Navigant Research Blog

With New Plant, Alevo Claims Major Battery Advances

— November 10, 2014

Swiss manufacturer Alevo has launched a new battery and grid storage division in North Carolina that it promises will lead to hundreds of megawatts worth of battery-based grid storage projects.  The U.S. subsidiary hopes to manufacture its formulation of lithium iron phosphate (known in the industry as LFP) batteries in the 3.5-million-square-foot Concord, North Carolina factory.

Alevo’s battery chemistry is not new – there are dozens of LFP manufacturers (most based in China) cranking out hundreds of megawatts of batteries for portable power and grid storage applications.  However, Alevo claims that its formulation of the chemistry (primarily its secret electrolyte additives) will enable its LFP batteries to last as long as 43,000 cycles of full discharge.  If such a cycle life is proven in the field, this chemistry will represent the most durable lithium ion (Li-ion) battery available today.

An Impressive Debut

Alevo also claims that it uses a non-flammable electrolyte, which makes its battery less prone to catching fire than most grid storage batteries.  Although the company won’t discuss manufacturing costs, LFP batteries have relatively cheap material inputs, opening up a potential path toward low-cost cells.

During the unveiling ceremony at the Concord plant (complete with a drawing back of the curtains on stage, swirling searchlights, and wolf whistles from the employees that packed the audience – all for a 20-foot shipping container), the air-cooled battery bank was displayed, along with its Parker Hannifin inverter and fire detection and suppression equipment.  Alevo also highlighted its big data and analytics capabilities, which it says are needed to help deploy and optimize the energy storage system.

While Alevo seems to have plenty of capital behind it (Reuters reported that Swiss investors have put up more than $1 billion), as well as several global partnerships, it has significant challenges ahead.  The most important of these focus on the battery cells themselves: real-life durability and manufacturing cost.

Two Challenges

On the durability front, Alevo’s internal accelerated testing of 43,000 deep discharge cycles is indeed impressive.  But accelerated testing is an imperfect science.  Batteries tend to perform very differently in the real world over the course of decades, as opposed to laboratory benchmark tests that model expected long-term battery durability.

As for manufacturing costs, Alevo has a hard mountain to climb to learn how to become a battery manufacturer, especially with the challenges that LFP technology brings to the factory.  Unlike other Li-ion chemistries, LFP requires very finicky vacuum technologies that make large-scale manufacturing hard to do efficiently.  Many other LFP manufacturers have assumed cheap manufacturing costs only to find that the chemistry left them with much higher costs, lower yields, and more failures than expected.  While other cobalt-based Li-ion chemistries have higher costs for material inputs, the manufacturing processes are much simpler and easier to scale.  Alevo’s claims are impressive; proving them will be another matter.

 

Healthy Buildings Get a Boost in New Orleans

— November 10, 2014

With the release of LEED V4, the latest version of its green building rating system, the U.S. Green Building Council (USGBC) is addressing two major components of health: indoor air quality (IAQ) and material transparency.

The former is not a new concept in buildings.  According to Navigant Research’s report, Indoor Air Quality Monitoring and Management, global revenue associated with IAQ is expected to grow at a compound annual growth rate (CAGR) of close to 9% between 2013 and 2020.

As for material transparency, addressing the environmental impacts of chemicals and materials in buildings – and their corresponding health effects – could be a game changer.  By partnering with UL Environment, USGBC will make available Environmental Product Declarations (EPDs) for equipment and materials used in buildings, making transparent what chemicals are near and around people in buildings.

And not a moment too soon.  At the Greenbuild conference in New Orleans, Professor Andrew Whelton of Purdue University presented his findings that polyethylene pipes used for water conveyance in green buildings have been leaching chemicals into the drinking water – above minimum standard levels.  Plastic pipes are used in green building construction because they use less embedded energy in their production and transportation, relative to traditional metal piping.  The direct health implications are not clear from Professor Whelton’s findings, but they certainly provide evidence that the chemical makeup and leaching potential are components worth tracking in buildings that are supposedly environmentally friendly.

Better Buildings = Better Business

Another point of the building-health connection was released in a report by the World Green Business Council, a partner organization to USGBC.   The report, Health, Wellbeing and Productivity in Offices, starts with the overarching premise that the most expensive part of any building is its inhabitants, accounting for up to 90% of operating expenses (it’s not clear if this estimate holds true throughout the developing and the developed regions of the world).  The report analyzes the associated health implications of building siting, design, and operations on qualitative and qualitative metrics like occupant health outcomes, well-being, and perceived benefits, as well as organizational and corporate financial outcomes.  For example, an office environment that forces employees to walk around can improve their overall health, reducing absenteeism and physical complaints.  Another example: a 2011 article in the journal Indoor Air indicated that relative to standard temperature baselines in an office, employees were 4% and 6% less productive at cooler and warmer temperatures, respectively.

Greenbuild also hosted Acting U.S. Surgeon General Rear Admiral Boris D. Lushniak. Rear Admiral Lushniak challenged the audience to design preventive healthcare into the built environment, making healthy buildings the default, rather than a specialty.  He also advocated for a “Blue Movement” focusing on human health, like the Green Movement addresses sustainability and environmentalism.  Rear Admiral Lushniak ushered the concept of integrating health into building design, function, and operations for the green building community with passion.

 

Building on Big Data

— November 10, 2014

Advanced methods of interpreting large volumes of data have brought innovations in areas such as healthcare/pharmaceuticals, meteorology, marketing, e-commerce, government services, national security, and financial services.  Despite success in other areas, though, big data is only beginning to have an impact on building automation and energy efficiency.  In a 2013 blog, my colleague Bob Gohn discussed big data in the context of buildings.  In this blog, I’ll take a look at some of the solutions emerging in this area and how the buildings industry will be affected.

Continual Correction

Currently, the most common use for big data in buildings is fault detection and predictive maintenance.  Advances in sensor technology have enabled unprecedented views into the status and functionality of building systems such as heating, ventilation, and air conditioning (HVAC).  Sensors are capable of regularly measuring every aspect of the system’s performance by analyzing the data to identify equipment that needs to be replaced or may be about to fail.  Bringing technicians onsite to service equipment can be a major expense for building owners.  This type of data analytics allows a diagnosis to be made before the technician arrives, while also providing information on replacement parts and other relevant items. Data analytics solutions can also build a list of the known problems in a building and derive each piece of equipment’s usage and cost, enabling a quantitative return on investment (ROI)-based assessment of which upgrade or investment should be implemented first.

As building automation and data analytics continue to advance, new applications within the buildings industry are emerging.  Advanced building energy management systems (BEMSs) harness large quantities of data to provide a visualization of the overall energy consumption of a building or portfolio of buildings.  These systems also have the ability to leverage historical data to provide recommendations for how to best reduce consumption.  Next-generation BEMSs have the capability to adjust building system parameters automatically to maximize occupant comfort and energy efficiency.  One example of this type of advanced system is SHIFT Energy’s Intelligent Live Recommissioning (ILR) solution, which provides ongoing re-adjustments.  Another cutting-edge solution is offered by Ecorithm, whose program also includes richly detailed graphics to visualize processed data across a building’s floor plan, identifying areas of waste and recommending corrections.

Designed with Data

Big data is also playing an increasingly important role in the design of resource efficient buildings.  Building information modeling (BIM) programs allow architects to analyze key performance metrics such as natural ventilation, daylighting, solar heat gain, overall energy usage, and even how people will likely interact with spaces.  These programs utilize vast amounts of data from existing buildings to visualize how a conceptual building may perform.  Such analysis can speed the construction of new buildings by leveraging the data-rich plans from previous projects, modified to fit the specific characteristics of the new site.  This also allows designers to cut costs by eliminating the duplication of work from past projects.  Reducing the time and cost required to construct new buildings is an essential factor in addressing rapidly growing urban populations that lack sustainable buildings and infrastructure.

Despite these achievements, the buildings industry is not yet exploiting available data to the extent that other industries are.  Looking forward, advances in building design, construction, and management can leverage big data and advanced analytics to reduce costs and improve efficiency.  As buildings and cities become increasingly automated and digitalized, data analytics will play a growing role in energy efficient buildings.

 

Energy Storage Enjoys a Breakthrough Day

— November 5, 2014

While most Americans were paying attention to election results, news emerged out of California that truly heralds a new era for the energy storage industry.  Southern California Edison (SCE) announced that it will acquire 2,221 MW of new generation assets, of which 250 MW will be energy storage systems.  This is the end result of the lowest-cost resource request for proposal (RFP) that is designed to eventually replace the generation provided by the shuttered San Onofre nuclear power plant.

While the sheer scale of the announcement is staggering (no utility has ever purchased 250 MW of non-pumped hydro energy storage before), the details of the announcement are even more impactful.  SCE was expected to use some of this bid for energy storage (it listed energy storage as a preferred resource on the RFP), and Navigant Research assumed the energy storage part of the purchase would be about 50 MW.  By ordering 5 times that amount of energy storage, SCE is making a very loud statement about how highly it values energy storage as a grid management tool.

The Land Rush Begins

Another important aspect of this move is that it was done on a completely level playing field.  SCE decided to purchase 250 MW of energy storage because it felt it had a higher value than any other generation asset (including natural gas, wind and solar).  That in itself is an extremely important positive note for the energy storage industry.

Even more important for the industry is that SCE’s big vote of confidence for energy storage happened just before the launch of three big RFPs that were designed as part of the energy storage mandate that California is forcing on the big utilities.  By December 1, 2014, all three of the large investor-owned utilities in the state will introduce a total of more than 200 MW of energy storage purchases.  It’s the energy storage industry’s equivalent of the Oklahoma land rush.

Other Big Deals

A couple of other important nuggets regarding the SCE announcement:

  • AES Energy Storage will be building a 100 MW battery plant that will dwarf all existing battery power plants.  Over the last few years, AES Energy Storage has discussed how such a plant might work, but now it will have a chance to actually implement a battery peaking plant.  If this project is successful, it will open up a completely new business model for the energy storage industry that could, in the long run, be the largest segment of the stationary storage market.
  • San Francisco-based startup STEM won an 84 MW contract that will make up hundreds (if not thousands) of distributed battery packs working on the customer side of the meter.  Like many other behind-the-meter energy storage system integrators, STEM has preached the concept of distributed battery packs that, in aggregation, work like a virtual power plant (see Navigant Research’s report, Virtual Power Plants).  STEM will be the first company to implement such an idea at scale in the real world.  If it succeeds, then other players like Coda Energy and GreenCharge Networks will also benefit.

Whatever your politics, for the energy storage industry it is morning in America.

 

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