Proven renewable technologies such as, solar and wind (offshore and onshore) energy will soon face major cut in subsidies by regulators/governments in many part of the World. An argument is being made against such cuts by developers that sustainable development of renewables still requires support from governments. Can solar or wind competes with coal and gas without any incentives? Perhaps drop of cost of solar panels and wind turbines in recent years, however must be in a long term due to economy of scale. Proven renewables would become marginal and compete with mainstream fossil fuel. It appears that regulators want to slow the momentum of large-scale solar and wind to protect a power-grid from the disruptions until large scale energy storage becomes economically viable. Industry experts know that energy storage will become a next big revolution for the sustainable growth of renewables; furthering on this, a question should be asked “Energy storage, but where in energy supply chain?”, “Generation side” or “Consumption side”.
In order avoid grid disruptions by renewables; part of generated energy at large solar or wind farm could be stored locally and only delivered during peak hours, similar to expensive pump storage/diesel engines. Increased revenue from selling of peak energy (£/MWh) could offset some of the additional cost (£/MW) of storage facility. Regulators should create a payment mechanism for base and peak energy to support the development of “renewables with storage”. Mathematics behind generation side storage is completely different to consumption side. Let’s look at the options to support consumption side storage.
Households and businesses are connected to power grid for 24 hours a day. Cheap/off-peak energy (kWh) could be stored at consumption end, which could be used during peak hours without stressing a power gird. The payback period would depend up on peak energy demand at the particular consumption end. There should be an incentive in place to promote “Consumption end storage” similar to the incentives for roof top solar. The community storages are highly recommended to unfold the full potential.
Finally, it is to conclude that we are about to enter in an era of energy storage. Electricity, a unique commodity, which must be produced and consumed at the same time, will now be stored for balancing the real time supply demand. Learning from the past mistakes, this time regulators should take a lead to make a right choice – Storage at “Generation end” or “Consumption end”.
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