For the world to become climate neutral by the coming 30-40 years, enormous amounts of renewable energy will be deployed. The transition has already started. As a result, large daily swings of energy generation occur in our system, and in some markets, we see negative electricity prices. To balance these swings into a stable energy generation, energy storage is crucial. In other words, the storage market has barely taken off.
Rikard Tullberg, the CFO of Pumped Hydro Storage, discusses how he envisions the future of energy storage.
Can you describe what Pumped Hydro Storage is working on and the impact?
Pumped Hydro Storage (PHS) is a developer of large-scale energy storage projects. We are here to propel the transition into a carbon-free planet by providing one of the world’s most sustainable and cost-effective energy storage solutions.
By benefitting from the decades-long development of pumped storage technology and utilizing it in underground mines, PHS creates a state-of-the-art storage solution without the need for any rare earth metals. By replacing gas peaker-plants, our large-scale projects can reduce their emissions by up to 200 thousand tons of CO2 per year.
PHS incorporates the whole value chain in the delivery of a successful energy storage project, including project development, permitting, construction, realization, and operation. As such, we own the project and optimize it through all phases until we pass it over to an investor at the start of operation.
How does the ecosystem/partners/customer seek to benefit from your technology?
As energy systems will be more reliant on intermittent weather-dependent renewable energy, the energy off-takers and grid owners who warrant a stable energy generation to their customers need to find a solution to secure a stable energy output. As such, the demand for a cost-effective long-duration (4-12 hours) energy storage will heavily increase to meet the coming need to balance the ongoing rush of deployment of renewables into the system. And this is where PHS’ solution comes in.
The land/mine owners get a second life of their mine, transforming it from a depreciated asset/liability into a valuable asset again. Meanwhile, project owners/investors will gain a financial yield of 5-10%, in parity with other large-scale renewable energy projects, such as wind and solar projects.
What are the current trends in the sector? What does the future look like?
The renewable energy transition has already begun, but we have only seen the start of it. According to sector experts, renewable energy penetration will increase exponentially during the coming 30 years.
As such, lots of different technologies are under development to cater to the huge demand for energy storage that is to come. However, many of the technologies usually come with an obstacle – either they depend on rare earth metals, have a low-efficiency rate, or are very expensive. They can also use a less environmentally friendly technology or be in an early stage of technical maturity. When storing energy through pumped storage, we use something as natural as regular water as the energy carrier and generate energy by utilizing gravitational forces between two reservoirs at different heights.
Hydropower and pump technology are both two very mature technologies, benefitting from decades-long development. The oldest pumped hydro facility that is still active was developed in 1907. However, as the demand for long-duration energy storage hasn’t been as urgent until recent years, the deployment of the technology has been limited in the western world in the last decades. Thus, PHS’ initiative to combine the technology and deploy it in underground mines could be called a “renaissance” of a mature technology, by commercializing it in a new market environment.
Outlook
The market for energy storage will be enormous – there will be many solutions that will cover the entire demand for renewable energy. I believe that scaling existing technologies, such as hydropower, is the path forward to a sustainable future. The trick is finding the right capital to support these projects and efforts.
About The Author
Daniel currently works at Lawrence Livermore National Laboratory. His original assignment was to maintain and update facility safety documentation for all facilities on-site, and perform risk analysis. Over time, his role has expanded to leading continuous improvement efforts through product management.
Concurrently, Daniel volunteers with Techstars, helping organize startup weekends, and with the American Institute of Chemical Engineers, organizing events on the local and national levels of the organization. He also volunteers with One World, and previously with Powerhouse Ventures, to source and screen startups for potential investment.
Daniel holds a BS in Chemical Engineering from UC Davis, and recently completed coursework in energy innovation from Stanford. His passion is at the intersection of sustainability, innovation, and business.