Good sign for renewable energy: storage batteries continue to tumble in price
Storage batteries for renewable energy. Photo: GE Power
Opponents of renewable energy often cite that solar and wind energy are intermittent and therefore unreliable when the sun isn’t shining or the wind isn’t blowing. Battery storage of renewable resources, however, can make renewable energy incredibly competitive both on a utility and residential scale and new data is backing that up. According to a new report from Bloomberg New Energy Finance, within the past year, the levelized cost of electricity (or LCOE, the cost of a technology delivering energy over its lifespan ) for lithium-ion batteries has fallen 35% to $187/MWh. As Utility Drive explained, the cost of electricity from batteries has decreased by 76% since 2012, making renewable energy combined with battery storage increasingly competitive with coal and gas generation.
Batteries have decreased in price even compared to solar PV and onshore and offshore wind power and new projects over the past year have driven down battery prices substantially. As Greentech Media and Wood Mackenzie reported, “In the past year and a half, several large-scale solar-battery requests for proposals have set record-low prices, including Xcel Energy in Colorado with solar-plus-storage bids as low as $36 per megawatt-hour, compared to $25 per megawatt-hour for standalone solar, and NV Energy reporting even lower bids in its solar and solar-plus-storage RFPs.” However, there was one caveat that demand may not be matching supply:
- It’s worth noting that the current trends in pricing for lithium-ion batteries, what they actually cost today, has been mixed. While continuing technology improvements and increasing scale of manufacturing have continued to push down prices, these have been somewhat counterbalanced in the past year or so by a bottleneck in available supply, driven by a boom in demand from big projects in the U.S. and South Korea.
Why This Matters: Lithium-ion batteries that constitute a majority of rechargeable batteries used today have their limitations but scientists will most likely develop newer technology that can make storage of renewable energy even more efficient. If we have a shot at limiting the amount our planet warms then we’re going to have to rapidly transition to renewable energy sources and having the right battery technology that can make renewables cost-competitive with fossil fuels is key. Especially because, as Earther reported, an analysis released Monday from Energy Innovation, an environmental and energy research firm, found that right now, it’s cheaper to tear down three-quarters of American coal plants and replace them with renewables than to let them continue operating. That number will only continue to rise into the future as renewables continue on their way to becoming among the cheapest sources of energy.”