Battery Storage Is Becoming a More Viable Replacement for Gas Peakers

Peaker plants are power plants that are used during times when energy demand is high. These plants usually run on natural gas and can be used for a few or several hours at a time, depending on the state of the grid. However, excessive pollution from peaker plants results from fast ramp times and single-cycle operation. On the other hand, emerging and cleaner energy storage technologies have been used to alleviate stress from the grid during peak energy demand times. Systems that couple renewable energy with storage are especially attractive for a clean energy transition and are critical to prioritizing equitable access to clean air and energy. As storage technology advances, more diverse and long-duration battery solutions have become available. 

Long-Duration Energy Storage Options Filling Historical Technology Gap

Lithium ion (Li-ion) technology is the leading option for many different storage applications because of its low relative cost and increased performance. Although Li-ion batteries are the leading energy storage technology, they are often best used for a maximum of 4 hours. Li-ion batteries also have a high marginal cost, making them less competitive at longer durations. Stakeholders are increasingly making the case for gas peaker replacement to adopt cleaner technologies such as advanced batteries. Still, much of the energy demand for gas peakers exceeds 4-hour duration periods, and not many battery technologies were able to fill this gap until recently. Increasing durations by just a few hours would be able to meet an increased energy demand. As average durations continue to extend into the 6-plus hour range, a larger portion of the gas peaker demand can be met. 

Other technologies, such as flow batteries and compressed air energy storage technology, have begun to make an impact on energy storage markets due to their long-duration capabilities, flexibility, and large-capacity systems. As demand for long-duration storage intensifies and confidence in emerging storage technologies increases, energy markets may experience these high capacity technologies that can fulfill energy demands once only met by fossil fuels making up more of the storage market share.

Will the Energy Industry Transition Out of Gas Peakers?

As renewables gradually displace fossil fuel generation, the need for technologies that can economically provide a full suite of grid services is anticipated to increase. In the US, the age of gas-powered plants averaged around 22 years in 2016. As the majority of fossil fuel plants come into their retirement age (30-50 years), there will be increasing opportunities in the next decade for new technologies to replace gas peaker plants. Replacing most or all of a system’s fossil fuel baseload and peaking power plants with renewable energy requires pairing these resources with long-duration, large-scale energy storage that can replicate the services and reliability provided by traditional power.