Energy storage systems using lithium-ion batteries are 30% cheaper over their lifetime compared with fossil fuel powered peaker plants, according to a report from Australia.
Large-scale battery storage has cost, flexibility, grid-scale services and emissions benefits over traditional electricity peaking services, says not-for-profit, membership-based organisation Clean Energy Council (CEC).
CEC’s ‘Battery Storage – The New, Clean Peaker’ report compared a new 250MW gas peaker with a 250MW four-hour grid-scale battery.
The report says the levelised cost of energy (LCoE) for two-hour batteries is A$195/MWh ($151/MWh), four-hour batteries are A$156/MWh ($121/MWh) and the cost rises to A$234/MWh ($182/MWh) for a gas peaker.
CEC calculated its LCoE by looking at three areas: capital cost, fixed operations and maintenance, and variable operations and maintenance.
The organisation’s chief executive, Kane Thornton, said: "Large-scale batteries are now undoubtedly the best option to meet periods of high electricity demand.
"Electricity demand must match supply at all times, and so on very hot days when demand spikes we quickly need more supply to respond.
“Sometimes, it's only for a few seconds; other times, it's for a couple of hours. In this respect, the capability of large-scale batteries is unrivalled. Over the past three years, batteries have been essential in keeping the grid stable and keeping power flowing to energy users."
The Australian Energy Market Operator anticipates that between 6GW and 19GW of new, dispatchable resources will be needed across the National Electricity Market by 2040.
Since 2018, 8.9GW of large-scale battery storage has been financially committed, proposed and/or approved in Australia— this includes 15 large-scale battery storage projects announced this year, representing 6.6GW of capacity and A$4.3 billion ($3.3 billion) in investment.
Thornton said: “Long-term investment certainty remains reliant on appropriate market reforms and forward-looking policies that incentivise new, flexible technologies that are needed to complement renewables."