Energy Department Aims To Drive Down Battery Costs by 90%

by Natasha Lasky, ODP Staff Writer

This week, Secretary of Energy Jennifer Granholm announced the department’s new goal of reducing the cost of grid-scale, long-duration energy storage by 90% within the coming decade.  The announcement is the second part of the agency’s Energy Earthshots Initiative and, as Utility Dive explained, is dubbed the Long Duration Storage Shot and will encourage the development of batteries with a duration of at least 10 hours, which can help mitigate the day-to-day and seasonal variability of renewable energy.

Why This Matters: Generation of electricity produces 25% of the United States’ greenhouse gas emissions, with about 60% of this electricity coming from coal and gas. To meet the goal of net-zero by 2050, President Biden has made reducing electricity emissions a top priority (with Congressional Democrats echoing these goals). 

A big hurdle to that goal is that wind and solar energy are intermittent and only generate power when the weather permits it. If it’s cloudy or winds lose their force, utilities may still need fossil fuel plants to fill in the gaps. Because of this, cheap batteries with long-term energy storage are crucial to scaling up renewable energy.

Powering Up Battery Production: Right now, many utilities are installing large arrays of lithium-ion batteries, similar to those used in electric cars, to store clean energy. But those batteries typically store electricity for just four to six hours at a time.

Dozens of companies are experimenting with various devices that could store electricity for a longer period of time, while other companies are developing new battery chemistries. Form Energy, a start-up backed by Bill Gates, recently announced it would partner with a utility in Minnesota on a pilot project to build an aqueous air battery that could deliver continuous power for 150 hours.

Can We Make Batteries Cheaper?

The biggest issue with these new batteries is that they’re expensive.

  • One recent study in Nature Energy suggested that battery costs would need to fall below $50 per kilowatt-hour — roughly one-third the cost of today’s grid-scale lithium-ion batteries — before these batteries could be used across the country. 

The good news is that there’s precedent for lowering battery prices.

  • In 2010, a lithium-ion battery pack with 1 kWh of capacity—enough to power an electric car for three or four miles—cost more than $1,000.
  • But according to data collected by BloombergNEF, the figure had fallen to $156 in by 2019.

There’s still a ways to go— the Energy Department wants to drive down the cost of long-duration storage 90 percent below the cost of today’s lithium-ion batteries by 2030.

Jennifer Granholm, the Energy Secretary, emphasized the importance of this in an interview earlier this year: “If we want to get to net-zero emissions, we not only need to deploy solutions that are already proven, like wind and solar power. We also have to figure out how to take clean-energy technologies that have been demonstrated in a laboratory and scale them up in the world. There’s a real sense of urgency about this.”

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