Because renewable energy technologies like wind and solar don’t always produce energy when we want them to, it’s often argued that we’ll have to store wind and solar energy in giant batteries or other forms of grid energy storage before we can fully transition the electricity system toward renewable sources. Energy storage is touted as the “holy grail” that will unleash renewable energy and allow it to fully compete with its nonrenewable counterparts.

While there’s no doubt that energy storage can help integrate renewable energy with the grid, a recent study by Eric Hittinger of the Rochester Institute of Technology and Inês Azevedo of Carnegie Mellon University indicates that bulk energy storage would most likely increase total U.S. electricity system emissions if it were installed today, because it would typically store electricity generated from fossil fuels rather than renewable sources.

So what’s going on here? On the one hand energy storage is the “holy grail” for renewable energy. On the other hand, experts say storage could increase emissions. With this post I’ll explain how energy storage influences total emissions from the electricity system, and why researchers say energy storage could be bad for emissions in the short term.

Unlike a conventional power plant, most forms of energy storage don’t produce any on-site emissions. There’s no smokestack or combustion associated with conventional pumped-hydroelectric energy storage or emerging battery systems. Rather, most emissions from grid energy storage are caused by the upstream and downstream effects that storage has on the wider grid.

One of the key applications for energy storage is charging when electricity demand and the wholesale electricity market price are low and then discharging when electricity demand peaks and the wholesale price is higher. Because the energy storage plant buys electricity when it’s cheap and then sells electricity when it’s expensive, it accumulates revenue that can be used to pay off its upfront capital cost.

The effect that an energy storage plant operating in this way has on total emissions depends on what type of power plants turn on to fulfill the new demand caused by the storage plant charging, and what type of generators are offset when the storage plant discharges. If energy storage charges with wind energy and offsets coal, it’s definitely good for emissions. If it charges with coal and offsets natural gas, then it’s definitely bad for emissions. But which one of these situations is most likely?

The goal of Hittinger and Azevedo’s study was to predict which generators would be used to charge energy storage and which generators would be offset as energy storage discharges. To predict when energy storage would charge and discharge, they modeled how an energy storage plant would economically respond to price fluctuations in various U.S. electricity markets. Then, they used data showing which generators are likely to respond to a change in electricity demand at various times of day to predict which generators would come online to fulfill additional demand as energy storage charges and which generators would be offset when energy storage discharges.

The results of the study indicate that an energy storage plant that responds to electricity market price signals in an optimal way would typically charge with coal electricity, and then offset peaking natural gas generation, because the market price of natural gas electricity is typically higher than the price of coal electricity. Because burning coal produces about twice the greenhouse gas (GHG) emissions of burning natural gas, total GHG emissions would likely increase—even if energy storage operates with 100 percent round-trip efficiency. When you add in energy losses associated with the energy storage conversion processes, the situation gets even worse.

This figure illustrates annual revenue potential versus greenhouse gas emissions for an energy storage plant operating in various U.S. regions. Each curve corresponds to an energy storage plant with a round-trip efficiency ranging from 60% to 100% operating in a particular U.S. region. Only storage with 100% round-trip efficiency could decrease overall greenhouse gas emissions. (Source: Hittinger and Azevedo, 2015)

Despite the typical notion that energy storage is a “green” technology, Hittinger and Azevedo’s study indicates energy storage likely wouldn’t charge with electricity generated from renewable sources. There’s no incremental cost associated with producing electricity from wind or sunshine, so unlike a conventional power plant a wind or solar farm is almost never dialed back due to low electricity demand. Thus, wind and solar couldn’t suddenly increase their output to charge energy storage. Rather, a coal plant would most likely dial up its output to meet the new demand for electricity from energy storage.

Simply put, energy storage that participates in today’s electricity market in an economic way would most likely store electricity from coal plants, and then undercut peaking natural gas plants, causing total emissions to increase.

While energy storage operating on today’s grid would likely increase total emissions, it’s important to remember that the emissions associated with energy storage are almost wholly associated with the local mix of electricity sources—and this mix is subject to change. As the amount of renewable energy installed on the electric grid increases, there will be a growing number of occasions where renewable energy production must be forcibly curtailed to prevent overloading a transmission line, shutting off a “reliability must-run” power plant, or destabilizing the power grid. During these occasions, energy storage could charge with renewable energy that otherwise would not have been delivered to the grid, and then discharge later in the day to offset a coal or natural gas power plant, causing total greenhouse gas emissions to decrease. However, this sort of scenario is rare on today’s grid with its small share of renewable energy.

As state and federal policymakers consider energy storage incentivesmandates, or demonstration programs, they should critically consider the particular impact that energy storage might have on emissions. Unlike renewable energy, energy storage in the form of batteries or other technologies is not a definitive good thing for the climate, so it shouldn’t be treated like it is. Energy storage that enables renewable energy in regions where it is constrained (e.g. Hawaii) can help to reduce carbon emissions—but energy storage that simply stores off-peak fossil fuel electricity will almost certainly increase carbon emissions. 

Reference: Hittinger and Azevedo, 2015.