HOT|COOL NO. 5/2024 "ENERGY STORAGE"

Scope, Methodology, and Structure: This study examines efficient and cost-effective storage options using a Smart Energy Systems Approach, showing that optimal storage solutions arise from integrating sub-sectors of the energy system. It synthesizes the authors' prior research, analyzing storage in different energy system segments, storage size, cost, and thermal storage's role. The study also considers cooling, transportation, and biomass integration, demonstrating the benefits of a smart energy systems approach incorporating efficient storage utilization. Electric, Thermal, Gas, and Liquid Energy Storage: There is a fundamental cost distinction between storing electricity and other forms of energy. Electricity storage is storage where inputs and outputs are primarily electricity, though it often involves converting electricity into other energy forms. This conversion process makes electricity storage more expensive than storing thermal energy, gas, or liquid fuels. For instance, thermal storage is approximately 100

times more economical than electricity storage, and gas and liquid fuel storage technologies have even lower investment requirements. These comparisons are based on technologies like underground natural gas caverns and oil tanks. Still, future renewable energy systems could also use methane or methanol from biomass and hydrogen from electrolysis. Beyond investment costs, electricity storage also faces higher losses, especially in conversion. Gas caverns and oil tanks exhibit negligible losses, while thermal storage has about 5% losses, depending on size and retention time. Since electricity storage involves conversion to and from storage, these losses are more substantial. Due to these high investment costs and losses, the economic viability of electricity storage technologies is highly dependent on electricity price variations, which typically occur daily. However, the intermittent nature of renewable electricity sources like wind power tends not to generate significant price variations, making investments in electricity storage economically unfeasible in high-wind power systems like

Price Cycle efficiency

1.000.000

0 10 20 30 40 50 60 70 80 90 100

Figure 1: Investment cost and

100.000

cycle efficiency comparison of

electricity, thermal, gas and liquid fuel storage technologies. See assumptions, details and references in Appendix 1.

10.000

1.000

100

10

1

Electricity - PHS

Thermal

Gas cavern

Liquid Fuel

40

Figure 2: Annualized

35

investment cost per use-cycle vs annual numbers of use-cycles. In the diagram the cost is also benchmarked against the cost of producing renewable energy, here shown for a wide cost span by grey (extension along horizontal axis is for presentation only; there is no cyclic dependence for renewable energy production).

30

25

20

15

10

5

0

0

50

100

150

200

250

300

350

400

Number of cycles per year

Thermal

Electricity

Gas

Liquid

RES production

5

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