Subsidies for Energy Storage Systems Vital to Adoption of Renewables - Energy Storage Infographic

A 100% transition to renewable energy sources depends, in large part, on the effectiveness of the systems tasked with storing renewable energy.

Superior energy storage systems can bolster the consistent availability of energy from “variable output” sources like wind and solar, at the same time further reducing reliance upon traditional on-demand energy sources like coal.

Researchers at the University of East Anglia (UEA) Norwich Business School evaluated the economics of such energy storage systems. These systems’ significant capital cost can be partly offset by revenue from energy market “arbitrage” — that is, buying energy when prices are low and selling energy when prices are high. However, the study found that arbitrage alone “cannot provide adequate revenue to justify investment.” This is where government subsidies should come in, helping favor investment in renewable energy storage systems.

IRENA Renewable Energy Storage Visualization

Government subsidies would contribute to a virtuous cycle:

  • As renewable energy storage systems become increasingly widespread and advanced, the economics of renewable energy sources become increasingly appealing, in that more of their output can be used.
  • As the economics of renewable energy become more appealing, and renewable energy becomes increasingly common, demand for increasingly efficient renewable energy storage systems accordingly rises.

Sodium Batteries: Potential Energy Storage Solution

This would also benefit environmentally conscious electric vehicle owners, who could more easily charge their EVs with clean electricity rather than electricity derived from coal and other highly polluting sources. Note: EVs that use dirty electricity are still better for the environment than internal combustion engine (ICE) vehicles. But EVs that use clean electricity are even better.

How can we advance renewable energy and renewable energy storage in the United States? The Clean Power Plan, proposed by the Environmental Protection Agency in 2014, favors renewable energy and corresponding storage systems over sources like coal.
Unfortunately, the Supreme Court recently “stayed” the Clean Power Plan which is now “pending judicial review.” This does not, however, prevent state-level governments from independently pursuing the plan’s goals. The Union of Concerned Scientists arranged an easy-to-fill-in electronic form to contact governors and encourage them to support this alternative approach.