Energy Storage for the Grid and Ancillary Services

Peak Pricing Arbitrage, Generation Capacity, T&D Asset Capacity,
Frequency Regulation, Volt/VAR Support, and Renewables Ramping/Smoothing

Utility-scale energy storage is expected to continue breaking into the mainstream electricity industry in 2016. The market is projected to move away from R&D projects and push toward full commercial deployments. While most new activity is concentrated in select regions and markets, grid operators around the world are beginning to recognize the value that large-scale energy storage systems (ESSs) can provide. Specific market dynamics and trends vary throughout the world, but there are overarching factors driving the market and technologies forward.

Perhaps the most important driver of energy storage for the grid and ancillary services (ESGAS) is the substantial growth in the amount of renewable energy being deployed around the world. As the percentage of variable generation increases, energy storage can help grid operators maintain system stability and ensure the efficient integration of these new, clean resources. There are several other key macro trends driving ESGAS markets, including the rapidly falling prices of ESSs and the growing need for new electrical infrastructure around the world. According to Navigant Research, global installed ESGAS power capacity is expected to grow from 1.1 GW in 2016 to 21.6 GW in 2025.

This Navigant Research report explores the growing opportunities for ESSs to provide numerous services to the grid and how these markets will evolve in the coming decade. All major technologies for utility-scale energy storage, including advanced batteries and electromechanical systems, are covered in this report for the six top services that energy storage can provide. Global market forecasts for power capacity, energy capacity, and revenue, segmented by region, technology, and application, extend through 2025. The report also examines the key business models related to ESGAS, as well as the competitive landscape.

Key Questions Addressed:
  • What are the leading applications and services on the grid for energy storage?
  • How large is the global market for energy storage for the grid and ancillary services (ESGAS)?
  • How will the mix of services being provided by energy storage change by region?
  • How quickly will the global market for bulk and short-duration energy storage grow and why?
  • Which energy storage technologies for power and energy services will lead the market?
  • What countries and global regions will lead the market for grid-scale energy storage?
  • Which markets should each ESGAS technology provider target and why?
Who needs this report?
  • Energy storage developers and independent power producers
  • Engineering, procurement, and construction (EPC) firms
  • Renewable energy development financing companies
  • Smart grid controls and software companies
  • Inverter and other balance-of-system vendors
  • Utilities
  • Government and regulatory agencies
  • Investor community

Table of Contents

1. Executive Summary

1.1  Introduction

1.2  Market Drivers

1.3  Market Challenges

1.4  Report Scope

1.5  Market Forecast

2. Market Issues

2.1  Applications for Energy Storage on the Grid

2.1.1  Electricity Cost Optimization

2.1.1.1  Peak Pricing Arbitrage

2.1.2  Load Serving

2.1.2.1  Generation Capacity

2.1.2.2  T&D Asset Capacity

2.1.3  Grid Operations

2.1.3.1  Frequency Regulation

2.1.3.2  Volt/VAR Support

2.1.4  Renewables Ramping/Smoothing

2.2  ESGAS Business Models

2.2.1  Merchant Model

2.2.1.1  PJM Ancillary Services Markets

2.2.1.2  Germany Ancillary Services Markets

2.2.2  Utility-Owned

2.2.3  Capacity Contracts

2.3  Regional Market Issues

2.3.1  North America

2.3.1.1  California

2.3.1.2  Ontario

2.3.2  Europe

2.3.2.1  Italy

2.3.2.2  Germany

2.3.2.3  United Kingdom

2.3.3  Asia Pacific

2.3.3.1  Australia

2.3.3.2  China

2.3.3.3  India

2.3.3.4  Japan

2.3.3.5  South Korea

2.3.4  Rest of the World

3. Technology Issues

3.1  Overview

3.2  Advanced Batteries

3.2.1  Flow Batteries

3.2.2  Advanced Lead-Acid Batteries

3.2.3  Li-ion Batteries

3.3  Compressed Air

3.4  Flywheels

3.5  Molten Salt Batteries

3.6  Power-to-Gas (P2G)

3.7  Pumped Hydro Storage

3.8  Ultracapacitors

3.9  Other Advanced Battery Chemistries

3.10  Energy Storage Enabling Technologies

3.11  Hybrid Energy Storage Systems

4. Key Industry Players

4.1  Flow Battery Vendors

4.1.1  Gildemeister

4.1.2  Sumitomo Electric

4.1.3  ViZn Energy

4.2  Flywheel Vendors

4.2.1  Amber Kinetics

4.2.2  Beacon Power

4.2.3  Temporal Power

4.3  Power-to-Gas (P2G)

4.3.1  Hydrogenics

4.3.2  ITM Power

4.4  Ultracapacitors

4.4.1  Maxwell Technologies

4.4.2  Win Inertia

4.5  Li-Ion Vendors

4.5.1  Leclanché

4.5.2  LG Chem

4.5.3  Saft

4.5.4  Samsung SDI

4.6  Software and Systems Integration

4.6.1  Software-Focused Vendors

4.6.1.1  1Energy Systems

4.6.1.2  Greensmith Energy

4.6.1.3  Younicos

4.6.2  Project Development Focus

4.6.2.1  AES Energy Storage

4.6.2.2  GE Energy Storage

4.6.2.3  LG CNS

4.6.2.4  NEC Energy Solutions

4.6.2.5  RES Americas

4.6.2.6  S&C Electric

5. Market Forecasts

 5.1  Methodology

5.2  ESGAS System Costs

5.3  Power Capacity

5.4  Energy Capacity

5.5  Revenue

5.6  Conclusions and Recommendations

6. Acronym and Abbreviation List
7. Table of Contents
8. Table of Charts and Figures
9. Scope of Study, Sources and Methodology, Notes

List of Charts and Figures

  • Installed ESGAS Energy Capacity by Region, World Markets: 2016-2025
  • Installed ESGAS Energy Capacity by Technology, World Markets: 2016-2025
  • Installed ESGAS Energy Capacity by Application, World Markets: 2016-2025
  • Installed ESGAS Revenue by Region, World Markets: 2016-2025
  • Installed ESGAS Revenue by Technology, World Markets: 2016-2025
  • Installed ESGAS Revenue by Application, World Markets: 2016-2025
  • Depiction of Frequency Regulation
  • PJM Interconnection Coverage Area Map
  • Historical PJM Regulation Market Clearing Prices
  • Germany’s TSOs
  • Historical TenneT Prices for Up and Down Regulation
  • Installed ESGAS Power Capacity by Application, World Markets: 2016-2025
  • ESGAS Installed Power Capacity by Technology, World Markets: 2010-1Q 2016
  • Total Annual Installed Power Capacity of Variable Generation Resources, World Markets: 2016-2025
  • ESGAS CAPEX Assumptions by Technology for Power Services, Average Installed Costs, World Markets: 2016-2025
  • ESGAS CAPEX Assumptions by Technology for Energy Services, Average Installed Costs, World Markets: 2016-2025
  • Installed ESGAS Power Capacity by Region, World Markets: 2016-2025

List of Tables

  • SDG&E Existing Authorized Capacity for the 2014 Cycle
  • SDG&E Newly Proposed Energy Storage Capacity
  • Ontario IESO Procurement Phase 1—July 2014
  • Ontario IESO Procurement Phase 2—November 2015
  • ESGAS Power Capacity by Technology and Year Commissioned: 2010-1Q 2016
  • ESGAS Power Capacity by Region and Year Commissioned, World Markets: 2010-1Q 2016
  • Overview of ESGAS Applications
  • Total Annual Installed Power Capacity of Variable Generation Resources by Region, World Markets: 2016-2025
  • Annual Utility-Scale Wind Installed Power Capacity by Region, World Markets: 2016-2025
  • Annual Utility-Scale Solar PV Installed Power Capacity by Region, World Markets: 2016-2025
  • Advanced Battery Performance Comparison
  • Energy Storage Value Chain Comparison, Select Leading Companies
  • ESGAS CAPEX Assumptions by Technology and Application, Average Installed Costs, World Markets: 2016-2025
  • Installed ESGAS Power Capacity by Region, World Markets: 2016-2025
  • Installed ESGAS Power Capacity by Technology, World Markets: 2016-2025
  • Installed ESGAS Power Capacity by Application, World Markets: 2016-2025
  • Installed ESGAS Energy Capacity by Region, World Markets: 2016-2025
  • Installed ESGAS Energy Capacity by Technology, World Markets: 2016-2025
  • Installed ESGAS Energy Capacity by Application, World Markets: 2016-2025
  • Installed ESGAS Revenue by Region, World Markets: 2016-2025
  • Installed ESGAS Revenue by Technology, World Markets: 2016-2025
  • Installed ESGAS Revenue by Application, World Markets: 2016-2025
  • Installed ESGAS Power Capacity by Technology and Application, North America: 2016-2025
  • Installed ESGAS Power Capacity by Technology and Application, Western Europe: 2016-2025
  • Installed ESGAS Power Capacity by Technology and Application, Eastern Europe: 2016-2025
  • Installed ESGAS Power Capacity by Technology and Application, Asia Pacific: 2016-2025
  • Installed ESGAS Power Capacity by Technology and Application, Latin America: 2016-2025
  • Installed ESGAS Power Capacity by Technology and Application, Middle East: 2016-2025
  • Installed ESGAS Power Capacity by Technology and Application, Africa: 2016-2025
  • Installed ESGAS Energy Capacity by Technology and Application, North America: 2016-2025
  • Installed ESGAS Energy Capacity by Technology and Application, Western Europe: 2016-2025
  • Installed ESGAS Energy Capacity by Technology and Application, Eastern Europe: 2016-2025
  • Installed ESGAS Energy Capacity by Technology and Application, Asia Pacific: 2016-2025
  • Installed ESGAS Energy Capacity by Technology and Application, Latin America: 2016-2025
  • Installed ESGAS Energy Capacity by Technology and Application, Middle East: 2016-2025
  • Installed ESGAS Energy Capacity by Technology and Application, Africa: 2016-2025
  • Installed ESGAS Revenue by Technology and Application, North America: 2016-2025
  • Installed ESGAS Revenue by Technology and Application, Western Europe: 2016-2025
  • Installed ESGAS Revenue by Technology and Application, Eastern Europe: 2016-2025
  • Installed ESGAS Revenue by Technology and Application, Asia Pacific: 2016-2025
  • Installed ESGAS Revenue by Technology and Application, Latin America: 2016-2025
  • Installed ESGAS Revenue by Technology and Application, Middle East: 2016-2025
  • Installed ESGAS Revenue by Technology and Application, Africa: 2016-2025
  • ESGAS Application Details
  • 2014 vs. 2016 ESGAS Applications
  • California AB 2514 Procurement Targets: 2014-2020
  • SCE 2014 Request for Offer Contracts, Energy Storage Resources
  • PG&E 2014 Request for Offer Contracts, Energy Storage Resources

{"userID":"","pageName":"Energy Storage for the Grid and Ancillary Services","path":"\/research\/energy-storage-for-the-grid-and-ancillary-services","date":"11\/18\/2017"}