What does an energy storage system look like?

Energy storage systems have changed dramatically over the years. Learn about traditional systems and explore leading-edge technology

By Kevin Krause, PE, LEED AP, Affiliated Engineers, Madison, Wisconsin January 27, 2020

Learning objectives

  • Understand the various energy storage systems available.  
  • Learn how energy storage systems can benefit building owners and operators.  
  • Consider cutting-edge next-generation technologies.  

The need for robust, efficient and economical energy storage is growing on pace with the all-electric transitions of the utility and transportation sectors. Batteries, capacitors, kinetic energy, thermal and hydrogen storage represent today’s technology options, each with distinct benefits depending on the intended application. 

As global economies transition toward all-electric energy and vehicles and energy production itself transitions to distributed, discontinuous renewable sources, the need for robust, efficient and economical energy storage is sharply ratcheting up.  

Energy storage technologies are playing a growing role in the evolution of present-day facility and utility energy supply systems. The total energy storage capacity in the United States has now surpassed 2 gigawatt-hours, with recent year-to-year increases of interconnected storage approaching 50%. The industry continues to evolve, adapting and innovating in response to a changing energy landscape and advances in technology.  

As the percentage of continuous carbon-based production in the energy mix gives way to the more time-fixed production of renewables, energy storage represents the means by which sporadic supply can effectively be synchronized with fluctuating demand throughout any given day. As energy storage technologies and strategies advance, we begin to see the possibilities of energy independence. 

Energy storage systems 

A variety of means and advanced technologies are used to capture energy produced at one time for use at a later timeWhile electrical and thermal energy storage systems are the most prevalent in today’s facility and utility system design, all offer utility companies, utility customers and building occupants benefits of greater resiliency, cost savings, energy efficiency and sustainability. 

Electrical — The largest growth in installation of energy storage systems over the past decade has been in electrical systems, such as batteries and capacitors. Lithium-ion batteries are quickly becoming the workhorse of electrical energy storage systems, commonly applied in today’s large battery energy storage systems and in the quickly growing fleet of electrical vehicles on the road. Through the first quarter of 2019, 900 megawatts of utility scale battery storage are online.  

Flow batteries also have been under further development and may be applicable, subject to the peak capacity and energy duration timeframe required. Capacitors are devices that store electrical energy in the form of electrical charge accumulated on their conductive metal plates. When a capacitor is connected to a power source, it accumulates energy that can be released when the capacitor is disconnected from the charging source and in this respect they are like batteries. The difference is that a battery uses electrochemical processes to store energy, while a capacitor simply stores charge. As such, capacitors can release the stored energy at a much higher rate than batteries, since chemical processes need more time to take place. 

Mechanical — Mechanical energy storage systems use basic concepts of physics, converting electrical energy into potential or kinetic energy storage and converting it back to electrical energy when needed. Common systems based on this approach include larger pumped hydroelectric dams, mechanical flywheels and compressed air storage. 

Thermal — Thermal energy storage allows for thermal energy (hot or cold) to be stored and used later to balance energy demand between daytime and nighttime or varying thermal seasons. Most often in the form of water tanks, cooling water or heating water can be generated at times of lower energy rates and then dispatched during peak times, supporting peak-shaving strategies. Other thermal energy storage systems and media include molten salts, ice storage and cryogenics. 

Chemical — In addition to battery systems that typically are based on an electrochemical process, other chemical energy storage systems also are available for consideration and application. Hydrogen storage uses electrical energy to generate hydrogen via electrolysis. The hydrogen is then compressed and stored for future use in hydrogen fueled generators or fuel cells.  

This approach can store large amounts of energy, however, it is not necessarily the most efficient means of doing so. The large amount of energy required to isolate hydrogen from water, natural gas or biomass, package the gas by compression or liquefaction, transfer the energy carrier to the user, plus the energy lost when it is converted to useful electricity with fuel cells, leaves around 25% for practical use. 

Energy storage benefits 

Energy storage systems can support sustainability, cost reduction and resiliency goals. The return on investment will be dependent upon the local utility pricing structure, any available utility incentive programs for peak reduction, on-site energy generation capability and a given facility load profile. Energy storage systems also are valued for their rapid response  most storage technologies can begin discharging power to the grid very quickly, while fossil fuel sources tend to take longer to ramp up. This rapid response is important for ensuring stability of the grid when unexpected increases in demand occur. 

Backup power — Energy storage systems can serve as a reliable source of backup power in case there is loss of power from the grid due to severe weather conditions or other issues. By helping facilities remain operational, energy storage systems eliminate costs of downtime and provide increased resiliency to critical operations. 

Peak shaving and load shifting — The demandresponse functionality of energy storage systems allows for participation in incentive utility provider programs designed to reduce power consumption during periods of peak demand. 

The price of energy typically is at its highest during periods of peak demand. Traditionally, peak shaving has been accomplished by shifting the actual loads to a time of lower peak demand. If the loads themselves or their time of impact cannot be adjusted, the application of energy storage should be considered.  

Energy storage systems can support peak shaving to reduce expensive energy costs. With peak shaving, an energy storage system such as a battery is charged during periods of low demand. These times may be overnight or during times of lower peak during the day. The battery is then discharged during periods of high demand, mitigating the effects of large load blocks within a facility or utility gridThis is particularly economical for utility customers whose rate is based on peak demand. 

Load shifting (also referred to as “tariff management”) is like peak shaving, but instead of focusing solely on peak pricing, it focuses on reducing overall kilowatt-hour costs. In effect, it takes advantage of the difference between low-cost energy and high-cost energy, storing power when costs are low and discharging it when costs are high. Load shifting typically provides incremental value to a system that is already providing other benefits, like peak shaving. 

Renewable energy and the “duck curve” — When a renewable energy source is unable to supply the current demand based on weather impacts such as loss of solar or wind or when available generation does not align with peak power demands, an energy storage system can span the gap and supply the additional energy required. Without energy storage or other controllable generation sources, the fluctuations in renewable energy sources can create disruptive imbalances in maintaining a stable grid.  

Energy storage also captures surplus energy generation from renewables shifting the energy to later periods of high demand. This is particularly the case in areas of high numbers of solar installations, such as California, where the grid is being saturated with photovoltaic power during times when the grid is unable to use it. This phenomenon is often described as the “duck curve (see Figure 3).  

The duck curve shows net power load over the course of a day. (The origin of the term can be traced back to the California Independent System Operators, around 2012.) To explain further, consider areas where the peak demand of energy occurs after sunset, when solar power is no longer available. Where that grid is largely using solar power during the daylight hours, sources other than PV need to be available to pick up the load at peak time.  

This power demand curve representing the total load, minus power produced from PV, resembles the silhouette of a duck. One of two options is required of the grid at point of peak demand. Utilities must either dispatch other energy generation sources or rely on energy storage to pick up where the real-time PV production left off. Because energy storage is much more flexible and quicker to come online  as well as more costeffective and sustainable  it is the preferred option.  

As the phenomenon of the duck curve becomes more prevalent, there is a growing disparity in hourly energy rates. In the past three years, afternoon energy rates in California have shown to double their per megawatt-hour cost while midday pricing has decreased dramatically to levels of $15 per megawatt-hour because of the oversaturation of PV. Battery energy storage can help mitigate these issues and help smooth the variability of time of day rates. 

Power quality — Energy storage systems offer the benefit of frequency regulation. This allows a given facility to help support the overall power grid and one of its main objectives, to deliver a constant frequency. The grid is perpetually balancing supply (generation) and demand (consumption). The ability of an individual energy storage system to absorb or release power or release energy quickly represents a potential revenue-generating balancing service, as well as necessary further protection from the power quality issues often associated with renewable energy sources. 

Increased utility demand charges are often related to facility loads with low power factors. A higher cost is paid for lower power factor and low power factors can cause power quality issues. An energy storage system can improve a facility’s power factor, simultaneously delivering power quality improvement and saving money on monthly utility bills. 

Fourth-generation utility systems  

Energy storage is playing more critical role in district heating and cooling systems. District heating systems have been in use since the 1880s and continue to evolve. Through a district energy system, various heating and cooling sources can be augmented with storage. As new ideas and technologies emerge, greater efficiency and diversification are possible.  

In the 2015 publication District Energy in Cities: Unlocking the Potential of Energy Efficiency and Renewable Energy (2015), the United Nations Environment Programme, refers to the future standard of district energy systems as “fourth-generation systems.” Delivery of district heat alongside energy efficiency programs via transition to fourthgeneration systems allows for more waste heat and renewables in the energy system and enables the balancing of variable renewables such as solar and wind.  

Fourth-generation systems operate at lower water temperatures, resulting in reduced heat loss compared to previous generations and make it possible to use diverse sources of heat, such as low-grade waste heat, geoexchange, solar thermal, combined heat and power and heat recovery. Combined with thermal energy storage and smart controls, a fourth-generation system is an economical way to integrate renewable energy and energy storage into an energy grid portfolio.


Electrification of energy generation, transportation 

Modern energy and utilities systems are becoming more electrified. As a greater amount of distributed energy generation or distributed energy storage is deployed, any combination of local fuel-based or renewable energy sources (e.g., natural gas generators, microturbines, fuel cells, solar PV, distributed wind, combined heat and power cogeneration systems) or energy storage technologies as described earlier, needs to be able to be interconnected to serve the loads of a facility, campus, city or other defined district. The use of electrical energy in lieu of burning fossil fuels by chilled water and heating hot water systems maximizes the use of electricity generated by renewable energy sources as well as electrical energy storage systems. Electrical distribution and transmission systems need to be able to accommodate this greater electrification of sources and loads 

For several years, microgrids have continued to emerge as the system to do just that. As a localized electrical network, campuses and other similar-sized districts are able to generate and store electric power from various distributed energy resources, including renewables. Balancing captive supply and demand resources  including thermal and electrical load  within its defined boundaries, a microgrid system provides resiliency, energy efficiency and cost savings  

As consumer choice of electrical vehicles and other electrified transportation alternatives become more mainstream, the need for electrical infrastructure to provide energy supply to these electrified vehicles will increase dramatically. Similar to the varying output of renewable energy sources, the varying load of electrical vehicle charging is likely to exceed the energy generation systems’ ability to keep up.  

It’s easy to envision this likelihood at such times as when employees all arrive at work simultaneously and plug in, or the reverse when people return home at the end of the day and plug in at the same time. Integrating additional energy storage resources into our electrical system can help to provide the required energy in a most economic fashion, by using energy stored during low-peak times and being ready to react quickly during the times of increased vehicle charging. 

First generation (1880 to 1930) 

  • Localdistrictheating 
  • Hightemperature steam systems
  • Coal

Second generation (1930 to 1980) 

  • Districtheating
  • Pressurized hightemperature hot water
  • Combined heat and power
  • Coal, heating oil 

Third generation (1980 to 2020) 

  • Districtheating
  • Midtemperature hot water
  • Combined heat and power
  • Gas, coal, heating oil, biomass
  • Large-scale solar

Fourth generation (2020 to 2050) 

  • Districtheating
  • Lowtemperature hot water
  • Central heating and cooling 
  • Electrical andthermalenergy storage 
  • Heat recovery
  • Combined heat and power
  • Biomass
  • Geoexchange
  • Renewableenergy:photovoltaicswind 

Kevin Krause, PE, LEED AP, Affiliated Engineers, Madison, Wisconsin
Author Bio: Kevin Krause is a principal with Affiliated Engineers Inc. His expertise spans the energy spectrum from the most efficient production and distribution, through highly regulated use, including work for the U.S. Department of Energy’s National Renewable Energy Laboratory and the California Air Resources Board.