Cheaper Batteries Mean Big Opportunity

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Energy storage as a whole is a huge market opportunity. (Image: Terrament)

Terrament is building affordable, large scale energy storage. This week Eric Chaves, the Founder of Terrament, talked about his solution for energy storage — Modular Underground Gravity Storage (MUGS). He believes that Terrament can provide a cheap, scalable solution for grid-scale long duration energy storage.

Below are the key takeaways from the conversation, and if you want to dig deeper, check out Eric’s research paper.

Why does this matter?

  • Today, inefficient peaker plants are used as backup electricity supply. This problem can be solved by storing excess energy and then releasing it into the grid during peak demand.
  • Today, only 2% of energy on the grid comes from storage. Of that, 94% comes from pumped hydro storage. Chemical batteries on the other hand, are less than 5% of the market, and only about 0.1% of the grid’s power can be stored in chemical batteries today.
  • Pumped Hydro is the cheapest form of energy storage, but we’ve already exhausted most of our pumped hydro resources. So we need affordable alternatives.
  • Terrament’s design was directly inspired by underground pumped hydro storage (UPHS), and it leverages the body of research which has already validated that UPHS is both technically and economically feasible.
  • BloombergNEF projects exponential world-wide growth of stationary energy storage from 9GW deployed as of 2018 to 1,095GW by 2040.
  • Terrament would be able store about 180MW, which is about 2GWh of power. This is about the same size as hydro plants, which is enough to support an entire large city’s energy storage needs.
  • Terrament’s design has a lower ecological footprint than traditional pumped hydro storage.
  • Over the next 40 years, gravity storage like UPHS and MUGS technology is estimated to be cheaper than Li-ion batteries, even under the most optimistic circumstances for Li-ion technological advancements.

What’s next?

  • The whole energy industry knows that this is coming. There are graphs out there which show accelerated growth projection for energy storage. The catch is that these graphs are usually only addressing lithium ion battery storage — leaving out long duration.
  • The demand is so huge that it’s being called a trillion-dollar holy grail. The power industry understands the need for cheap energy storage and they’re scrambling to figure out how to build it. Governments and Investors are also hungry for these solutions.
  • Interest rates are low and are set to stay low. This is important because with the long construction times, it makes a huge impact on the price of installation.
  • This technology is low risk because Terrament is taking to areas that are extremely known quantities, mining/digging and large industrial machinery commonly used in wind turbines. .
  • Building a Terrament installation today would be more feasible than ever due to low interest rates, improved mining technology, and an accelerating demand for large-scale energy storage driven by climate change.
  • Over a 20–40 year project lifespan, Terrament could be an order of magnitude cheaper than Li-ion battery technology built today.

Thoughts

Energy storage will be one of the challenges the sector will face as we continue to electrify everything. As electricity demand is only projected to grow, there will be a need to manage energy from a demand response and resource allocation perspective. Terrament offers a unique and feasible solution to help in this transition.

This story has been featured in The Impact, an email newsletter that covers the latest news in the renewables and cleantech space. Check it out and subscribe here.

Written by

Impact Investment Analyst at One World | Startup Weekend Facilitator | Climate Tech Enthusiast

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