Energy storage: The key to a smarter power grid

Energy grids across the world are struggling to cope with a surge in demand for electricity and increasingly volatile supply from renewable power sources.

Take the UK, where the government is committed to stringent carbon dioxide reduction targets. These can only be met by massively increasing electricity use - which currently accounts for about a third of all energy consumption - from renewables at the expense of oil and gas.

Peak demand on the UK grid is currently 60GW, but by 2050, the government estimates this will increase six-fold as demand for electric cars and household heating soars.

To meet this demand, more pylons and cabling will be needed, adding up to £1,000 a year to consumer bills, according to power services company S&C Electric.

And it's not just about higher demand and cost, as renewable power sources such as wind and solar are, by their very nature, variable - when the wind doesn't blow and sun doesn't shine, little or no power is generated.

As Mike Wilks, at Poyry Managing Consulting, says: "We need more flexibility in our energy mix."

Countries the world over, and particularly those investing heavily in renewable energy, are facing the same problem, and solutions are few and far between.

Increasing fast-acting generation in order to fill energy gaps is one answer, but as most generators of this type, such as diesel turbines, emit CO2, they are somewhat counterproductive.

Another way is to increase connectivity with other countries, but in a world in which national energy security is high on political agendas, this is far from ideal. And besides, as many weather patterns are regional, this is hardly a winning solution.

But there are two ways to help solve this critical problem that should work, both of which are attracting huge sums of money from governments and companies.

The first is energy storage - simply storing energy generated during periods of low demand to use during periods of high demand. Sounds simple enough and, as Anthony Price at the UK's Electricity Storage Network says, it's something that was commonplace 100 years ago.

Not only does storage help overcome the problem of variable supply from renewable energy sources, but it allows electricity grids to operate more efficiently and cost effectively, says Mr Price. This is simply because storage allows "the system to be run at average load rather than peak load", he says.

It would also end the absurdity of paying for wind turbines to be shut down when demand is being satisfied.

And the cost savings could be huge - Imperial College London's Energy Futures Lab has estimated that energy storage technologies could generate savings of £10bn a year by 2050 in the UK.

There are a whole host of technologies to store energy - from pumped hydro to powerful and efficient batteries - that are being developed and implemented around the world, primarily in Germany, Japan, the US and the UK.

Indeed estimates by Lux Research suggest the global industry for energy storage could be worth $100bn in the next few years.

One pilot project is taking place in Painesville, Ohio, where Ashlawn Energy has installed its vanadium redox flow battery, which can discharge 1MW of power for up to eight hours.

"It's very clean, very safe, very long-lasting and can provide power for up to 1,000 homes," says Bill Hagstrand at energy enterprise firm Nortech.

Other installed battery storage projects hold up to 20 times the capacity of Painesville, while pumped-hydro projects can produce more than 1,500MW of power.

Indeed a key benefit of energy storage is that different technologies can be implemented depending on the demand for energy, from small, isolated rural communities to heavily populated cities.

The other significant advantage is it allows power to flow two ways, and therefore complements perfectly the final solution to increasing flexibility of energy grids - demand-side management and smart grids.

This does not involve reducing overall demand, but spreading it out to avoid the peaks that put energy grids under the such stress.

Smart meters may have been introduced to end the costly need for manually reading meters, but they have developed into far more than that. By monitoring constantly energy use in households and linking directly to smart appliances, the time will soon come when these meters take over some of our decisions about energy use.

As Andrew Jones, at S&C, says: "The real change will come when there are enough smart meters to know when to turn things off."

For instance, the meter will be able to turn a fridge off automatically for short periods when electricity is needed elsewhere in the system, or decide when to switch on a washing machine in order to balance the grid as a whole. Such smart appliances are already widely available in Germany.

And with two-way flows of power so essential, not just for energy storage but for small-scale power generation where households and businesses sell energy back into the grid, soon any appliance or device able to store power will be able to feed energy back into the grid.

For example, an electric car battery becomes a potential energy source for the grid rather than just an energy store for the individual. The technology is not there yet, but this integrated smart grid is where we are heading.

And it could save us a fortune, says S&C. It estimates that rather than the £1,000 predicted to be added to UK bills by 2050 to pay for additional infrastructure to meet higher electricity demand, we'd be looking instead at a £100 increase if smart grids and energy storage were fully adopted.

But the story doesn't end there. Energy storage and smart grids mean energy generation and distribution no longer have to be done at a national level - individual households and communities are now able control their own power, and with it the price they pay and the security of supply.

Pilot projects have already been set up in countries such as Germany, Italy, India, China, the US and the UK.

National grids evolved to take advantage of economies of scale and to avoid over-building expensive generating capacity. But the advent of small-scale renewables and energy storage technologies, together with falling generation costs, means that in some instances it makes more sense for power to be generated and stored at a more localised level.

Just as it was, in fact, throughout much of history.