CAES

Storelectric Ltd

Project developers of grid-scale

Compressed Air Energy Storage (CAES)

How CAES works

Storing energy in compressed air has been around for decades, and has been used world-wide in many systems.

 

When power is abundant and demand is low, it’s drawn from the grid to compress air into a salt cavern hundreds of metres underground. When the power is needed, the air is let out from the cavern to regenerate the electricity.

 

Salt caverns have been used for many decades to store natural gas because not only are they naturally hermetic, but also salt undergoes plastic flow under pressure, so it seals any cracks that may occur. And what is safe for gas is safer for air.

 

There are salt basins globally, in which caverns can be made cheaply and easily.

 

Both unique and well proven

Storelectric's CAES design is brings known sub-system technologies, well proven at comparable scales, from other industries into CAES. This equipment has been optimised over decades in highly comptetitive situations, and made exceedingly reliable in difficult environments and extreme conditions - so why re-invent the wheel? As Siemens said in the video, "The components are available, the caverns are available, it does work and it will work."

 

The main development work in this design lies in:

  • Total system design and integration
  • Interfaces between the sub-systems
  • Control and safety systems relating to these

 

This approach minimises development time, cost and risk, while maximising overall system efficiency and reliability.

 

Currently our (pending) patents are all process IP which, for which further information can be provided on request.

EXISTING CAES PLANTS

Huntorf, Lower Saxony, Germany

Compressed air energy storage (CAES) has been in operation since 1978 in Huntorf in Germany, and since 1992 in McIntosh, Alabama, USA. Both of these plants regenerate the electricity by feeding it into a gas-fired power station, roughly tripling the efficiency of the power station.

 

When compressing the air, by the laws of thermodynamics it heats up. When expanding it again, that heat needs putting back into the air. Both Huntorf and McIntosh waste that heat, leading to only 42% overall efficiency in Huntorf and 54% in McIntosh (the difference being because McIntosh's power station is Combined Cycle).

 

McIntosh, Alabama, USA

Huntorf and McIntosh have proved useful additions to their local grids, in operation daily. Storelectric has another technology, an evolution these two plants, which can be retro-fitted to CCGT power stations that are near appropriate geologies, which burns gas and has an efficiency expected to be above 60%

 

There are three adiabatic CAES projects under way in America since 1999: General Compression, Lightsail and SustainX. Despite combined funding of $250m, since then they have only built just over 2MW in combined demonstrator capacity, with significant technical, up-scaling and down-time issues.

 

Storelectric's CAES Solution

In contrast to the existing CAES Plants, Storelectric has several solutions, which will increase our efficiency from the 42/54% of the existing plants to between 60-70% for a full-scale plant. We calculate that the threshold for profitability is below 60%, giving us significant margin. This portfolio of technology solutions enables us to configure each plant to the specific requirements of each location and its load case and operating mode.

  • Variant 1 uses methane to heat the air,
  • Variant 2 uses the heat stored during compression (which the existing plants do not utilise), and
  • Variant 3 uses hydrogen as fuel source (allowing Storelectric to transition from a methane to hydrogen based economy in the near future).

The latter two are fully green and the former uses less methane than the original CAES plants. These solutions can be hybridised and optimised depending on location, availability of fuel, investor opportunity-risk profile and other factors.

 

Storelectric also has other innovations. By having 100% renewable solutions, we already reduce the system's inertia and simplify it. simplify the system and reduce the system's its inertia and simplify it. No research is required to achieve these benefits; however, in order to maintain our technical lead, following successful installation and operation we will also pursue a whole programme of R&D focused on increasing efficiency, reducing capital and operating costs, and shortening lead times.

 

Our Variant 1 process allows the use of existing Combined Cycle Gas Turbine (CCGT) technology for CAES. It consumes little over half the gas of an equivalent-output CCGT and therefore almost halves the emissions, and has most of the other benefits of electricity storage such as demand turn-up capability. This is suitable for both new build and retro-fit, provided the location has the right geology. The retro-fittable version can be seen as a life extension of existing plants, in that their emissions reduction makes them a much more attractive asset in the context of global emissions reduction targets. Please contact Mark Howitt or Tallat Azad for further information.

 

With our variant 2 (TES) we balance the heat over the entire cycle, storing the heat of compression separately from the air, to be put back in during expansion / generation. This results in a 68-70% efficient system with no or very little gas burn (depending on configuration) and hence emissions. Our plans include a future R&D programme, which will work towards 75-85% round trip efficiency. Please contact Mark Howitt or Tallat Azad for further information.

 

Our variant 3 encompasses hydrogen as a fuel source and this can be sourced on site or through local industries that generate hydrogen as a byproduct of their traditional business. This solution allows the use of biogas and syngas or blended fuel. The solution integrates local community demand requirements such as heat, electrical load, balancing and energy storage for renewable generators to create a system. Depending on the source of the hydrogen, this too can be a zero emissions solution. Storelectric is currently developing a demo scale and full scale solution in Scotland. Please contact Jeff Draper or Paul Van Dang for further information.

 

All three variants can be applied effectively at the distribution and transmission levels, balancing the requirements of each part of the grid, and as such can make maximum use of embedded and transmission benefits. All are entirely compatible with global emissions reduction objectives.

 

Storelectric is currently investigating the potential of using depleted North Sea oil and gas fields. This would improve security of supply in a UK power sector with a high proportion of intermittent renewables. Using existing North Sea oil and gas infrastructure, fully depreciated, would be very cost effective. CAES provides a new use for such infrastructure, avoiding or smoothing decommissioning costs. The scale of depleted oil and gas fields would allow the creation of massive CAES facilities (100 TWh) that could up and balance the entire UK electricity system. This could create an engineering export opportunity for the UK in the many areas where oil & gas deposits co-exist with renewable energy resources (e.g. Middle East, North Africa, Central Asia). Offshore hydrogen versions of CAES are being developed by Storelectric and top UK universities.

 

Storelectric is at the forefront of a massive growth opportunity and its approach allows it to stay ahead of the market for the conceivable future.

Economics of CAES

All Storelectric's CAES solutions are built entirely of known subsystems, proven at comparable scales and load cases. The IRR for both TES and CCGT configurations is expected to be 10-12% with up-side potential of as much as a further 15%, at all scales from 20MW up to 100s of MW. The up-side potential is due to the conservative assumptions used in those figures, and the evolution of the markets (volume, price, spreads and market instruments).

 

A CAES plant can deliver into various revenue streams including:

  • Capacity Market;
  • Wholesale markets / arbitrage;
  • Balancing services;
  • Ancillary services.

 

It can also deliver additional benefits for infastructure deferrals and replacements, which are currently unremunerated and therefore assumed in our financial projections to generate zero revenues, and are also mostly ignored in our assessments of potential up-sides to our revenues. Nevertheless, they offer some further potential future up-sides to revenue streams and hence profitability. They include:

  • Storing otherwise curtailed renewable generation;
  • Enhancing interconnector energy flows and profitability;
  • Reducing grid connection capital and revenue costs for renewables;
  • Natural power compensation, e.g. inertia and reactive power / load;
  • Improving the business case for CCGTs (our CCGT CAES variant).

 

Thus we have a >£1trn global market, strong current and future revenues, low capital and operating costs and internal rates of return on investment of between 10% and 27% without considering the above synergies. We have mature market references and 3 main technology variants, of which we can also do hybrids depending on the application and requirements. We also have sites for our first plants.

 

As spreads between peak and off-peak prices, and price volatility, grow with the increasing share of renewables on the grid, the economics of power stations deteriorate. Meanwhile the economics of Storelectric's CAES improve fast: according to industry forecasts,the IRR (Internal Rate of Return on investment) above will be achievable solely by arbitrage tradingeither by the time the first large plant starts trading, or shortly after.

 

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