A123 Systems plugs lithium-ion batteries into power grid

A123 Systems has signed on electricity utilities to use its lithium-ion batteries for short-term energy storage, according to a company executive.

The company, spun out of the Massachusetts Institute of Technology, is a closely watched venture that is best known for activity in the auto and power tools markets.

It is working with General Motors for plug-in hybrids and Think for all-electric town cars. A123 Systems also owns Hymotion, a company that converts hybrid cars to plug-in hybrids.

But lithium-ion batteries, already used in millions of consumer electronics devices, can be plugged into the electricity grid as well, according to the company.

A123 Systems is working with investor General Electric to use A123 batteries for "grid stabilization," said Ric Fulop, founder and vice president of business development, on Tuesday. He spoke on a panel of energy storage experts organized by the New England Clean Energy Council.

Utilities need power for short periods of time--it could be as short as several seconds--to ensure that the power supply matches the demand. It's a multimillion dollar market, Fulop said.

"(Our batteries) take our batteries and make the grid a hybrid similar to what we do in a car," Fulop said.

He declined to provide more details on how their batteries are being deployed or how many except to say they are already in use. A company spokesperson was not available to further comment on A123 Systems' work with utilities.

Right now, there are not many storage devices used on the U.S. power grid. But interest in energy storage is growing as utilities look for alternatives to building new power plants to meet peak demand. They are also seeking ways to incorporate solar and wind power onto the grid, though they are intermittent sources of energy.

Fulop said that batteries can meet utility needs for grid stabilization, where a large amount of electricity is needed for a short amount of time.

"The technology can do it. Now it's a question of building the systems," he said. "Megawatt-level systems are all about systems integration."

In addition to batteries, utility-ready energy storage systems require electronics and thermal management systems, he said.

Fulop noted there are a number of challenges to getting new storage technology used by utilities.

Financing large projects is difficult, and utilities are hesitant to work with a technology that does not have a 15-year track record. As a result, he said that venture-backed start-ups are more or less closed out of the market, which is why A123 Systems is partnering with GE.

Still, he predicted that some early adopters of battery storage will yield positive results over the next three to five years. Other alternative to batteries for short-term storage and stabilizing the grid's frequency are flywheels or different types of batteries.

"I think we will see a lot of deployments in the next few years that will change how the grid works," he predicted. "Then we'll see utilities jump on the bandwagon."

[theBike45]

The problem with batteries on th egrid is that they simply cost too much to do anything even remotely close to storing wind power - that would be absurd. They can only handle short irregularities of supply and demand. These batteries cost $1,000 per kilowatthour, or a
million dollars per megawatthour, and a megawatthour is not all that much power - a windmill could produce that in a couple of hours.

[Maccess]

Grid stabilization? Go make hydrogen during short term peaks. Higher Peak = More hydrogen. No excess = no problem.

[Hoser McMoose]

I agree with theBike45 on this one. I don't think the costs are quite that bad anymore (I think they're down to $600-$800/kWh these days), but they're still prohibitive.

This is one of the real challenges of the electrical grid, and one that is far too often overlooked in many plans for how to 'fix' the grid. Minimum electricity consumption is often as little as 50% of peak electricity consumption in one day! Since it's difficult and expensive to store this excess energy you need a mix of supplies that can be ramped up or down quickly to adjust to demand. Unfortunately wind power fails miserably in this regard. Nukes are better, but not by much. Dam based hydro power is your best bet, but limited by geography.

[sharpestsharpy]

No energy storage system will be 100% efficient and this makes them unattractive.
The first question is can it be cheaper to store the excess than build the extra capacity to meet the peak? The next question is how much capacity do you build? To make a meaningful contribution you would need upwards of 10% of peak demand and that sounds like many thousands of flywheels spinning or a massive investment in pump-storage plants.

[rdupuy11]

cell companies know when they have peak demand, and rather than build out more capacity, they charge more for peak demand.

[carlhage]

If the cost comes down to around $300/kWh (and >10 year life) then batteries become cost-effective for load leveling. Peaking power can be expensive to run and typically get only 50% efficiency from the fuel. Generating hydrogen for fuel cells loses around half the energy, and is more expensive than a battery. Note PG&E already uses old recycled Prius batteries-- not good enough for a car, but works fine in a building.