopting energy storage solutions [free access]

October 14, 2016

Given the forecast growth in global renewable energy capacity, energy storage systems (ESS) are expected to play a crucial role in helping grid operators maintain system stability while facilitating the efficient integration of renewables into the networks. While the US continues to take the lead in the deployment of ESS, many countries have begun to provide the requisite policy push to effectively use energy storage to meet their clean energy goals. According to the International Energy Agency’s (IEA) Energy Storage Technology Roadmap of 2014, around 310 GW of new storage capacity could be required by 2050 across US, Europe, China and India.


US and Canada

In the US, federal-level policy support for energy storage is gathering momentum. This is evidenced by the introduction of two bills, i.e., the Energy Storage Promotion and Deployment Act of 2015 and the Energy Storage Tax Incentive and Deployment Act of 2016, in the House of Representatives.


The first bill was introduced in May 2015 and requires large utilities (selling 500 GWh annually) to meet at least 1 per cent of their annual average peak power demand from storage by 2021 and 2 per cent by 2025. This translates into a storage capacity of 8 GW by 2021 and 18 GW by 2025. The second bill was introduced in July 2016 to establish investment tax credits (ITC) for commercial and residential use of energy storage. The proposed tax incentives apply to large, grid-connected ESS as well as to smaller battery systems for residential power. Although the two bills are still in the draft stage, they indicate that policymakers are keen to provide the requisite push, similar to that provided to wind or solar assets, to promote the deployment of ESS.


Moreover, in early 2016, the Federal Energy Regulatory Commission (FERC) asked all the independent system operators (ISOs) and regional transmission organisations (RTOs) to submit their comments regarding the barriers to energy storage that would prevent such resources from participating in capacity, energy and ancillary service markets. The federal regulator wishes to gauge whether the current market structure is distorting competition and whether it is not conducive to the participation of storage resources in these markets. In November 2016, FERC will host a technical conference on methods to compensate ESS for the multiple values they provide in wholesale markets.


While the federal policy and regulation on energy storage is still evolving, individual states have either launched or are successfully implementing their own independent programmes. California has been the leader in this regard. In 2013, the state regulators set a target for the three investor-owned utilities operating in the state to achieve 1,325 MW of energy storage capacity (AB 2514) by 2024. Recently, in June 2016, the California Public Utilities Commission (CPUC) revised the Self-Generation Incentive Program (SGIP) to give a further boost to energy storage applications. The new decision allocates 75 per cent of the annual SGIP budget to energy storage, giving priority to storage systems paired with renewable energy. Further, 15 per cent of the storage incentives will be set aside for residential projects.


While California has been a leader in the deployment of residential storage systems, PJM is the leader in terms of utility-scale energy storage systems. PJM evolved a market-based approach to resolve its grid operation challenges instead of working by a mandate. PJM witnessed a rapid increase in the use of battery energy storage systems (BESS) to provide frequency regulation after the passage of FERC’s Order 755 of 2011, which put energy storage on an equal footing with traditional resources. 


Given the experience gained by these two states, there is a growing interest in storage in other markets as well. In June 2015, Oregon passed an energy storage legislation, Bill 2193-B, which requires the state’s two main utilities, Portland General Electric (PGE) and PacifiCorp, to have 5 MWh of storage in service by January 1, 2020. Notably, the law gives a significant role to the regulator and requires the Oregon Public Utility Commission (OPUC) to initiate rulemaking procedures by January 2017. 


The third state that could soon put in place an energy storage mandate is Massachusetts. According to a recently passed bill (Bill H.4568), the state’s Department of Energy Resources (DOER) has to decide by the end of 2016 whether to set a procurement target for electric companies to procure viable and cost-effective ESS by 2020. In case it decides to do so, the DOER would have to adopt the procurement targets by July 2017. In fact, the state began extending its support to energy storage over a year ago with the governor’s USD10 million energy storage package announced in May 2015. Under this initiative, in addition to the funding commitment from DOER, a two-part study conducted by DOER and the Massachusetts Clean Energy Center looked into the opportunities and policy options with respect to energy storage. This study, released in September 2016, does not recommend an energy storage mandate but provides a cost-benefit analysis of procuring 1,766 MW of energy storage, which would cost USD970-1,350 million. This investment could result in USD2,300 million in system benefits for ratepayers besides USD1,100 million in market revenue for the resource owners and USD250 million in regional system benefits for the other New England states due to lower wholesale market prices across ISO New England (ISO-NE) in addition to climate benefits from reductions in carbon emissions.


Projects: Some examples of recently deployed storage systems in the US include the 25 MW/14 MWh BESS based on lithium-ion technology located in Anchorage, Alaska. Commissioned in January 2016, the USD30.2 million project is part of Alaska Railbelt Cooperative Transmission and Electric Company's (ARCTEC) Unconstrain Bradley Lake hydro project and aims to improve the transmission system between Anchorage and Kenai. 


In late 2015, the 110 MW Crescent Dunes Solar Energy Project and the associated molten salt thermal ESS went into commercial operation in Tonopah, Nevada. It is the world’s first utility-scale facility to feature advanced molten salt power tower energy storage capabilities. The project is capable of storing 10 hours of firm, reliable electricity from solar energy to power 75,000 homes in Nevada during peak hours. SolarReserve developed the storage technology while Toponah Solar Energy, LLC developed the concentrated solar power (CSP) plant. The latter has entered into a 25-year contract with NV Energy to sell the power from the USD983 million project.


Another similar project, the 150 MW Rice Solar Energy project, was commissioned in June 2016 in Riverside County, California. This project, involving an investment of USD750 million, has also been developed by SolarReserve (and its subsidiary Rice Solar Energy, LLC) with the molten salt thermal energy storage technology.


In October 2016, Imperial Irrigation District (IID) installed a 30 MW/20 MWh lithium-ion-based BESS in El Centro, California, to help integrate around 50 MW of solar generation capacity (Midway III and SunPeak 2) into the local grid. GE is the integrator company, Samsung SDI is the technology provider and Coachella Energy Storage Partners (CESP) is the developer of the USD68 million project.


Among the smaller projects executed in the last year is the 10 MW Advancion Energy Storage facility (based on lithium-ion battery technology) at Maryland’s Warrior Run facility. AES Energy has deployed its latest iteration of BESS, Advancion 4. The project was commissioned in November 2015 and provides spinning reserve capacity and frequency regulation services in the PJM market. LG Chem is the storage technology provider. More recently, in May 2016, AES Corporation, through its subsidiary Indianapolis Power & Light Company, deployed the 20 MW/20 MWh lithium-ion-based BESS in Indianapolis. Samsung SDI is the technology provider for this project.


Several new orders have also been announced. Among them is Hecate Energy Bancroft, LLC’s 20 MW energy storage facility in Spring Valley, San Diego. In March 2016, San Diego Gas and Electric (SDG&E) signed a 20-year power purchase agreement contract with the company for supplying power during peak demand.


In August 2016, AltaGas signed a 10-year energy storage resource adequacy purchase agreement with Southern California Edison (SCE) for its 20 MW/80 MWh lithium-ion-based BESS at its Pomona facility. The project is expected to cost between USD40-45 million and is expected to go online by the end of December 2016.


Separately, SCE has entered into a three-year contract (Santa Paula 1 contract) with Western Grid for its 5 MW lithium-ion battery project, which is designed to provide resource adequacy through four hours of discharge. This project, which is scheduled for commissioning by December 2016, is part of the larger 15 MW project for which SCE has signed a long-term contract with Western Grid. This capacity is set to go online by 2020 and will help in meeting California’s broader energy storage mandate.


Another lithium-ion project announced in March 2016 is Alevo Group’s 8 MW/4 MWh ESS in Lewes, Delaware. This project falls in the PJM area and Alevo will be able to sell ancillary services to the PJM regulation market. Meanwhile, PJM is currently reviewing a 12.5 MW BESS project by Axion Power International in Sharon, which will provide frequency regulation. This project was also announced in March 2016. This project will deploy Axion Power’s advanced lead-carbon PbC PowerCube batteries.


GE is implementing a 15 MW lithium-ion battery storage project that will be bundled with Deepwater Wind’s 90 MW offshore wind farm in Montauk, New York, to serve the South Fork peninsula in New York State. The project, which will provide renewable capacity firming service, is expected to go online in the beginning of 2018.


Among the big projects is Pacific Gas and Electric Company’s (PG&E) 300 MW advanced compressed air energy storage (CAES) or A-CAES demonstration plant. This USD355 million, three-phase project will use an underground storage container (depleted gas reservoir), and next-generation turbomachinery. The preliminary engineering and regulatory permitting is under process. If found cost effective, the project is expected to be commissioned by 2020. The project has received USD50 million in funding under the American Recovery and Reinvestment Act of 2009 – RD&D, and an equal amount from CPUC, California Energy Commission (CEC) and Electric Power Research Institute (EPRI).


In Canada, Ontario is leading the way in deploying ESS and is testing a range of battery applications. As mandated by the state’s Long-Term Energy Plan, Independent Electricity System Operator (IESO) concluded the two-phase procurement process for 50 MW of storage in November 2015.


IESO awarded the contracts to 10 companies through the process. In the first phase, 33.54 MW was awarded to Canadian Solar Solutions Inc., Convergent Energy and Power LLC, Dimplex North America Ltd, Hecate Energy and Hydrogenics Corp. In the second phase, 16.75 MW was awarded to Ameresco Canada Inc, SunEdison Canada Origination LP, NextEra Canada Development & Acquisitions, Inc, NRStor Inc and Baseload Power Corp. The technologies that will be deployed include battery, flywheel, thermal, hydrogen and CAES systems.


Most of the contracts have been designed to support grid performance through the provision of frequency regulation service or voltage support. These projects are expected to become operational in various stages over the course of 2016 and 2017. The idea is to test the economic viability of using storage to balance the grid and to help in integrating the expected increase in renewable capacity, estimated to reach about 10 GW by 2020.


According to the report on the outcomes of the procurement of 50 MW of energy storage submitted by IESO in March 2016 to the Ministry of Energy, energy storage can provide a wide range of services required for the reliable operation of Ontario’s power system. This includes regulation, voltage control, operating reserve and flexibility. It further states that energy storage is expected to provide regulation services at a cost that is comparable to the cost of traditional providers including hydro generators. It may be noted that the only large-scale energy storage facility in Ontario is the 174 MW Beck Pumping Station in Niagara.


Prior to the mandated procurement of 50 MW, IESO had already procured ancillary services from small energy storage projects, i.e., NRStor and Temporal Power’s grid-connected 2 MW flywheels, and Renewable Energy Systems Canada’s 4 MW storage project. Ontario’s other leading projects include Hydrostor’s underwater compressed air system, Hydrogenics’ hydrogen generation and eCamion’s grid-scale lithium batteries.



Europe is experimenting with new ESS although the focus at the pan-European level continues to be on pumped hydro energy storage (PHES) systems. Almost two dozen energy storage projects have been included in the project list to be assessed by the European Network of Transmission System Operators for Electricity (ENTSO-E) as part of the 2016 Ten-Year Network Development Plan (TYNDP). Given the pre-condition that the project size should be at least 225 MW for it to be eligible for inclusion in the list, only eight of 23 projects were non-PHES projects. Other technologies on the list include CAES, BESS and molten salt. However, several pilots based on other technologies, outside the purview of TYNDP, are being tested across the continent. Various transmission system operators (TSOs) are now procuring and experimenting with new energy storage technologies for grid and ancillary services, particularly for frequency regulation and renewable firming services.


The UK’s National Grid has awarded seven firms four-year contracts to provide balancing services for the network under the country’s first 200 MW Enhanced Frequency Response (EFR) auction during 2016. The companies are Vattenfall, Low Carbon, E.ON, EDF Energy Renewables, Element Power, Renewable Energy Systems (RES), and Belectric. These firms will provide EFR through BESS located at various facilities. National Grid defines EFR as a service that can achieve 100 per cent active power output at 1 second (or less) of registering a frequency deviation. It is a new service that is being developed to improve management of the system frequency pre-fault by maintaining the system frequency closer to 50Hz under normal operations. National Grid estimates that the auction will result in EUR200 million in cost savings and will also streamline the services to make them as efficient as possible.


Meanwhile, in July 2016, the UK-based renewable energy group Gaelectric received EUR8.28 million in funding from the Connecting Europe Facility (CEF) of the EU to develop the 330 MW Larne CAES energy storage project in Northern Ireland. The funding will be used by Gaelectric to drill an appraisal well and conduct detailed studies on the design and commercial structure. The project is expected to be commissioned in 2020. This project is also part of the TYNDP 2016 project list under assessment. Other Gaelectric projects on this list include the CAES systems at Cheshire in UK (268 MW) and at Zuidwending in the Netherlands (330 MW).


Among the recently operational projects is the AES’ 10 MW/5 MWh ESS at its Kilroot power station in Northern Ireland. Commissioned in December 2015, the Advancion array, which uses more than 53,000 LG Chem batteries in 136 nodes, is installed inside the Kilroot coal-fired generation plant and enhances grid reliability by providing fast response ancillary services, such as frequency response, for the All Island Electricity System, which has a high penetration of intermittent onshore wind energy. The system is connected to the System Operator of Northern Ireland (SONI). This project is the first step towards a planned 100 MW energy storage array adjacent to Kilroot.


New technologies are being tested through demonstration projects. One such project nearing completion is Highview Power Storage and Viridor’s pre-commercial liquid air energy storage (LAES) technology demonstrator at Pilsworth in Greater Manchester, UK. The 5 MW LAES facility received over GBP8 million from UK’s Department of Energy & Climate Change (DECC). Besides providing energy storage, this plant will convert low-grade waste heat from the onsite landfill gas engines to electricity. The project will be tested for providing several grid-balancing services.


Another project is the Engineering and Physical Sciences Research Council (EPSRC) grid-connected storage research demonstrator. The EPSRC-funded project uses a 2 MW lithium-titanate SCiB system supplied by Toshiba and ABB. Further, Western Power Distribution (WPD) is providing the point of network connection and a short-term lease at its 11 kV Willenhall substation.


Germany is leading the way as far as residential storage applications are concerned, mainly due to the grants and subsidies it offers to this segment. Efforts are also underway to use energy storage to balance the transmission network operations.


In July 2016, a 5 MW modular, large-scale BESS was commissioned at the technical institute RWTH Aachen University in Germany. Claimed to be the world’s first modular BESS device, known as M5BAT (acronym for modular, multi-megawatt, multi-technology medium voltage battery storage system), the project aims to assess and demonstrate the appropriateness of combining several different battery types into one system. E.ON, SMA, Exide and RWTH Aachen University have come together as project partners to execute the project. The battery system will be connected to the local medium voltage grid and used to balance energy supplies.


In February 2016, Germany’s solar photovoltaic (PV) manufacturer Belectric announced that it has started manufacturing its latest EBU energy storage system, which will be installed in the German transmission network for frequency regulation. The German transmission network operator qualified this system for frequency response in mid-2015, following its successful installation at the Alt Daber solar power plant in Brandenburg. The storage system is integrated in a standard 40-foot container with cost-effective assembly and is easily transportable.


Among future projects is the 90 MW energy storage units procured by STEAG GmbH for installation at its cogeneration plants at six locations, namely, Herne, Lünen, Duisburg-Walsum, Bexbach, Fenne and Weiher. The EUR100 million project involves the installation of 15 MW BESS at each of these locations. LG Chem lithium batteries will be deployed by Nidec ASI, which is the power electronics provider as well as the engineering, procurement and construction (EPC) contractor for the project. The project is expected to be completed by July 2017. STEAG will use these systems to generate primary balancing power to ensure the stability of Germany's electricity network.


The deployment of used electric vehicle (EV) batteries for energy storage is becoming popular. For instance, Bosch Energy Storage Solutions, in September 2016, began trial operations of its Hamburg energy storage facility, built with 2,600 used battery packs from over 100 BMW EVs. Power from the 2 MW battery second life project will be sold on Vattenfall’s primary control reserve market.


Another similar project that is nearing completion is the 13 MWh battery storage project at Lünen, Westphalia, being executed by Daimler AG, The Mobility House AG, GETEC Energie AG and REMONDIS SE. Daimler and its subsidiary Accumotive are also working with Stadtwerke Hannover AG (Enercity) to build a 15 MWh facility at Herrenhausen, Germany. This facility will use 3,000 used batteries to provide grid-balancing services.


France’s TSO Réseau de Transport d'Électricité (RTE) has adopted a 1 MW lithium-ion storage system, BattGrid, to maintain the baseline frequency of the power grid. This storage system has been developed by a local power utility, ENGIE.


In Italy, as part of the TSO Terna’s Storage Lab programme, which involves energy storage systems of 16 MW in Sicily and Sardinia under Phase-I, flow battery solution provider UniEnergy has launched a utility-scale ESS in Ciminna for Terna’s 450 kW/1,440 kWh substation. The system consists of an advanced vanadium flow battery with a new generation electrolyte. Terna will install 24 MW of additional storage at the two locations based on the results of the first phase.


In Finland, Fingrid and Finland-based power group Helen are planning to install a BESS in Helsinki during 2016, to meet solar energy fluctuations. The battery system is expected to enable cost-efficient stabilisation of power system frequency.


Asia Pacific

In Asia, Japan and Korea have taken the lead in deploying ESS while India and China continue to test suitable storage technologies through pilots. Australia is also emerging as a significant market for ESS.


Japan’s focus on renewable energy and its supportive policies have given a boost to ESS. The country is providing subsidies for installation of lithium-ion battery-based stationary storage systems, largely used in residential storage applications. The country’s Ministry of Economy, Trade and Industry (METI) and the Cabinet Office of Japan announced their long-term strategies for 2030 and 2050 through Innovative Energy Strategy, and Energy and Innovation Strategy (NESTI 2050), respectively, in April 2016. These policies reiterate the focus on energy conservation and expansion of renewable energy. The development of innovative technologies like energy storage is inevitable in the given context. The country is already experimenting with various technologies through demonstration projects. METI is assisting these pilots at home and abroad through the New Energy and Industrial Technology Development Organization, or NEDO. In 2016, METI launched a programme to promote virtual power plants (VPPs) that apply advanced energy management technologies to centralised control of end-user side resources, such as automated demand response (ADR), renewable energy and storage batteries, dispersed throughout the power grid. The plan is to establish control technologies for VPPs with a capacity of over 50 MW over the next five years, and to encourage further implementation of renewable energy. Japan also has plans to open a negawatt exchange market in 2017 whereby end users can sell small amounts of saved electricity.


Recently completed projects in the country include Kyushu Electric Power Company’s 50 MW/300 MWh project delivered by Mitsubishi Electric Corp at the Buzen substation in Buzen, in the Fukuoka Prefecture. It is part of a pilot project to balance supply and demand through high-capacity energy storage systems. The project uses sodium-sulfur batteries and became operational in March 2016. NGK Insulators provided the storage technology for the project.


Another technology under testing is the vanadium redox storage system. In January 2016, Hokkaido Electric Power (HEPCO) and Sumitomo Electric Industries (SEI) installed a 15 MW vanadium redox storage system at the Minami Hayakita substation on the northern island of Hokkaido.


Separately, on the island of Hokkaido, Nidec ASI and Advantec Company Limited announced in mid-2016 that Advantec will install a 6 MW solar power plant while Nidec ASI will provide four lithium-ion battery-based ESS with a total capacity of 6 MW/6 MWh.



South Korea is firmly committed to promoting the renewable energy market, including the deployment of ESS. Recently, South Korea’s Ministry of Trade, Industry and Energy announced an initiative, slated to begin in 2017, that provides incentives for utility-scale solar operators to install storage units with PV plants, along with its plans to invest USD27 billion in renewable energy capacity over the next five years. With this incentive, the government expects that there will be USD392 million in new demand for energy storage by 2020. In capacity terms, this translates to about 1,700 MW.


Korea Electric Power Corporation (KEPCO) is leading the utility-scale market in the country through its collaboration with various South Korea-based battery providers like Kokam, LG Chem and Samsung SDI. It has already commissioned over 200 MW of energy storage for frequency regulation as part of a larger project, which seeks to deploy 500 MW BESS systems for frequency regulation by 2017. In January 2016, KEPCO installed two BESS systems: the 24 MW/9 MWh system at Shin-Gimje and the 16 MW/6 MWh system at Shin-Chungju, both based on lithium nickel manganese cobalt (NMC) oxide storage technology from Kokam. Earlier in 2015, it deployed the first battery systems for this project by installing Kokam’s 16 MW/5 MWh lithium-titanate oxide storage system and LG Chem’s 12 MW ESS at the West-Ansung substation as well as Samsung SDI’s 24 MW ESS at the Shin-Yongin substation. Other ongoing or recently completed storage projects of KEPCO include LG Chem’s 24 MW ESS at the Shin Gyeryong substation; Samsung SDI’s 24 MW ESS at the Shin-Hwasun-gun substation; Incell’s 24 MW ESS at the Ulju substation; LG CNS’s 24 MW ESS at the Uiryeong substation; and Woojin Industrial Systems/LG Chem’s 48 MW ESS at the Gyeongsan substation. KEPCO is also installing a 36 MW ESS at the Non-Gong substation for frequency regulation, which is expected to be completed by the end of 2016. The project features a combination of two of Kokam’s unique lithium-ion battery technologies—its NMC and NANO battery technologies.


In India, the increasing share of renewables in the energy mix, which is expected to reach 15 per cent by 2022, is a key driver for the deployment of energy storage. According to estimates, over 15 GWh of energy storage will be installed in the country by 2020. Utility-scale energy storage is being driven by renewable energy integration as well as grid balancing needs. The private sector is deploying various storage technologies to support their renewable energy projects. For instance, molten salt thermal energy storage was deployed in at least three CSP plants as early as 2013—the 100 MW Diwikar CSP plant and the 100 MW KVK Energy solar project in Rajasthan, and the 25 MW Gujarat Solar One project in Gujarat.


Deployment of BESS systems is gaining popularity for the large solar power plants coming up in the country. In particular, BESS projects associated with large CSP plants are being bid out under the National Solar Mission Phase II. This includes the BESS projects associated with the 100 MW Kadapa Solar Park and 100 MW Ananthapuramu Solar Park in Andhra Pradesh, for which bidding is being conducted by the government-owned Solar Energy Corporation of India Limited (SECI). One of the objectives of these tenders is to showcase India as an upcoming market for utility-scale energy storage solutions.


In the private sector, in April 2016, Panasonic India and AES India announced the building of a 10 MW/10 MWh energy storage facility in Jhajjar, Haryana. Electricity from the project will provide backup and enhance reliability for a Panasonic India manufacturing site. The AES Advancion platform will be used along with Panasonic’s lithium-ion batteries.


The federal TSO Powergrid is also testing various grid-scale energy storage technologies through pilot projects. These include battery technologies like lithium-ion and advanced lead acid for frequency regulation in Puducherry. It has also called for tenders for testing alkaline and flow battery technologies.


China is also acknowledging the inevitability of developing energy storage. This is evident from the mention of energy storage in its recent policy documents including Innovation in Energy Storage Technology Revolution: New Action Plan (2016-30); Outline for the Strategy of Driving National Innovation; Made in China 2025–Plan for Installation of Power Equipment; and Guiding Opinions on Implementing the Internet+ Smart Energy Development. These policies provide a broad outline for innovation in energy storage through pilots and attempts to address various development challenges.


China Energy Storage Alliance (CNESA) estimates that the country’s energy storage capacity will increase exponentially to 14.5 GW by 2020, from around 105 MW in early 2016. CNESA has tracked about 400 MW of energy storage projects that have been announced for the country. System integrators including Samsung, Dalian Rongke and Narada Battery, are the main companies involved in these projects. Popular technologies include lithium-ion, flow, and lead storage batteries. Applications include peak-load shifting and frequency regulation, large-scale renewable energy grid integration, and commercial microgrids.


Further, realising the industry potential, several battery manufacturers and system integrators have collaborated to set up new manufacturing units to produce energy storage equipment in the country. These include the Sungrow Power and Samsung SDI joint venture (investment: USD170 million; production capacity: 2,000 MWh); Shenzhen Clou Electronics and LG Chem (USD3.5 million; 400 MWh); and EVE Lithium Batteries and Neovoltaic. Solar PV manufacturers are also setting up exclusive storage manufacturing companies like Suzhou GCL Integrated Storage Technology Co and Trina Energy Storage.


Provincial governments are providing further impetus to the industry through state-level policies. For instance, the Dalian City government is promoting the research and manufacturing centre of vanadium-flow and lithium-ion batteries through a policy declared in March 2016. Subsequently, in April 2016, the National Energy Administration (NEA) approved Dalian’s 200 MW/800 MWh National Chemical Storage Peak Load Shifting Station demonstration project.


Among the recently commissioned projects is the Zhangbei project in Hebei Province, commissioned in January 2016. The project was jointly launched by the Ministry of Finance, Ministry of Science and Technology and the National Energy Bureau in 2010 and is operated by the North China Power Grid, a subsidiary of State Grid Corporation of China. The project integrates wind power, solar power, energy storage and smart grid transmission technologies. The storage equipment being tested at the site includes an 8 MWh vanadium flow battery commissioned by VanSpar and smaller capacity lithium and lead acid storage batteries and capacitors.


Australia’s energy storage market is also growing rapidly. While residential and commercial applications for energy storage are dominant in the Australian market, some utility-level activity is also taking place. For instance, Powercor Australia, a Victoria-based utility, in April 2016, installed a 2.2 MWh lithium-ion battery system in Buninyong to provide transmission support and ancillary services. In another instance, Ergon Energy, the distribution utility in Queensland, has installed batteries on its single wire earth return (SWER) lines as it is the least expensive option for upgrading local grids. Ergon Energy has deployed a Grid Utility Storage System (GUSS) comprising 25 kW/100 kWh lithium-ion batteries on the constrained SWER lines.


Interest in energy storage continues to grow. As solar and wind capacities become a large part of grid-connected resources, it is likely that policymakers, regulators and utilities will implement incentives for bundling energy storage to firm up those intermittent resources. Grid balancing needs also offer immense potential for developing energy storage. Several demonstration projects are underway across the globe, which will help various storage technologies gain further maturity and become commercially viable for utility-scale applications.