Recently Central Government’s Department of Heavy Industry issued a notification of Rs 18,100 cr PLI (Production Linked Incentive) scheme for promoting manufacturing of ACC (Advanced Chemistry Cell) batteries. National Programme on Advanced Chemistry Cell (ACC) Battery Storage
has been introduced for implementation of giga-scale ACC manufacturing facilities in India. Advanced Chemistry Cells are the new generation advance energy storage
technologies that can store electric energy either as electrochemical or as chemical energy and convert it back to electric energy as and when required.
The Indian Energy Storage Market is expected to rise at a CAGR of approximately 10% during the forecast period of 2021-2026. Increasing energy demand in the country is expected to drive the Indian battery energy storage system market during the period. “There are factors such as fulfilling electricity requirement in the country during the peak hours of the day which is likely going to drive the Energy Storage market in India,” says Ganesh Srinivasan, CEO of Tata Power DDL.
Indian government is making concerted efforts to develop energy storage technologies to manage variable generation from renewable energy sources, including solar power. However, the intermittent nature of renewables poses several problems for utilities, namely in terms of load balance, grid stability and security. There are some solutions which have been put forward to remedy this, such as using demand-side management and strengthening grid infrastructure. The choice of technology mainly depends on cost and how it is being applied to grid, i.e., whether it’s for load management, power quality or backup services.
There are many technologies being used for energy storage, out of which battery technology is the latest one. The usage of battery varies depending on whether it’s for residential, industrial or commercial purposes. For residential purposes, the batteries are used as backup to address power outages and mostly have a capacity of less than 5KW. For example, there are Lead acid batteries which are most widely used, often seen in rooftop solar installations and are rechargeable kinds.
There is one more kind of battery technology mostly used in laptops and cell phones, known as Lithium-Ion. With the increasing demand of electric vehicles, there is an even greater demand for Lithium-Ion batteries now. These batteries offer lightweight design and high energy density. A typical Lithium-Ion battery can store 150 watt-hours of electricity in 1 Kg of battery.
Although, Lithium-Ion is expensive and can degrade quickly, the capacity of Lithium-Ion battery is six times higher than a typical lead acid battery, which can store only 25 watt-hours per Kg. Along with these technologies, there are new battery technologies entering the market. Some of them are nickel-cadmium, sodium-sulphur, flow batteries like vanadium redox and zinc bromine. Although their current commercial scale applications are limited now.
Grid Scale Energy Storage Technology
The choice of energy storage technology depends on certain factors such as cost and how it’s being applied to the grid. According to Navigant Consulting, the global market for grid scale energy storage is expected to grow from the $675 million annually that it was in 2014 to $15.6 billion annually by 2024. The dominant energy storage technology for grid application is pumped hydro. In India, there are about 2.6 GW of pumped hydro plants which are already in operation while proposals for another 8.9 GW are still awaiting approval.
Hydrogen Energy Storage Technology
Nowadays, one more technology undergoing a lot of research and development is Hydrogen Energy Storage with fuel cell technology. The world’s first utility scale test of a standalone renewable energy system integrated with hydrogen storage is taking place in Norway. Also, there are several demonstration projects taking place in Netherlands, Spain and France. There are many uses of this technology but one of its main use is in Fuel Cell Electric Vehicles (FCEVs), which store hydrogen in a pressurized tank to serve as fuel. This technology can be used in cars to reduce peak demand during acceleration and optimize overall efficiency of the vehicle, by storing braking energy in the battery.
Challenges in Energy Storage
Government schemes such as FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) phase 1 and 2 has helped to create an emerging market for energy storage solutions, but more policy interventions are required to unlock demand across all applications. India has no major producers of EV (electric vehicle) batteries at present and it lacks state of the art facilities for both sufficient capacity and capability. The absence of a regulatory framework for energy storage system is impeding the development of the energy storage sector.
Another area of concern in respect of energy storage in India is the need for provision of cost competitive energy storage technologies. According to CERC (Central Electricity Regulatory Commission), reduction in costs needs extensive engineering research and development for new storage concepts and the requisite materials. Also, grey areas such as risk mitigation, controlling uncertainties at the early deployment stage and operational uncertainties also need in depth analysis for an informed grasping of energy storage criteria.
There are no proper reserves in India of some of the most critical Lithium ion components such as lithium, cobalt and nickel. Also there are no reserves of copper that is used in conductors, cables and bus bars. Also, determination of the appropriate commission is another challenge. A feasible solution would be to use the ownership structure as a basis for selection. The cost recovery mechanisms vary, depending on the ownership structure and the purpose for which storage assets are used.
Future of Energy Storage Market in India
The Energy Storage market is set to grow significantly, with the development in technology and renewables becoming more common. With the cost of decreasing storage technologies, adoption will happen at a much faster rate. Also, the rising trend of new innovative business models which are designed to offer energy as a service and new applications such as repurposed Electric Vehicle batteries, they all signal towards huge change in the energy market of the future.