Almost two years after commissioning its revolutionary hot-rock thermal energy storage pilot, Siemens Gamesa is now beginning to roll out its “vast” commercial project pipeline — with a first system of up to 500MWh due to be launched next year.
And the levelised cost of its Electric Thermal Energy Storage (ETES) system has been pushed as low as €40 ($48) per MWh for its ETES Switch platform, which converts conventional fossil-fuel power plants into giant storage hubs, the platform's boss tells Recharge.
“If you use [ETES] to repurpose your coal power plant or give it a second life, 80% of the equipment [you need for ETES] is already there, and then it’s super easy,” says Hasan Oezdem, SGRE’s head of innovation hubs & large energy storage, referring to equipment such as generators, transformers and transmission lines. “Then we go down [in price], even to €40-50 [$48-60] [per MWh]”.
He adds that after the 30MW/130MWh pilot was launched, “the biggest utilities on the planet did come to us, overwhelmingly to be honest”.
When the pilot was launched, explains Oezdem, only one or two big customers approached SGRE to ask about the system.
“Now we have four or five per month really knocking down our doors, from Hawaii to Hong Kong. And I think it also has to do with our reputation as Siemens Gamesa… not only did we prove that we can do it [with the pilot], but we have the muscle power to actually do it again in a bigger version.”
Electricity is used to power a resistance heater and a blower that heats about 1,000 tonnes of basalt rock [for the 30MW/130MWh pilot] to 750°C. When required, cold air is blown through the hot rocks, creating hot air that turns an electricity-generating steam turbine. Due to the effective insulation around the rocks, the heat can be stored for a week or longer.
SGRE has also been inundated with queries from industrial users of high-temperature heat, as Recharge reported yesterday.
“It’s a vast pipeline. It goes from energy-intensive industry companies — chemicals, metals, steel, paper — who just want to have green heat at the demonstrator size, up to the biggest utilities on the planet wanting to really repurpose their latest coal power plants or combined-cycle [gas] plant with is up to 2.2GWh,” says Oezdem.
He declined to provide any more details about forthcoming projects, citing non-disclosure agreements.
“Now I know that I have a vast pipeline, I’m not stressed, or my bosses are not stressed by it, but we rather take it cool — do the concept engineering with the customer and wait for the right business case.”
While long-duration energy storage is undoubtedly needed over the long term — especially as more and more variable wind and solar power comes onto the grid — in most countries, there is currently no business case for such technology.
“The real market is not shaped yet. The framework is still not there,” says Oezdem.
Basic price arbitrage — buying electricity when it’s cheap, storing it and then selling it when prices are high — “doesn’t work [financially] for anyone at the moment”, he explains, adding that countries with competitive capacity and ancillary markets, such as the UK, are among the only places with a viable business case for ETES today.
Nevertheless, Oezdem believes it is inevitable that markets for long-duration energy storage will soon open up, simply through necessity — for both balancing the grid and to make use of shuttered coal-fired power plants.
He cites the examples of coal plant owners in Germany and Greece, where the governments are forcing coal plants to close for climate reasons but do not yet have frameworks in place to enable ETES operators to make a profit.
“They have assets on their books that cannot run, and they would be forced to fire people and shut down the power plant. But with us, for the first time, they have a real opportunity that they can actually run this for 30 years. So there are customers who are really very interested in ETES, in a big bunch.
“And this is the good thing about ETES, we can really tailor it… you don’t have to go black and white and shut down your whole coal plant. We can repurpose it block by block and keep the rest of the power plant producing power.”
But Oezdem is keen to point out that not all coal plants can be cost-effectively switched to ETES, with inefficient older plants being too “messy” to convert.
“Some are absolutely in our sweet spot when it comes to how flexible they are and what pressures and temperature levels they can use, and others are old school, they have a lot of issues… they are not very efficient.”
He adds that engineers from SGRE's biggest shareholder, Siemens Energy, who have been helping to commercialise the technology, told him: “Don’t touch these very old coal power plants. They are too messy.”
And while conversion of conventional power plants is Oezdem’s “favourite” type of ETES development at the moment, due to the sheer scale of its project pipeline, the hot-rock system can equally be used for greenfield energy storage projects and to enable 24-hour baseload wind and solar power — use cases that put SGRE in direct competition with other long-duration energy storage technologies.
“We are getting more and more interest from the PV solar world because of what we can do for them. What all of them need, as an industry, is storage devices that can discharge for 10-12 hours. So for that, lithium-ion batteries are out, because it gets very, very expensive if you try to go beyond seven hours [of full capacity output].”
And as for greenfield ETES projects, the “pull” from the market is not yet there, says Oezdem.
“The problem that [long-duration energy-storage providers] all have is the frameworks. So it's less in our hands, but rather in the hands of governments around the planet.”