Lithium-ion battery levelized energy costs have dropped significantly

by:CTECHi     2021-07-08

According to a survey by Bloomberg New Energy Finance, in more and more markets today, battery energy storage systems for long-term energy storage can compete with natural gas and coal power generation.

The long-term cost of today’s lithium-ion battery energy storage system that supplies power to the grid continues to decline, even faster than people’s expectations, making it cost-competitive and increasingly becoming the main energy source Alternatives to natural gas power plants on the market.

This is the survey result of the levelized energy cost (LCOE) of the energy storage system in the survey report recently released by Bloomberg New Energy Finance. This is a technology that provides energy during its life cycle and can be used in many key clean energy technologies.

Based on its analysis of public and proprietary data of more than 7,000 energy storage projects around the world, since the first half of 2018, the level of energy costs of lithium-ion batteries (LCOE) has dropped by 35% and has fallen to US$187 per MWh. The magnitude of its decline exceeds the continuous decline in the level of standardised energy costs (LCOE) for solar power generation facilities and onshore and offshore wind power generation.

In the past year, the levelized cost of energy (LCOE) of offshore wind Previously, its cost was about $220 per MWh. The levelized cost of energy (LCOE) of onshore wind power and solar power has dropped by 10% and 18%, respectively. The prices of projects that started construction in early 2019 were US$50 per MWh and US$57 per MWh, respectively.

It is certain that these power generation technologies are still much cheaper than battery energy storage systems in terms of levelized energy cost (LCOE), and this does not mention that they are actually The above is power generation technology rather than energy storage technology. In order to convert the capacity of the battery energy storage system into levelized energy cost (LCOE) data, the report models the utility-scale battery installations that operate every day, assuming that the charging cost is 60% of the relevant wholesale basic electricity price.

Bloomberg New Energy Finance pointed out that even so, the rate of decline in battery levelized energy costs (LCOE) is still surprising, especially for previous generations of lithium-ion batteries. In terms of long-term energy storage applications provided. Since 2012, based on historical data, the benchmark levelized energy cost (LCOE) of lithium-ion batteries that provide 4-hour power supply has dropped by 74%, which is a standard requirement for many grid services.

In contrast, since 2010, the levelized cost of energy (LCOE) of onshore wind power, solar photovoltaic and offshore wind power has dropped by 49%, 84%, 56%.

The report pointed out that, in the absence of subsidies, the levelized energy cost (LCOE) of long-term lithium-ion battery energy storage systems began to compare with coal-fired power generation and gas. The cost of power generation competes in the market and can provide electricity when the grid needs it (rather than when wind and sunlight are sufficient).

These survey results are consistent with those provided by Wood Mackenzie Power u0026 Renewables and other industry analysts. In the past year and a half, bids for several large-scale solar + energy storage projects have reached a record low, including Xcel Energy of Colorado, which has a solar energy + energy storage bid price of 36 US dollars per MWh. The price of independent solar power generation facilities is $25 per megawatt hour, while the bid price of Nv Energy's solar and solar + energy storage projects is even lower.

Ravi Manghani, head of energy storage research at Woodmac, reported at the Green Technology Media Energy Storage Summit held in December last year that these price points are equivalent to independent solar power generation facilities Solar projects have a premium of about US$6 to US$7 per MWh, which is partly 'dispatchable' with traditional power plants.

At the same time, it is worth noting that the current pricing trend of lithium-ion batteries is mixed. Although the continuous improvement of technology and the continuous expansion of the manufacturing scale have depressed prices, in the past year, driven by the surge in demand for large-scale energy storage projects in the United States and South Korea, the bottleneck in the supply of battery products has been offset to a certain extent These factors.

WoodMac found that, based on the challenges of these battery supply shortages, battery prices only dropped by about 6% from 2017 to 2018, instead of the 14% previously predicted.

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