Wednesday, September 4, 2013

Hawaii Energy Storage 9: A wrapup message: Follow the money



At the end of this series on energy storage, perhaps the best message is an old one in investigations.

Follow the money.

There is no end of storage technologies: regular chemical batteries, flow batteries, pumped storage, flywheels, heat storage and even phase change materials.

Which one will change the face of the energy landscape? That’s not yet clear.

And one reason is cost. Most of these technologies are still very expensive. 

(Here is a good place to insert a notice of conflict. I am an elected member of an electric cooperative board of directors. If lots of people go off-grid, it certainly impacts the finances of the co-op, but as a community co-op it’s also our imperative to serve the members, so if that’s the better alternative for them…)

I talked a while back with the son of an old Wisconsin farmer, who remembers his dad turning down a battery-based electrical system for the farm. At the time, there was no electricity at the farm. Kerosene lamps illuminated the place, and humans or animals did the work, not electric motors.

He turned down the battery system, in part because it was far more expensive than the anticipated power line that an electric cooperative would soon provide him.

“I’ll wait for the wire,” he said.

It costs a utility in Hawai`i $.30 to $.45 per kilowatt hour to deliver power to your house, as it does in other areas dependent on oil-fired power. It's a lot of money. Running your own power system might seem like a slam dunk.

But follow the money.

You may spend $.20 to $.25 per kilowatt-hour or so to make photovoltaic power at home (less with the tax credits included, but they may not be around a lot longer). It can cost another $.25 to $.75 per kilowatt-hour to store that energy for nighttime use—the numbers are all over the place depending on technology and system size and financing. (If anyone wants to nitpick these numbers, I’d be pleased to hear from you.)

If those numbers are good approximations, then without even talking about maintenance, equipment replacement, damage repair and so forth, the cost of your power is at a minimum equal to utility power, and at a maximum much, much higher. 
And and if you’re your own power supplier, you have the added benefit, when the lights go out, of personally responding rather than waiting for a trained lineman.

This is not to say going off-grid can’t work. It has always made sense in some limited applications—like a remote location where up-front infrastructure costs are prohibitive or a utility line isn’t available at all. It is not an accident that most home power magazines describe remote homes, far from existing grids. 

And it’s not to say that going off-grid might not make economic sense soon. When the price to make the power drops to a dime and it costs another dime to store it, that’s when the big crossover comes.

We’re not there yet. But we may be there within a very few years.

For utilities, which benefit from economies of scale, certain storage applications already make sense, but even for them, those applications generally require special situations.

© Jan TenBruggencate 2013

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