Technology Choices for Energy Storage
In this second part of this article, Asif Hussain, SVP of Strategic Business Development, Sumitomo SHI FW continues to elaborate on how Sumitomo Heavy Industries Ltd. (SHI) and Sumitomo SHI FW (SFW) has partnered with Highview Power to deliver HVP’s liquid air energy storage technology to markets around the world.

Flywheels and Super-Capacitors
Flywheel and super-capacitor technologies are best suited for small scale (up to 1 megawatt (MW)) ES applications requiring instantaneous response. They can absorb or deliver small bursts of power for durations spanning seconds to a few minutes. They are typically used to meet high power quality standards (tight tolerances on voltage and frequency) required by data centers, laboratories and sensitive manufacturing processes.

Size, cost and safety issues grow along with the scale of these technologies making them unsuitable for larger scale applications.

Li-ion Batteries
Li-ion battery technologies have become the default choice for ES plants in the small to medium size range (up to 100 MW, under 4 hours of duration) driven mainly by their high siting flexibility and growing supply chain from the electric vehicle (EV) sector. Beyond this scale, the cost and size of the ES plant become uncompetitive to the larger scale options.

At any scale, the main drawback of battery technologies is that they continuously lose capacity each time they charge and discharge. For ES applications, this imposes a significant limitation on the revenues that a li-ion plant can realize in energy peak shifting and energy arbitrage markets. At the same time, it drives up plant life cycle cost since the battery modules need to be replaced every 8-12 years and oversized to account for their continuous capacity decay.
From an environmental aspect, the need to dispose or recycle spent battery modules is potentially the ultimate limiting factor for the growth of batteries in both the ES and EV sectors. At these large scales, a gigaton stream of waste batteries may become an insolvable problem both economically and ecologically.

Pumped Hydro
For the largest scale (gigawatts (GW) of power capacity over 8 hours), pumped hydro (PH) has been the dominant choice. In fact, PH represents 93% of all ES plants operating in the world today on a megawatt capacity basis and 99% on a megawatt-hour capacity basis. At this scale, response time is not as important (5 min or longer), since the common application for these large plants is shifting energy from a few hours to days, providing capacity and operating reserve margin to the grid.

Even though PH has been the long-standing dominant choice for ES plants, its future growth is limited due to its limited locational flexibility. PH has been built at most of the naturally occurring water reservoirs, rivers and manmade dams. Disruption of both wildlife and human habitat make permitting of new projects difficult and goes against the need for a more distributed system of ES plants needed across the grid to support high levels of wind and solar power.

Compressed Air
Compressed air energy storage (CAES) which stores energy as compressed air in underground caverns has been another available option at the large scale, but not a popular one with only two plants built since 1978. Like PH, this is mainly due to its limited locational flexibility.
CAES plants need to be located above large, underground salt and limestone caverns, aquifers or depleted oil and gas reservoirs. Cavern evaluation and permitting can be expensive and time-consuming, exposing developers to significant investment risk well before the viability of the project can be determined.

From an environmental aspect, standard CAES plants cannot be considered a clean technology. To discharge its stored energy, the pressurized air is heated by a fossil fuel combustion process before it is expanded in a gas turbine to power an AC generator. The process is very similar to a peaking combustion turbine emitting carbon-dioxide to the atmosphere.

Newer designs, not yet demonstrated, offer an emission free solution by replacing the combustion process with heat stored from compressing the air.

Liquid Air
Liquid air energy storage (LAES) is a clean, compact version of CAES. By liquefying air, a LAES plant reduces the volume of air by a factor of 700 as compared to CAES which achieves only a 40-70 reduction factor by compressing air. This allows a LAES plant to be very compact storing air at low pressure cryogenic conditions in insulated tanks instead of as compressed air in large underground caverns as does CAES. A LAES plant has no emissions since it doesn’t burn a fossil fuel to reheat the air for energy recovery as does CAES.

A LAES plant has the gigawatt scalability of PH with the advantage of being flexibly located across the grid with its only site requirement being a grid connection. Liquid air plants avoid the expensive, long and uncertain permitting and construction process associated with constructing water reservoirs, dams, drilling and sealing of underground caverns needed in the construction of CAES and PH plants. Highview Power, the leading developer of liquid air technology likes to say “Liquid air is pumped hydro in a suitcase”, due to it very compact footprint.
With normal maintenance, a LAES plant maintains its original energy storage capacity and round-trip efficiency over a long 30-year plant life without the need to replace major plant components. At the end of its life, recycling of LAES plant components and restoring or repurposing the site does not pose any significant long lasting environmental or site cost liabilities.

Comparing to Li-ion battery ES plants, for the same storage capacity, a LAES plant can be built on a site 5-10 times smaller than that needed for Li-ion ES plant and can achieve a much lower levelized cost of storage (LCOS), due to its full discharge flexibility, long plant life and low O&M cost.

More importantly, analysis shows that the cost for replacing the battery modules every 8-12 years (depending on the number of charge/discharge cycles) was the overwhelming factor driving up the LCOS of the Li-ion plant.
Together, these two factors result in a 37% higher LCOS for the Li-ion plant as compared to the LAES plant on a monthly fixed cost basis ($/month per kilowatt of plant capacity).

On a discharge energy basis ($ per MWh of energy discharged by the plant), the LCOS of the Li-ion plant grew to a much larger 69% above that of the LAES plant. This is because the Li-ion plant could not fully discharge its capacity daily, falling short of capturing the maximum revenue available from the fixed 50 $/MWh energy arbitrage assumed in the analysis. The Li-ion’s plants daily charge/discharge cycles were limited to a 50% depth of charge (200 MWh of total 400 MWh capacity) to maintain a reasonable battery module replacement frequency of 10 years based on NREL’s SAM modeling.

If the Li-ion plant was fully discharged each day to capture the full energy arbitrage revenue, the increase in battery module replacement cost would have resulted in a higher LCOS for the plant. In contrast, the LAES plant was fully discharged daily and captured the full energy arbitrage without a significant impact on plant maintenance cost or life.

One important note about this analysis is that the cost to dispose or recycle the spent Li-ion battery modules was not included as part of the battery replacement cost. Battery recycling and disposal cost are not known today since the cost for landfilling or recycling large li-ion batteries is in a very early stage.
This comparison also shows that over a 30 year period, the much higher plant round trip (charge-store-discharge) efficiency (RTE) of the Li-ion plant (85% vs. 55% for LAES) coupled with the future decline in Li-ion battery cost (both accounted for in the analysis) are not great enough to offset short life and cycling limitations of the Li-ion battery.

Table 1 summarizes the benefits that each technology offers to the ES markets. As can be seen, liquid air brings the most benefits to the largescale ES market. In fact, liquid air scores in every metric except for round trip plant efficiency, which turns out to not have a strong impact on overall project economics.

Even though, the Li-ion plant has a much higher RTE than a LAES plant (85% vs. 55%), it is unable to generate enough revenue from the market to provide a 12% return to investors.
Whereas, the LAES plant can achieve the 12% investor return due to its much lower revenue need and ability to fully discharge its energy each day. These factors have a much greater impact to project economics than does RTE.

The energy revenue component is simply not large enough for the RTE to change this outcome. This is due to the limited peak-off-peak energy price range and duration available in all markets today. Li-ion plants are further disadvantaged by their charge/discharge cycling limitation, which prevents them from fully capturing the available arbitrage, no matter its range.

Taking A Closer look at Liquid Air and its Development
Highview power (HVP) is a UK company that has been developing and commercializing LAES technology since 2005. HVP has optimized the process and plant design to be more efficient, compact and cost competitive backed by pilot and demonstration plant testing. They have established 15 patents protecting the technology which they have trade named as “CryoBattery”.
Their efforts can best be seen in their achievement of more than doubling the plant’s RTE from 25% to 55%. An important breakthrough for this was related to storing and utilizing waste heat and cold energy between the liquefaction and air reheating processes. The design is flexible enough to integrate nearby external waste heat and cold energy sources, such as from a gas turbine peaker plant’s hot exhaust gas, LNG regasification waste cold, or hot gas from a steel furnace, boosting RTE of the LAES plant to as high as 80%.

Liquid air is a newcomer to the ES market, demonstrated by a 2.5 MWh pilot plant located near London and a 15 MWh commercial plant in Manchester UK, both providing ES services to the UK grid for a period of a few years. But its processes and all its components are all well proven within the power, LNG and industrial gas sectors.

The air liquefaction and storage process is commonly used by the LNG and industrial gas sectors originally invented by the French engineer, George Claude, in 1902. The expansion of the air in the turbine generator to produce electricity is commonly used in the power and many industrial sectors.

The SHI/SFW/HVP Partnership
Sumitomo Heavy Industries Ltd. (SHI) and Sumitomo SHI FW (SFW) has partnered with Highview Power to deliver HVP’s liquid air energy storage technology to markets around the world. As part of the partnership, SHI invested $46 million into HVP.

The HVP/SFW team couples together a technology and project execution company with the global delivery network needed to bring liquid air technology to the market. HVP and SFW will provide the technology together and SFW’s global execution reach will provide the ability to deliver a range of scopes to projects from design and engineering to full plant EPC delivery.
SFW brings over 100 years of power and industrial project execution experience to the HVP team from its roots as Foster Wheeler. The SFW company was formed through business combination between Sumitomo Heavy Industries and Foster Wheeler’s circulating fluidized bed and power services business in June 2017.
This partnership is right in line with SHI’s and SFW’s mission to provide innovative energy solutions to customers for decarbonizing and decentralizing energy.