Falling Renewable Energy Prices Threaten Energy Storage. Here’s What We Need to Do.
Clean energy and energy storage go together like peanut butter and jelly. But the falling cost of renewable energy threatens to break up this indispensable pair.
According to a new paper in Nature Climate Change, energy storage stands at a critical juncture. For now, energy storage can make wind and solar more profitable, but that may not always be the case.
“If storage isn’t adopted now and renewables’ costs continue to fall, then the added profitability of storage would go away, because at that point it would make more sense to build more solar or wind than it would to install storage,” the study’s co-author, MIT professor of energy studies Jessika Trancik, said in an interview.
Tranick and her colleagues note that, in the near-term, cheap energy storage will support the growth of wind and solar. In the long-term, energy storage could obviate the need for long-distance transmission lines or gas-fired power plants to supply electricity when renewable output dies down. But energy storage must continue to be cost-effective.
Currently, energy storage is profitable in some places and not in others. Trancik says we need to embrace storage where it adds value today. This will help drive down prices to the point where energy storage becomes profitable everywhere.
“There is this window of opportunity where, with limited government incentives — or in some cases without government incentives at all — [energy storage] can make it sense from the perspective of increasing profits,” said Trancik. Once that window closes, it will become much harder to foster the growth of energy storage.