The aging US grid is also in dire need of upgrades, and batteries can cushion the shock of adding gigawatts of wind and solar while buying some time to perform more extensive renovations. Some power markets are finally starting to understand all the services batteries can provide—frequency regulation, peak shaving, demand response—creating new lines of business. Batteries are also a key tool in building smaller, localized versions of the power grid. These microgrids can power remote communities with reliable power and one day shift the entire power grid into a more decentralized system that can better withstand disruptions like extreme weather.
If we can get it right, true grid-scale battery storage won’t just be an enabler of clean energy, but a way to upgrade the power system for a new era.
How Big Batteries Got so Big
Back in 2011, one of my first reporting assignments was heading to a wind farm in West Virginia to attend the inauguration of what was at the time the world’s largest battery energy storage system. Built by AES Energy Storage, it involved thousands of lithium-ion cells in storage containers that together combined to provide 32 megawatts of power and deliver it for about 15 minutes.
“It was eight megawatt-hours total,” said John Zahurancik, who was vice president of AES Energy Storage at the time and showed me around the facility back then. That was about the amount of electricity used by 260 homes in a day.
In the years since, battery storage has increased by orders of magnitude, as Zahurancik’s new job demonstrates. He is now the president of Fluence, a joint venture between AES and Siemens that has deployed 38 gigawatt-hours of storage to date around the world. “The things that we’re building today, many of our projects are over a gigawatt-hour in size,” Zahurancik said.
Last year, the largest storage facility to come online in the US was California’s Edwards & Sanborn Project, which can hold 3.3 gigawatt-hours. That’s roughly equivalent to the electricity needed to power 110,000 homes for a day.
It wasn’t a steady climb to this point, however. Overall grid battery capacity in the US barely budged for more than a decade. Then, around 2020, it began to spike upward. What changed?
One shift is that the most common battery storage technology, lithium-ion cells, saw huge price drops and energy density increases. “The very first project we did was in 2008 and it was on the order of $3,000 a kilowatt-hour for the price of the batteries,” said Zahurancik. “Now we’re looking at systems that are on the order of $150, $200 a kilowatt-hour for the full system install.”
That’s partly because the cells on the power grid aren’t that different from those in mobile devices and electric vehicles, so grid batteries have benefited from manufacturing improvements that went into those products.
“It’s all one big pipeline,” said Micah Ziegler, a professor at Georgia Tech who studies clean energy technologies. “The batteries in phones, cars, and the grid all share common characteristics.” Seeing this rising demand, China went big on battery manufacturing and, much as it did in solar panels, created economies of scale to drive global prices down. China now produces 80 percent of the world’s lithium-ion batteries.
