Discover the power plant of the future: solar and battery hybrids are poised for explosive growth

The US electrical system is undergoing drastic changes as it transitions from fossil fuels to renewables. While the first decade of the 2000s saw huge growth in natural gas production and the 2010s was the decade of wind and solar, early signs suggest that the innovation of the 2020s could be a boom in “hybrid” power plants.

A typical hybrid power plant combines electricity generation with battery storage in the same location. This often means a solar or wind farm combined with large-scale batteries. Working together, solar panels and storage batteries can generate renewable energy when solar power is at its peak during the day, then release it as needed after the sun goes down.

A look at power and storage projects in the development pipeline offers a glimpse into the future of hybrid power.

Our team at the Lawrence Berkeley National Laboratory found that a staggering number 1,400 gigawatts of proposed generation and storage projects have requested to connect to the grid, more than all existing US power plants combined. The majority are now solar projects, and more than a third of these projects involve hybrid solar and storage plants.

If these plants of the future offer many advantages, they raise questions on how best to operate the power grid.

Why hybrids are in vogue

As wind and solar grow, they start to have big impacts on the grid.

Solar energy already exceeds 25% of annual electricity production in California and is rapidly spreading to other states such as Texas, Florida and Georgia. The “Belt of the Winds” states, from the Dakotas to Texas, have seen massive deployment of wind turbinesIowa now draws most of its energy from the wind.

This high percentage of renewable energy raises a question: how do you integrate renewable sources that produce significant but varying amounts of electricity throughout the day?

Joshua Rhodes/University of Texas at Austin.

This is where storage comes in. Prices for lithium-ion batteries have quickly fell as production has increased for the electric vehicle market in recent years. Although there are concerns about the future supply chain challengesbattery design is also subject to change.

The combination of solar and battery power enables hybrid power plant operators to provide power during the most valuable hours when demand is greatest, such as summer afternoons and evenings when air conditioners are running at full speed. Batteries also help smooth wind and solar power generation, store excess energy that would otherwise be reduced, and reduce congestion on the grid.

Hybrids dominate the project pipeline

At the end of 2020, there were 73 solar and 16 wind hybrid projects in operation in the United States, representing 2.5 gigawatts of generation and 0.45 gigawatts of storage.

Today, solar and hybrids dominate the development pipeline. At the end of 2021, more than 675 gigawatts of solar proposed factories had requested permission to connect to the network, more than a third of which were coupled with storage. An additional 247 gigawatts of wind farms were online, including 19 gigawatts, or about 8% of those, in hybrids.

Bar graph showing an overwhelming increase in solar power since 2014 compared to other sources and a rapid increase in batteries over the past two years.
The amount of solar, storage and wind power on offer awaiting grid connection has increased significantly in recent years, while coal, gas and nuclear have faded. Lawrence Berkeley National Laboratory

Of course, requesting a connection is only one step in the development of a power plant. A developer also needs land and community agreements, a sales contract, financing and permits. Only about one in four new plants proposed between 2010 and 2016 have been put into commercial operation. But the depth of interest in hybrid plants portends strong growth.

In markets like California, batteries are essentially mandatory for new solar developers. Since solar often represents the majority power in the day market, building more adds little value. Currently, 95% of all utility-scale solar capacity offered in the California queue comes with batteries.

5 hybrid lessons and questions for the future

The growth opportunity of renewable hybrids is clearly large, but it raises questions that our group at Berkeley Lab investigated.

Here are some of our best discoveries:

  • The investment pays off in many areas. We have found that while adding batteries to a solar power plant increases the price, it also increases the value of the energy. Placing production and storage in the same location can reap the benefits of tax credits, construction cost savings, and operational flexibility. Looking at the earning potential over the past few years, and with the help of federal tax credits, the added value seems to justify the higher price.

  • Collocation also means compromises. Wind and solar work best where wind and solar resources are strongest, but batteries offer the most value where they can deliver the greatest grid benefits, such as reducing congestion. This means there are tradeoffs when determining the best location with the highest value. Federal tax credits that can only be obtained when batteries are co-located with solar power may encourage suboptimal decisions in some cases.

Rows of solar panels and two batteries the size of small shipping containers sit in a field.
Hybrid power has become the norm in Hawaii as solar power saturates the grid. Dennis Schröder/NREL
  • There is no better combination. The value of a hybrid power plant is determined in part by the configuration of the equipment. For example, the size of the battery compared to a solar generator can determine until what time of the evening the plant can provide electricity. But the value of nighttime electricity depends on local market conditions, which change throughout the year.

  • The rules of the electricity market must evolve. Hybrids can participate in the electricity market as a single unit or as separate entities, with solar and storage offerings being independent. Hybrids can also be sellers or buyers of electricity, or both. It can get complicated. Market participation rules for hybrids are still evolving, leaving power plant operators to experiment with how they sell their services.

  • Small hybrids create new opportunities: Hybrid power plants can also be small, like solar and battery in a home or business. Such hybrids have become the norm in Hawaii because solar energy saturates the grid. In California, customers subjected to power outages to prevent wildfires are adding more and more storage to their solar systems. these hybrids “behind the meter” raise questions about how they should be evaluated and how they can contribute to network operations.

Hybrids are just getting started, but many more are on the way. Further research is needed on technologies, market designs and regulations to ensure that the network and network pricing evolves with them.

While questions remain, it’s clear that hybrids are redefining power plants. And they can redo America’s electrical system in the process.

The conversation

Joachim SeelSenior Associate in Scientific Engineering, Lawrence Berkeley National Laboratory; Bentham PaulosAffiliate, Electricity Markets & Policy Group, Lawrence Berkeley National Laboratoryand Will Gormangraduate student researcher in electricity policies and markets, Lawrence Berkeley National Laboratory

This article is republished from The conversation under Creative Commons license. Read it original article.