Projects like SK Innovation & Ford’s Blue Oval City will substantially grow the US’s domestic li-ion manufacturing capacity. Image: Ford.

Nearly 4.2GW of battery storage capacity was added to the US grid in 2021, according to a new report from BloombergNEF which also looked at growth in the country’s lithium-ion manufacturing capacity.

The ‘Sustainable Energy in America Factbook’, produced for The Business Council for Sustainable Energy, says the figure is more than in all preceding years combined.

Non-hydro, i.e. battery energy storage deployments, grew 360% to 4,417MW although it says that only 77% of this is ‘confirmed’ with the remainder ‘estimated’. It brings the US’ cumulative total battery storage deployment to 6.6GW. The report highlights two main drivers of growth.

First, there is a growing need for storage in energy-shifting applications due to rising renewables on the grid, particularly California’s. And on the regulatory side, the Federal Energy Regulatory Commission (FERC) Order 841 (2018) removed barriers preventing storage from fully participating in those markets, providing a further tailwind to the sector.

Though it cautions that with the higher penetration rate of batteries comes increased pressure to deliver on meaningful system-level impacts on the grid and power markets. Pumped hydro is around 80% of storage capacity in the US today but has been close to flat since 2004, today sitting at around 22.5GW.

BloombergNEF’s report covers all segments of the battery storage market including residential, which saw 19,607 installations in the first nine months of 2021, two-thirds and 1.5x higher than the same period in 2020 and 2019 respectively.

US lithium-ion battery manufacturing capacity also increased, growing to 60GWh/year in 2021. It is expected to reach almost 100GWh/year by the end of 2022, though BloombergNEF does not forecast any further ahead.

However, it notes that joint-venture projects by SK Innovation/Ford’s Blue Oval City and Samsung SDI/LG Energy Solution will add 129GWH by 2027 and 40GWh by 2025/25, respectively. These nearly triple the manufacturing capacity figure on their own.

BloombergNEF’s reports’ broader brief and methodology makes for more positive reading than the American Clean Power Association’s (ACP) recent report, which only covered utility-scale deployments and said that clean power installations fell 3% last year to 27.7GW after a particularly poor last quarter.

BloombergNEF says that overall, new renewable energy capacity deployments grew 5% to 37.3GW in 2021. This figure doesn’t include storage, without which the ACP’s annual deployments figure would have been even lower.

The battery storage sector employed 67,000 people at the end of 2020, though this is likely to be much higher considering the deployment levels the following year. Around 10% of its workforce is unionised, in line with solar and wind.

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Even Tesla needed to put its EV operations’ demands ahead of its own BESS business last year. Image: SRP.

Energy storage system integrators are diversifying their procurement strategies to ease supply chain constraints, with the electric vehicle (EV) market a bigger priority for battery cell and module suppliers.

Integrators are starting to procure or consider using Tier 2 battery makers’ products, as investors become “comfortable with the level of risk involved in this market,” Oliver Forsyth, analyst for IHS Markit, told Energy-Storage.news. 

“If you subtract the amount that will go to the automotive sector, there isn’t a lot leftover for the stationary market. For the system integrators and developers to continue to compete for that small segment left of supply is going to be challenging over the next two, three years, until new factories and manufacturing capacity is built out,” he said. 

Forsyth spoke recently about the growing level of competition between energy storage system integrators — including new entrants to the space from developers to battery makers that have diversified into the space — after IHS Markit published its annual survey on the 2021 system integrator landscape.

The major players are able to secure long-term battery supply deals: top-ranked integrator Fluence said ahead of its IPO last year that it has secured 20GWh of supply until the end of 2024. The company also has a partnership with Northvolt, which has the first of its gigafactories in Europe ramping up by the end of that timeframe. Even so, it recently announced future contracts will be signed pegged to raw materials index-based pricing.

Powin Energy, also in the top 10 ranking, has got multi-year deals with Chinese cell manufacturers CATL and EVE Energy. 

“The important thing to realise here is just how small a market the stationary energy storage market is relative to EVs,” he said.

Even the biggest companies in the space will be de-prioritised against electric transport sector customers, which is “just something that the stationary market needs to get used to”.

Even Tesla, again highly-ranked in the survey, which produces its own cells is not immune, with the company’s leadership having revealed that its own EV division had to take priority over stationary storage last year for materials supply. It still managed to deploy nearly 4GWh of storage in 2021.

In the short term, it makes sense then to diversify or expand the base of suppliers, which IHS Markit is seeing across the system integrator landscape. System integrators are starting to sign contracts and long-term MOUs with Tier-2 suppliers, he said. 

“It makes sense because you don’t want to be stuck with one supplier for competitive reasons. For pricing, you don’t want them [suppliers] to have that kind of price control over you. But also, from a risk perspective, if for some reason they cannot honour that agreement, you want to be able to know that you can turn to someone else.”

Historically there has been a very small pool of bankable Tier-1 cell suppliers, perhaps as few as four, but lenders and investors are starting to be a bit more comfortable working with suppliers outside that bracket. 

It helps also that many of those investors are not that new to the market any more. Some have experience over multiple projects and portfolios and have started to understand and be happy to take on the level of risk involved, Forsyth said.

Those more experienced investors have started to consider going with cheaper Tier-2 options. That applies for their choice of system integrator as much as it does their integrators’ selection of cell suppliers. 

“When you come to financing, if who you’re trying to get involved in someone [for whom it is] their first time investing in battery storage, they sometimes want security, they want to be able to know that this project is in good hands.”

“That is when your Tier-1s just come into play — but then we’re seeing, more and more where there’s been people investing into multiple battery projects now, they are getting comfortable with the level of risk involved in this market. They start to think, ‘Okay, we are comfortable, we understand this technology. Potentially, we can try to find a lower cost partner,’

“… and that’s where potentially some of these newer system integrators — or if you’re looking at the battery manufacturing space, some of the Tier-2 cell providers — come into play. We start to see people willing to take that risk and try to test out some of these newer players, because they are sometimes cheaper and that is an advantage for them.”

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Countries in West Europe are mutualising a secondary reserve service and storage could be a big winner. Image: Sutthipong Kongtrakool
| Moment RF/Getty Image

Energy storage could garner a market share of one-third by 2025 for the new, pan-European automatic frequency restoration reserve (aFRR) market, which is set to launch in the middle of this year with France and Germany sharing their capacity first.

That is according to Corentin Baschet of consultancy Clean Horizon, which has done a lot of work on an upcoming project called PICASSO which will mutualise aFRR services across West Europe. He told Energy-Storage.news that France and Germany will kick things off by mutualising their services around the middle of 2022, a bit later than initially planned (Q1).

The project has trigged a review of market rules which exclude storage from participating in the main European secondary reserve market in most countries, something which is expected to change with the new aFRR scheme’s launch and rollout.

“Increasing the participation of battery storage is definitely one part of Picasso but it’s not at the forefront of their mind, there will still be loads of conventional assets participating,” Corentin said.

“By 2025, we think a third of the aFRR market in West Europe could be for battery storage if the rules and price signals are improved. So that could be something like 500MW for storage in aFRR in Germany alone where the aFRR services market represents a volume of 1.5-2GW.”

He says that the rules in Belgium are much more friendly to storage and today there are more than 30MW of batteries active in the aFRR market, including a 10MW system optimised by Centrica Business Solutions which joined in December.

“More than 200MW of storage will be deployed in Belgium to address this opportunity,” he says, adding that 130MW/450MWh of projects were awarded in the recent capacity market auction.

The aim of sharing aFRR across borders is to reduce the cost of provision, he explains. “It might be that France has more expensive AFRR than Germany has, so if you export energy activation across borders that reduces the cost of ancillary services, which ultimately reduces the cost for the consumer. A portion of everyone’s bill goes to balancing the grid.”

Growth in this revenue stream for energy storage could not come as a better time as revenues from primary reserve decline.

Primary reserve (FCR) and secondary reserve (aFRR) make up frequency control reserve services which ensure the grid’s balance between generation and consumption. In 2020, aFRR services paid over €100k/MW/year (US$111k) versus around €70k/MW/year for FCR.

Primary reserve stops extreme frequency drift when there is an imbalance event with a big and rapid-response (

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Primergy Solar LLC, a developer, owner and operator of utility and distributed scale solar and storage, has selected major equipment suppliers and construction partners for the $1.2 billion Gemini Project located near Las Vegas, Nev. Primergy is a portfolio company of Quinbrook Infrastructure Partners.

After a comprehensive and detailed procurement process, Primergy selected Kiewit Power Constructors Co. as Gemini’s engineering, procurement and construction (EPC) partner and IHI Terrasun Solutions as the battery storage integrator. Maxeon Solar Technologies was also selected to provide its high-efficiency bifacial solar modules.

“The final selection of equipment supply and construction partners for Gemini has been a long, detailed and thoughtful process,” says David Scaysbrook, managing partner of Quinbrook. “The Quinbrook and Primergy teams have worked diligently to evaluate each supplier’s credentials and track record from an ESG perspective in accordance with Quinbrook policies. This includes detailed supply chain investigation and materials sourcing to ensure we have procured responsibly, especially in a challenging market and regulatory environment for solar and storage equipment.”

The Gemini project is a $1.2 billion, 690 MW AC/966 MW DC solar array and 1,416 MWh storage facility. The project will feature over 1.8 million solar modules installed on approximately 6,500 acres of federal land and will produce enough clean energy to power the entire city of Las Vegas. During the construction phase, Construction is expected to be completed in 2023 with operations beginning shortly thereafter.

“The Gemini Project is extraordinary in its scope and scale, and we are excited to join Primergy in significantly expanding the availability of clean energy,” comments Dave Flickinger, executive vice president of Kiewit Energy Group, Inc. “With more than 40 years of experience in developing renewable energy projects, we are well equipped to deliver an outstanding solar array and battery system while also supporting Primergy’s commitment to safety, reliability, environmental stewardship and the surrounding community.”

“IHI Terrasun is proud to be part of such a historic moment,” states Jamal Burki, president of IHI Terrasun. “We look forward to bringing our advanced DC-coupled solar and storage solutions to the Gemini Project while employing our lifecycle services aimed at ensuring a smooth and reliable operations for all involved.”

Primergy has invested significant resources to minimize the physical footprint of the Gemini project where practicable to both preserve and protect local flora and fauna. The company has partnered with biologists to create the industry’s first Desert Tortoise Relocation Plan, which tracks, cares for and will safely reintroduce the protected species back into their natural habitat once construction is complete. Additionally, Primergy will implement responsible and efficient construction processes, such as using alternative site preparation methods and establishing narrow road corridors into the project site as well as building appropriately spaced, raised rows of solar modules to ensure nearly 80% of the land on site remains open to the sky.

“While the size, scale and innovative integration of solar PV coupled with battery storage makes Gemini one of the most complex clean energy projects ever developed, Gemini also sets new and timely benchmarks in sustainable infrastructure development,” explains Ty Daul, CEO of Primergy. “Through Gemini, Primergy has pioneered a holistic approach to responsible project development that considers complete ecosystem management, collaborative partnerships with local and community stakeholders and undertakes careful due diligence in supply chain and equipment selection. This ensures the company procures responsibly, minimizes environmental impact and delivers lasting community benefits across jobs, training and ongoing education in the benefits of large-scale clean energy infrastructure.”

Primergy’s Nevada portfolio alone exceeds 1,300 MW AC of solar and 3,330 MWh of battery energy storage systems under contract with NV Energy as well as multiple additional projects in the development phase.

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New Energy Equity’s completed Ledeboer Community Solar Garden project, located in Minnesota

ALLETE Inc. is expanding its interested in the solar energy sector with the acquisition of 100% of the membership interests of distributed solar developer New Energy Equity LLC for approximately $165.5 million, subject to a working capital adjustment.

New Energy Equity, with headquarters in Annapolis, Md., is a distributed solar development company that has successfully completed more than 250 projects across the nation totaling more than 310 MW. New Energy Equity also offers comprehensive solar operations, maintenance and asset management services to its customers through its wholly owned subsidiary, Energy Support Services.

“New Energy Equity’s strong track record of success, talented and experienced team, robust project pipeline and significant growth potential will support ALLETE’s long-term average annual growth objective of 5 percent to 7 percent,” says Bethany Owen, ALLETE’s chair, president and CEO. “The company is a natural fit with our sustainability-in-action strategy and shares our commitment to transforming the nation’s energy landscape. Solar is an exciting and expanding area of our industry’s clean-energy transformation, and New Energy Equity brings to ALLETE the expertise and experience to offer comprehensive solar solutions to customers, adding to our existing wind energy capabilities.”

“Our team is excited to join the ALLETE family of companies, bringing broadened expertise and access to capital to New Energy Equity,” comments Matthew Hankey, New Energy Equity’s president and CEO. “ALLETE is an incredible organization that shares in our company’s core values, including a focus on sustainability, long-term partnerships and a workforce culture that promotes and values employee contributions. With our combined experience, we can expand the reach of distributed-generation solar and storage projects to provide more sustainable energy solutions for our communities, industry partners and customers.”

ALLETE expects the purchase to close in mid-April upon satisfaction of customary closing conditions, including compliance with Hart-Scott-Rodino antitrust clearing requirements. New Energy Equity’s entire team, including management, will remain in place, as will its Maryland headquarters. J.P. Morgan acted as exclusive financial advisor to ALLETE on this transaction.

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Retailer Meijer has signed a renewable energy power purchase agreement (VPPA) with developer Duke Energy Sustainable Solutions, which states Meijer will purchase a portion of all energy generated by the project for the first 15 years of operation. The project broke ground in Navarro County, Texas on 1,800 acres of land and is expected to be completed by the end of the year.

“At Meijer, we are motivated to make an impact in the local communities we serve, and beyond, by doing our part and taking the necessary steps to reduce carbon emissions,” says Rick Keyes, Meijer’s president and CEO. “Meijer has made significant progress over the years to integrate sustainability into our daily operations. We’re committed to these ongoing efforts and a project like this brings us closer to our industry leading sustainability goals.”

Each year, the Pisgah Ridge Solar project will generate approximately 200,000 MWh of energy for the first year dedicated to Meijer. This clean energy will account for a reduction of more than 103,000 metric tons of CO2e from the retailer’s operations.

“Renewable energy assets like the Pisgah Ridge Solar project contribute to a cleaner, stronger economy and help create a more diverse energy infrastructure,” states Chris Fallon, president of Duke Energy Sustainable Solutions. “We’re pleased to be working with Meijer to create jobs, strengthen the local economy and generate cleaner energy, while also helping them address their carbon reduction goal.”

“We’re proud to be part of this project to enable energy creation through a renewable energy source,” comments Erik Petrovskis, director of environmental compliance and sustainability at Meijer. “We believe we have a responsibility to improve the world around us because it’s the right thing to do.”

Schneider Electric supported Meijer in the selection of and negotiations for the solar project.

“As one of the largest Midwest supermarket chains, Meijer has made commitments to reduce their carbon emissions by 2025, and it is an honor for Schneider Electric to advise them on adding renewable energy to their portfolio,” says Steve Wilhite, president of Schneider Electric’s Sustainability Business. “The need for organizations to take immediate action to decarbonize is at an all-time high, and we are excited to see organizations like Meijer leading the charge to include renewable energy as a part of their long-term strategy.”

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Executives from the EBRD and the national public utility ESM recently visited the facility to check the progress of the project, which is already well advanced.

North Macedonia’s first large-scale photovoltaic (PV) plant is already under construction, and about to be completed. The Oslomej solar project, financed by the European Bank for Reconstruction and Development (EBRD), has been built alongside a coal-fired power plant located in Kichevo and is equipped with eight Ingeteam solar inverters of 1,400 kW each.

This PV plant is the first phase of a larger project that includes the construction of hundreds of MWs of PV power plants, which are planned to be announced in the upcoming months. This first phase of 11.7 MW of installed power has been built by Europower Solar, belonging to the Turkish group Girisim Elektrik A.S.

Executives from the EBRD and the national public utility ESM recently visited the facility to check the progress of the project, which is already well advanced. Future PV plants to be developed to complete the project pipeline on this location will be built on a former coal mine.

The Oslomej project is an important milestone for North Macedonia, since it marks the firm commitment of the country’s government to the energy transition towards a cleaner generation model, as reflected in the energy law approved by the government in December 2020.

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The Gemini Project near Las Vegas, Nevada, US. Image: Quinbrook.

Quinbrook’s solar and storage developer Primergy has chosen the equipment and construction partners for its US$1.2 billion Gemini Project in Nevada, US, which will have a 1,416MWh battery energy storage system (BESS).

Kiewit Power Constructors Co. will be the Gemini project’s engineering, procurement and construction (EPC) partner and IHI Terrasun Solutions will deliver and integrate the BESS. The project is expected to be completed in late 2023 and start operations soon after.

Primergy says the BESS will have a capacity of 1,416MWh, making it easily one of the largest solar-plus-storage projects in the US and, by extension, the world.

David Scaysbrook, Managing Partner of Quinbrook Infrastructure Partners which launched Primergy in 2020, commented:

“The Quinbrook and Primergy teams have worked diligently to evaluate each supplier’s credentials and track record from an ESG perspective in accordance with Quinbrook policies. This includes detailed supply chain investigation and materials sourcing to ensure we have procured responsibly, especially in a challenging market and regulatory environment for solar and storage equipment.”

The Gemini project’s 1.8 million bifacial solar modules, for which Maxeon was chosen as supplier last year, will provide 690MWac/966MWdc of solar power, enough to power the entire city of Las Vegas, Primergy said.

Primergy has already had a 25-year power purchase agreement (PPA) with Berkshire Hathaway-owned utility NV Energy in place for Gemini. The partnership between the two companies is extensive with 1,300 MWac of operational solar and 3,330 MWh of BESS under contract between them.

The company says it has made significant efforts to minimise the impact of the project’s footprint on local flora and fauna, including creating the industry’s first Desert Tortoise Relocation Plan in partnership with biologists.

Other notably large solar-plus-storage projects include utility Florida Power & Light’s recently completed Manatee project which has a 900MWh solar-charged BESS and developer Terra-Gen’s Edwards Sanborn project in California. Terra-Gen is building Edwards Sanborn in phases, hoping to eventually reach 760MW PV and 2,445MWh of BESS, and has already reached financial close for 346MWac PV and 1,501MWh of battery storage. Part of that project, which has multiple off-takers, is already online.

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The Battery Passport initiative is part of a raft of upcoming legislation to be voted on in the EU parliament. Image: Flow Batteries Europe.

Trade body Flow Batteries Europe (FBE) has written to EU legislators imploring them to include its members’ products in the scope of upcoming Battery Passport regulations.

The Battery Passport scheme will mean that all components and systems that go into a battery’s production will have to be traceable, ensuring the social and environmental sustainability of energy storage.

But the current proposal, part of a raft of upcoming legislation around making the battery sector more sustainable – ‘Sustainable Batteries Regulation’ – focuses on batteries with internal storage, which excludes other technologies like flow batteries.

Anthony Price OBE, Secretary-General of Flow Batteries Europe, commented: “Flow batteries already present strong sustainability benefits, and the industry is willing to push them even further. However, we need a signal from the legislators. The European Union must put in place the right investment and legislation for long-duration energy storage to thrive.”

The FBE sets out commercial and environmental concerns in a position paper. The first issue is that the current proposals may be seen as giving an unfair advantage to internal storage batteries over other types, and may also distort the flow battery market itself.

Because many of the Battery Passport’s key disclosure requirements like carbon footprint, safety and supply chain due diligence are already requested by both flow and lithium battery customers, a standardised and widely-accepted list of information would help the industry. But implementing this, which the scheme does, for only one technology implies that technology is preferred over others.

An example it highlights is awarding Passport-included batteries a carbon footprint performance class which would not be available to the excluded technology.

Within the flow battery sector itself, it might also give an unfair advantage to producers who decide not to collect and make available such information without an explicit requirement to do so. It raises the possibility of cheaper flow battery products with lower environmental standards from outside the EU flooding the market.

A second issue raised by FBE is an environmental one and relates to something raised by many delegates and speakers at Energy Storage Summit 2022 last week in London. It says that ‘renewable gaps’ in one local grid studied lasted for 8-10 hours and not just the 1-2 hours that short-duration storage could address.

It also argues that flow batteries already score well on sustainability with long cycle life meaning 20-year-plus lifetimes, which further bolsters the argument to include them in carbon footprint performance rankings.

It finishes the paper by saying that flow batteries shouldn’t be included under all of the requirements since some are only relevant for technologies like lithium-ion.

It recommends including flow batteries for “…key sustainability requirements of the Battery Passport, such as the carbon footprint calculation, safety and supply chain due diligence”.

Energy-storage.news has asked the European Commission’s press team to address these points and will include their response when it is received.

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US President Joe Biden. Image: Flickr user Phil Roeder.

President Joe Biden’s first State of the Union (SOTU) address included strong messaging on the importance of both supply and demand side measures to support clean energy and its role in the US economy. 

That included emphasis on renewables and tax incentives, urging Congress to pass proposed budgetary measures that would enable investment in both the supply chain and deployment of solar and wind — including doubling the production of both — and lowering the price of electric vehicles (EVs). 

Tax incentives on the table as part of the bipartisan Build Back Better bill include the investment tax credit (ITC) for standalone energy storage, which has been much talked-about here on Energy-Storage.news and elsewhere. The ITC, including a direct-pay option, would turbocharge the energy storage industry in the country, reducing the cost of upfront investment by around a third, with analysis firm Wood Mackenzie having forecast this could create a 20% uplift on deployments. 

“Let’s provide investments and tax credits to weatherise your homes and businesses to be energy efficient and you get a tax credit; double America’s clean energy production in solar, wind and so much more,” Biden said in his speech.

Measures to combat the climate crisis would reduce average household energy costs by US$500 a year, he added. 

The president also reiterated calls for strengthening domestic supply chains of key materials, components and technologies, particularly in light of the pandemic-related delays caused to supply chains everywhere which he said highlighted the importance of being able to establish some self-reliance versus importing a large majority of materials.

While Biden’s speech made semiconductors as an example to directly reference, mentioning Intel’s US$20 billion semiconductor ‘mega site’ factory which the company is building in Ohio, Biden has previously focused on the importance of batteries and battery materials for EVs and grid storage. 

‘Decarbonisation linked to global and national security’

In 2021, Biden had “bolted out of the starting gate to address the climate crisis as the emergency it is,” in rejoining the Paris Agreement, setting climate targets and signing the bipartisan Infrastructure Investment and Jobs Act, Dan Lashof, US director of non-profit research group World Resources Institute said in response to the SOTU speech. 

“Despite Biden’s efforts, the US is not on track to achieve its ambitious climate targets and avert the worst climate impacts. It’s time for the U.S. Congress to catch up. Congress should heed Biden’s call to pass a climate-smart budget package to create millions of good-paying jobs in different sectors, including clean energy, electric transportation, building energy efficiency and more,” Lashof said.

The latest Intergovernmental Panel on Climate Change (IPCC) report published this week made it abundantly clear that “the world cannot afford for President Biden to slow down,” Lashof said.

“President Biden urged Congress to pass our clean energy tax package. This is our last chance to prevent the most catastrophic effects of the climate crisis, and Russia’s invasion of Ukraine has provided a stark reminder this week of the urgent need to free ourselves from the need for oil and gas from despots,” Senate Finance Committee Chair Ron Wyden said.

“Enacting our package of clean energy tax incentives, which would lower emissions by the power sector by more than 70%, is essential for the climate, family budgets, and global security.”

In a further statement, Wyden, an Oregon Democrat, said the package of clean energy tax incentives is first and foremost a way to drastically lower carbon emissions, but it would also reduce energy costs and lessen the US’ reliance on foreign oil and gas, “including from authoritarian regimes,” bolstering national security and diplomatic strength. 

Similarly, Heather Zichal, CEO of the American Clean Power Association (ACP) — which has since the beginning of this year been merged with the national Energy Storage Association (ESA) — said the SOTU speech was “emphatic and unmistakably clear about the urgency of rapid clean energy investment”.

“The invasion of Ukraine reminded us that bullies like Vladimir Putin can play games with energy to hold countries hostage. This week we also heard the world’s leading climate scientists tell us that our planet is warming at an alarming rate,” Zichal said. 

“The way out of both of these crises is to rapidly scale affordable, reliable clean energy everywhere. We join the President in urging Congress to take action on critical investments and tax credits for the renewable energy industry that have broad bipartisan support. Quick action will create good jobs and allow the rapid deployment of clean energy projects in all 50 states.”

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