Big Batteries Are Becoming Much Cheaper


Batteries are hot right now. Energy storage was referred to as the Holy Grail of renewables by one industry executive, as it would solve its main problem: intermittency. No wonder then that everyone is working hard on storage.

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They are working so hard, it seems, that prices, which used to be a major obstacle along the path toward renewable energy storage gaining ground, have fallen much lower than the price of traditionally generated and stored energy, the Wall Street Journal notes in a recent story on giant batteries.

One Minnesota utility, Xcel Energy, not long ago, carried out a tender for the construction of a solar + storage installation, receiving 87 bids whose average price per megawatt hour was just US$36. This compares with US$87 for electricity generated by peakers, with the price including the cost of construction and fuel purchases for the plant.

But peakers are not regular power plants. They only work for a few hours a day when demand is at its highest, and this makes them less cost-efficient than regular power plants. Yet the fact that big batteries are beginning to make the construction of new peakers uneconomical could be a sign of what is to come: more and cheaper installations that use renewable energy to power tens of thousands of households.

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