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Will Peaker Plants Be Replaced By Grid Energy Storage

The Energy Storage Revolution

Most people take it for granted that when they flip a light switch or plug in their phone charger, the electricity will be there. Thanks to the nation’s power grid, it almost always is. Large power stations around the country supply enough power to meet the minimum demand of homes and business without interruption. This basic level of demand is called the base load. But what happens when demand increases when temperatures soar and everyone in the state turns on their air conditioner at the same time? That extra power needs to come from somewhere. Historically, peaker plants have provided the necessary extra power during times of peak energy usage. In recent years, however, newer utility energy storage technologies are set to take center stage and fill the need for grid energy storage. This is where energy storage companies come into play.

What Are Peaker Plants

When energy demands rise, the extra power is usually supplied by peaker plants, also called peaking power plants. They’re called this because they only operate during times of peak demand for electricity. How often a peaker plant runs depends on regional demand. In some places, peaker plants are needed every day, while in other places they may only operate for part of the year. Peaker plants also play an important role in locations that are moving toward renewable energy sources. Because the sun sets and the wind dies down, solar and wind plants don’t generate power consistently. When these energy sources are producing less power than required by the local population, peaker plants fill in the gaps. Peaker plants are almost always fueled by natural gas, largely because they can be turned on and off quickly. This allows them to ramp up and ramp down power output based on fluctuating demand.

Unfortunately, a typical simple cycle gas-powered peaker plant isn’t very efficient, which means the electricity it produces costs more per watt than base load plants. Producing expensive power allows peaker plants to be profitable even when they only operate intermittently, but it also means consumers pay more for power during peak demand. Some peaker plants are combined cycle plants. This design improves efficiency by using hot waste gases to generate more electricity, but unfortunately, combined cycle plants are more expensive to build and operate. In addition, they may be more efficient than simple cycle plants, but they’re still only about as efficient as older coal-powered plants. Regardless of which type of natural gas peaker plant is being built, the permitting process to build a new one can take seven to ten years, making it difficult to meet rising demand in a timely manner.

Low efficiency, high cost, and the long time from conception to completion is one issue. That combined with a growing concern about carbon emissions from the burning of fossil fuels, like natural gas, has caused the energy industry to look for better ways to meet high energy demand. America’s power demands continue to rise and as existing peaker plants age they will need to be replaced with new plants or alternative technologies. Fortunately, innovations in utility energy storage in recent years have introduced a cleaner, more affordable answer, and the energy storage companies are eager to develop new technologies, such as grid energy storage to help replace the peaker plants.

How Does Utility Energy Storage Work

Rather than producing extra energy during peak demand, grid energy storage relies on stored energy to meet increased demand. A large grid-scale battery installation can absorb energy from any type of base plant, from coal to solar, and store it. When demand exceeds base power output, the batteries discharge, releasing energy into the grid. When demand for power falls again, the batteries recharge by absorbing extra energy produced by base plants. Batteries may be one of the newest and most promising stored energy technologies, but they aren’t the only one. Pumped hydroelectric, compressed air, and flywheel energy storage are all grid energy storage technologies currently in use. Energy storage companies are working to develop new technologies, such as hydrogen and adiabatic energy storage.

Why Grid Energy Storage is a Better Option

For a long time grid-scale batteries were considered a future technology, but in recent years, the future has arrived. New innovations have lowered the cost of battery production and made them a competitive alternative to peaker plants. Batteries can also be deployed anywhere, unlike other storage technologies, such as hydroelectric, which requires a large river. This type of energy storage is also more responsive, cleaner and faster to implement than gas-powered peaker plants. There’s no need to ramp up or ramp down a battery because no energy-generating equipment is involved. This means that stored energy can be deployed almost instantly, unlike energy from a gas-powered peaker plant.

The improved flexibility and responsiveness of utility energy storage make power grids more robust when it comes to meeting consumer demand. Stored energy is also cleaner technology and battery installations produce zero emissions. In contrast, gas-powered peaker plants are often dirtier than base load plants. Energy storage options are also ideally suited for use with cleaner, renewable energy plants like solar and wind. While the sun and wind are strongest, the excess energy can be stored. Then, when the sun sets and the wind dies down it can be released into the grid. Even when base plants are powered by fossil fuels, they’re still more fuel efficient than gas-powered peaker plants. This makes energy storage a cleaner option in almost every case.

Win-Win for Utilities and Energy Storage Companies

Installing battery facilities is also a lot faster and easier than building a new gas-powered plant. After a natural gas storage facility in California ruptured, creating the biggest natural gas leak in U.S. history, San Diego Gas and Electric turned to energy storage to meet demand. AES Energy Storage built the Escondido energy storage facility in just 6 months using their grid-scale lithium-ion batteries. This is a far cry from the seven to ten year process necessary for a new plant. The success of this project and others like it has paved the way for more energy storage companies to propose projects around the country.

The shift away from dirty, expensive, gas-powered peaker plants has already begun. As plants continue to age, they can be replaced by cleaner energy storage options around the country. Cleaner, more-efficient, responsive and quick to install, utility energy storage allows energy providers to adapt and expand to meet the country’s growing energy needs.