Grid Energy Storage Investing

Brian Hicks

Written By Brian Hicks

Posted June 5, 2013

A123 Energy Solutions has stated that it will develop a Long Duration (LD) Grid Storage Solution in Hawaii for the Maui Electric Company. The battery installation will provide up to 1 megawatt per hour. It is hoped that this solution will go far in helping the Maui power grid attain greater stability.

batteryThe batteries, once installed, can store power for up to one hour, while the system can regulate grid voltage, appropriately shift power loads, and also store excess power generated by wind turbines, reports Bloomberg.

This isn’t the first time A123 has helped out in Maui. Back in December, the company installed another battery system. This one had a capacity of 11 megawatts and could store power for 25 minutes.

BizJournals quotes:

“This installation is the second site we’ve commissioned on the island of Maui in the past five months,” A123 Energy Solutions President Bud Collins said in a statement. “But while the 11-megawatt commissioned in December of last year was comprised of our widely deployed High Rate systems, this is the first time we’ve commissioned the Long Duration product. We’re very happy with how smoothly the installation went. The entire process took about five weeks from start of construction up to the completion of commissioning.”

The new battery system features the Long Duration Grid Battery System, which is remarkable scalable; energy storage configurations can vary between 100kW to multi-megawatt arrays. More importantly, the system can be conveniently packaged to suit numerous enclosure types (20-foot, 40-foot, 53-foot, or custom enclosures).

The system, reports the Wall Street Journal, relies on A123’s Nanophosphate® prismatic cell technology, which enables just one 53-foot system to deliver 4 megawatts for an hour.

A123 Energy Solutions, once known as A123 Systems LLC, works on developing advanced batteries for electrical grids, backup solutions, and lead-acid replacement options relying on the Nanophosphate® technology. The company is part of China’s Wanxiang Group, which acquired its assets back in December after A123 Systems originally filed for bankruptcy. The Wanxiang deal was estimated to be worth $256.6 million, according to BizJournals.

China Goes Green?

It’s worth paying attention to China’s green strategy. Over here in the U.S., ideological problems make progress difficult for green solutions. Granted, we’re in a tough economy. However, when fledgling industries are asked to compete against long-entrenched ones commanding significant economies of scale, it makes sense that the newer industries be supported in the early phase by government investment. That, of course, rubs some the wrong way.

China has no such qualms and has regularly invested generously in green energy solutions. In fact, the nation’s invested in energy, period. Witness its billions poured into the Canadian oil sands, into American shale plays such as the Eagle Ford, and so on. More recently, China invested massively in Venezuela, clearly hoping that Venezuela will salvage and develop its indigenous oil sector, thus leading to future returns on China’s investment in the form of oil.

So why is China bent on buying up energy in massive quantities? Well, the IEA estimated last year that China currently accounts for the biggest proportion of demand growth for energy on a worldwide basis. That’ll go up by nearly 60 percent by 2035.

That means they need to keep buying up energy to fuel the nation’s exploding urbanization and development. And that means A123 certainly won’t be the last investment, green or otherwise, that China will be making.

But this presents an interesting picture. Here in the U.S., green companies (especially most startups) have to compete against an unfriendly ideological scenario (in addition to, you know, proving their efficiency). But what could A123 do under China’s aegis? For that matter, ought more green companies—especially the newer ones—look East-ward for a more nurturing environment in which to develop? Could China (of all places) become a major player in green energy?

I can’t say, but it would certainly help them a great deal given how major a problem domestic pollution has become over there.

In the U.S., for the foreseeable future, green companies will have a tough time because everyone is obsessed with shale energy. And why not? Shale has proven a valuable goldmine and has contributed to skyrocketing oil and gas production. It’s hard to compete against that right now. 

 

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