As a historian by training I’m wary of making predictions about the future. But I am also working for a company that deals in ‘rapid innovation,’ so I think it’s important to ponder on emerging technologies and explore their possible future developments.
At university, certain supervisors inculcated that generalist, big picture history with predictions of the future should be avoided. It was dismissed by some stuffy types as “populist drool.”
In the world of business, however, an inference into the future is often labelled as vision.
Only 6 months into my career. I’m not going to declare myself a visionary quite yet. Nor am I going to use this blog space to make predictions about the future, which time will inevitably prove wrong. However, this blog will explore some ideas around developments in battery technology and how I believe it will significantly shape how we generate, consume and trade energy.
Most mobiles, laptops and cars are powered by lithium-ion batteries which were initially developed by Sony in the 1990s. While they have steadily improved since then, the pace of technological improvement in batteries has been relatively slow; just think of your latest smart phone dying at the most inopportune moments. A number of technological developments are under way with fuel cells, flow batteries, lithium air and lithium sulphur promising improvements in the efficacy of batteries. None, though are ready at commercial stage as cost is still a major barrier to scalability for these new technologies. Cost has also been one of the inhibiting factors behind the lack of technological development and user-adoption of lithium-ion batteries for energy storage.
Despite these barriers there is currently a lot of hype around battery technology and this is reflected in significant price hike of lithium carbonate in a current bear market for commodities [See Figure 1]. This excitement around developments in battery technology is not just driven by Prius drivers hoping to get a few extra hundred miles out of their car; battery technology will have a major effect on changing relationships in the space of electricity generation, distribution and consumption.
Figure 1 *
Batteries and the energy landscape
Electricity generation has changed significantly in the last 20 years. Even now, despite the seemingly ever-declining price of oil, renewable energy continues to grow worldwide. In 2015, solar and wind capacity added 121 gigawatts, while investment in renewable technology reached $329 billion.
Yet, renewable energy is far from being the dominant source in our energy mix and in the UK it accounts for 15% of energy generation. Indeed, one of the most common gripes with renewables is that its supply of energy does not correlate with demand. When it’s cold and dark outside there is little chance your solar panels are going to work and you can’t always be sure there will be gusts of wind when electricity is needed. While the growth in wind and solar technologies has been impressive, the future development of renewables lies in the ability to mitigate these intermittencies by combining with power storage.
Batteries can plug the gap between energy supply and demand.
At the domestic level, one of the most talked about developments in power storage has been Tesla’s announcement of the Powerwall. This technology will enable traditional energy consumers to store energy from the grid and/or store energy they create from renewable sources. Though I opened by talking about developments in lithium-ion technology, what is most interesting about the Powerwall is not the storage ability itself, but the technology’s connectivity to the grid and the implications of this. The Powerwall, for example, can smartly decide to store energy when electricity demand is low and its price cheap, and discharge this stored energy when electricity demand is higher and therefore more expensive.
This increased connectivity opens up channels of communication and data at the point of generation, supply and consumption. This ability will play a key role in connecting us to promised smarter grids. Batteries will extend the prosumer model, further blurring the traditional defined roles in the energy landscape. Previous consumers of energy will increasingly play the added roles of producer and broker of energy, while new channels of communication between consumers and utilities will become ever-more significant. Not only will electricity flow both ways down these channels, but data will become a key commodity to the highest bidder.
Battery technology has already seriously impacted on modern society. Batteries power our phones, tablets, laptops and are an essential technology in the automotive industry—both now with electric cars and with lead-acid car batteries. As batteries become more reliable and their energy density improves (ability to store more energy without getting physically larger), they should become an integral component of smart grids. Power storage technology has not sparked a whole new energy eco-system. Rather its domestic and commercial adoption will accelerate our transition to smarter grids and further distort current roles and relationships on the energy stage.
* Source for Figure 1: http://www.economist.com/news/business/21688386-amid-surge-demand-rechargeable-batteries-companies-are-scrambling-supplies