Energy Storage Toolkit 1202

February 2012
Energy Storage Toolkit

Making the right connections
Important disclosures, including any required research certifications, are provided on the last two pages of this report.

February 2012
Table of contents
1 2
Overview of the energy storage industry Energy storage technology Llithium-ion batteries Ultracapacitors Fuel cells Lithium-air batteries Lead-acid batteries Nickel-metal hydride batteries Lithium-sulphur batteries Sodium-sulphur batteries Metal-air batteries Flow batteries Flywheels Molten salt Hydropower Superconducting magnetic energy storage Compressed air energy storage Comparison of all technologies
1 10 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 41
Conclusion

February 2012
Daiwa Analysts
Energy storage: making the right connections

Daiwa forecasts world demand for electricity to rise to 23,000 terrawatt hours (TWh) by 2020 from 18,500TWh in 2010, the number of autos on the road to increase to 1.4bn by 2020 from 1.0bn in 2010, and smartphone and tablet PCs shipments to increase to 1.4bn by 2015 from 0.5bn in 2011.
Pranab Kumar Sarmah, CFA

Head of Solar (852) 2848 4441 pranab.sarmah@hk.daiwacm.com
At the same time, the need to reduce carbon emissions means that electricity generated by fossil fuel has to be replaced by renewable sources and an increase in the use of energy-efficient vehicles. Enter energy storage. We forecast the value of the energy-storage market to exceed US$100bn by 2020 from US$44bn in 2010. Daiwa is committed to providing ideas and information to investors on the clean-energy revolution. Following on from The New Energy Primer we published in September 2011, we present The Energy Storage Toolkit. With technology developments continuing apace, and cost considerations, design parameters and applications changing constantly, understanding energy storage is no easy task. This special report is designed to help you make the right connections in this fast-evolving sector. We bring together the best of Daiwas in-house research and thoughts to provide an easy-to-digest explanation of 15 types of energy-storage technologies. The report has three sections that can be read as a full series or individually, depending on the interest of the reader. Also included is a pullout summarising the characteristics, advantages, and disadvantages of 15 storage technologies. We trust that you will find The Energy Storage Toolkit a valuable aid in your investment decision-making. Please also see
The New Energy Primer: A guide to the future of power generation
September 2011
Dave Dai (852) 2848 4068 (dave.dai@hk.daiwacm.com)
Christeen So
Solar Sector (852) 2773 8769 christeen.so@hk.daiwacm.com

February 2012
1. Overview of the energy storage industry

We estimate that the value of the global energy storage market was US$44bn in 2010 and forecast it to hit US$100bn by 2020, with a CAGR of 9% from 2010-20. We expect growth to accelerate from 2013-14 to support renewable energy installations and also a reduction in capital cost/unit of energy storage.
Energy storage market forecasts by technology

(US$bn) 120 100 80 60 40 20 0 2005 Fuel cells Ultracapacitors Lithium-ion batteries Lead-acid, Ni-MH, NiCd Other Storage (Flywheel+flow battery+ NaS+ molten salt) 2010 2015E 2020E 8% CAGR 7% CAGR 10% CAGR
Energy storage market forecasts by application

(US$bn) 120 100 80 60 40 20 0 2005 IT 2010 ESS (including UPS) 2015E Auto (ex cluding SLI) 2020E Other 30 44 63 100
Source: Various sources, Daiwa forecasts
Why energy storage?

At its heart, energy storage is a convenient and economic decision. Storing energy allows humans to balance the supply and demand of energy. Electricity is the major commodity of the 21st century, but unlike water, steel, or other commodities, it is difficult to store. Storing energy has become more important with the widespread introduction of renewable energy to stop global warming, and provides good mobility/portability for consumer products.
The benefits of energy storage

Reduces carbon foot-prints: increases the use of renewable energy and lowers dependence on fossil fuels. Enhances human mobility/convenience in using portable electronic devices. Dampens volatility: provides power during shortages and stops disruptive events from spreading in the grid. Creates an efficient market: increases the utilisation of existing assets and enhances the ROI of energy supply companies.
Applications and technology

Energy storage technologies provide a wide spectrum of capabilities that perform a number of applications. We have grouped the capabilities broadly into three categories. Renewable energy management and power conditioning for the grid. Automotive ultimate zero-emissions goal. Mobility for consumer electronics products. Although electricity is difficult to store directly, it can be easily stored in other forms and converted back into electricity when necessary. Energy storage systems in commercial use today can be broadly categorised as: Electro-chemical (lithium, nickel, lead-acid, sodium sulphur, metal-air, flow batteries, etc.). Electrical (capacitor). Hydrogen (fuel-cell). Mechanical (flywheel), thermal (molten salt). Fluid storage (pumped-hydro and compressed air). Electro-magnetic (super-conducting magnets).
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February 2012
How much does it cost?

The benefits of energy storage mentioned above come at a price. If devices can be charged and discharged for a long period of time, the fixed cost for storing energy drops. In practice, however, after 10-12 years, most of those storage devices are upgraded with new-generation devices. Apart from cost, other critical parameters to monitor are energy density, power density, volume and safety. The importance of these parameters will vary with end applications. Although the levelised energy storage cost of a flow battery is lower than that of a lithium-ion (Li-ion) battery, the flow battery cannot be used in an electric vehicle.
Levelised energy storage costs (2011)

NiMH Lead-acid Lithium-Sulfur Lithium-Air Li-ion Metal-Air Sodium-Sulfur Hydropower Flow batteries CAES Ultracapacitor Flywheel 0.0 1.0 2.0 3.0 4.0 5.0 6.0 LESC (US$/kWh) 7.0
Source: Daiwa estimates LESC= Unit capital investment /(conversion efficiency x cycles) For total cost, please add per KWh energy cost of that location.
All new technology promises to reduce costs in the long term. However, battery technology (the mainstream of energy-storage technology) relies on chemical properties, and rapid energy density enhancement is not possible compared with other technologies/products in the electronics industry (see the following chart). Therefore, we expect the battery industry to remain material-intensive in the foreseeable future.
Technology progress: comparison with IT industry

10,000
Performance
1,000
100
10
1 1990 Disk capacity

Source: Daiwa
1992 CPU speed
1994
1996 Battery energy density
1998 RAM available
2000
2002
Wireless transfer speed
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February 2012
Important physical parameters for various applications

Important parameters for storage technology: storage capacity versus discharge times
Typical discharge timescale
Flow Batteries
Hours
Metal-Air NaS
Hydrogen Li-ion NiCd Lead-Acid
Minutes
Flywheel Fuelcell
Seconds
Ultracap 1kW 10kW 100kW 1MW
SMES 10MW 100MW
Storage capacity
Source: EIA
Important parameters for mobile devices: smaller and lighter devices are key
Gravimetric Energy Density (Wh/kg) 1,200 1,100 1,000 900 800 700 600 500 400 300 200 100
NiCd
Lighter
Fuelcell
Flywheel
Li-S
NiCd
LeadAcid
Redox flow NaS

NiMH
Li-ion
Smaller
0 0
Source: ESA, Battery University, Daiwa
Fuel cell 200 400 600

Voumetric Energy Density (Wh/l)
800
1000
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February 2012
Why energy storage is important

Renewable energy
The rising contribution from renewable, clean-energy sources to the grid increases the degree of supply variability and uncertainty, as shown below. Electricity operators are looking at ways to improve power quality by adding fast charging and discharging energy storage solutions to the grid, such as ultracapacitors, batteries, flywheels, etc. Second, more than 20% of the electricity generated at various times of the day (peak-power generation) is being wasted. For efficient use and to lower carbon footprints, storing such energy for future use (energy management applications) will be another challenge. Without having a cost-effective solution to these issues, the future of renewable energy will be bleak, with renewable energy remaining a niche market. For instance, the EU aims for 20% of its energy sources to be renewable by 2020, China targets 15%, the US <15% and Japan >20% by then. For energy-storage system (ESS) applications, we think cost, safety and ease of upgradability will be the key drivers for next-generation storage technology. Size and weight should be the least considerations. The key buyers of such ESSs are corporate or government entities, so policy is playing a key role in implementing such solutions in the current early phase of development.
Electricity consumption mix (2010)

Oil 5.0% Nuc lear 13.0% Coal 41.0% Wind Other s 2.0% 2.0%
Electricity consumption mix (2020)

Biomass c ombustion 4.0% Other s 5.0%
Solar 9.0%
Nuclear 45.0% Small hydro 9.0%
Hydr o 16.0%
Unconventional gas 12.0% Wind 16.0%
Gas 21.0%
Source: BP
Source: Daiwa
Energy generation: load balancing becomes complex with renewable energy

Not renewable
(MW) 50,000
35% renewable
Wind Hydro
(MW) 50,000
Solar PV Hydro
Gas Turbine
40,000
40,000
30,000
Combined Cycle
30,000
Wind Wind
20,000
20,000
Steam coal
10,000
10,000
Steam coal
Nuclear
0 Day 1 Day 2 Day 3 Day 4 Day 5 Day 6 Day 7
0 Day 1 Day 2 Day 3
Nuclear
Day 4 Day 5 Day 6 Day 7
Source: Sandia National Laboratories, Daiwa
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February 2012
Energy value chain
Waste energy can be reduced with energy storage systems
Source: Lawrence Livermore National Lab, Daiwa
Peak-saving and load levelling
Load curve Energy supply Energy supply
Energy storage
Night Tim e
0
Source: Daiwa
10 Day 1
15
20
25 Hours of the day
30
35
Day 2
40
45
50
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February 2012
Automotive industry
Countries worldwide are aiming to lower their carbon dioxide (CO2) footprints and reduce their dependence on fossil fuels, which are mainly available in only a few geographical locations. The transportation industry alone consumes 60% of global oil production a year. We forecast this to increase to 80% by 2020 if fuel consumption per km of travel is not cut substantially. Hybrid electric vehicles (HEV), plug-in hybrid electric vehicles (PHEV), and electric vehicles (EVs) are the key drivers of a reduction in the dependence on fossil fuels. The auto industry is targeting to move to zero-emission cars, for which EVs are the proposed solution. For automotive applications, performance, safety, cost and weight are the key considerations in selecting a battery. The key buyers of automotive products are consumers, and therefore the cost and convenience of using an EV over operating a traditional vehicle will be the key considerations in adopting such solutions. The most popular HEV is Toyotas Prius which uses a nickel metal hydride (Ni-MH) battery. All the other major EVs and hybrids that have been launched and are planned to be launched in the next two years use Li-ion batteries. Ultracapacitors are only used for a few city-bus routes where vehicles can be charged after every 2-3km. There has been a notable improvement in the performance and cost reductions of HEVs and EVs over the past five years. However, the fuel consumption and cost of traditional gas cars have also declined over the same time frame. Therefore, it has been becoming more difficult for the mass market to switch to HEVs/EVs. In our view, a push by governments (such as cash/tax incentives and infrastructure development) is necessary to kick-start this industry.
CO emissions (well-to-wheel)
100%
80%
60%
40%
20%
0% Gasoline cars
Source: IEA, Daiwa
Diesel cars
HEVs
FCVs
EVs
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February 2012
EV market: technology and product roadmap for EVs (global), 2005-15

Driving distance/charge-up to 55 miles 125miles <1hr 50kWh 70-250kW >190miles <15mins >75kWh
Performance
Charge time 6-8hrs Battery capacity 16kWh Motor power 70kW
Infrastructure
Slow charging - onboard Fast charging mostly off-board Battery swapping
Market for extended range of EVs: technology roadmap for PHEVs

Electric range Battery capacity Motor power Charging time
40miles 100miles
7-15kWh
16-25kWh
50-70kWh
70-140kW
2-6hrs
15mins 2hrs
2005
Source: F&S, Daiwa
2010
2015
2020
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February 2012
Comparison of car/bus performances with battery and ultracapacitors
Source: Daiwa Note: Calculation based on assumption of sedans running at 70km/day over 365 days.
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February 2012
Consumer electronics products

Portability and safety are the two key factors in determining the batteries to be used in consumer electronics products. As such, Li-ion batteries, which have one of the highest energy densities among all battery technologies, have taken the majority market share for all key applications. This industry is mature, and therefore demand is predictable compared with that for other applications. Going forward, smartphones and tablet PCs, which were initially spearheaded by Apples iPhone and iPad, will likely be the key growth drivers for this segment, which predominantly uses lithium polymer batteries rather than typical Li-ion batteries. Lithium polymer cells are thin (26mm thick) and custom-shaped, but more expensive than canned Li-ion batteries. Nickel metal hydride (Ni-MH) batteries are the most common type of batteries used in cordless phones currently, having replaced nickelcadmium (Ni-Cd) batteries. There have been developments in micro-fuel cells for consumer-electronics products, and recently Apple has filed patents for such technology. A micro-fuel cell can run a mobile phone for weeks on a single charge.
Smartphone users complaints mostly relate to short battery life, 2011

(%) 70 60 50 40 30 20 10 0 62.7
Are micro-fuel cells, which are among the worlds smallest, a solution?
23.8
29.8 18.4 10.2 5.2 2.5
Slow speed
Small screen
Source: Duriansoft
Typical battery sizes

Smartphone Tablet PC Notebook UPS HEV EV Base station Grid
Typical size Technology

Source: Daiwa
3-5Wh LiP
20-30Wh LiP
40-50Wh LiB
1-20KWH Lead-acid
Complex ity
Battery life
Instability
Call quality
Weak security
3-8KWh Ni-Mh/Li-ion
15-30KWh LiB
8-30KWh Lead-acid
2-36MWh LiB/NaS
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February 2012
2. Energy storage lithium-ion batteries

Overview
Lithium-ion batteries (LiB) utilise lithium, the lightest metal with the greatest electrochemical potential. The reactive trait of lithium allows for very high energy- and power-density potential in automotive and uninterrupted power supply (UPS) applications. A typical LiB cell uses layers of graphitic carbon as an anode material, and lithiated metal oxide as a cathode material. The electrolyte is a blend of lithium salt in an organic carbonates solution. When a battery is being charged, lithium ions move out of the cathode into the electrolyte solution and flow freely onto the negative electrode. The lithium ions combine with external electrons at the anode and are deposited between the carbon layers as lithium atoms. The process is reversed during discharge. There are many species in the LiB family, with the type of LiB conventionally grouped according to its cathode materials. These include lithium cobalt (LCO), lithium manganese (LMO), lithium iron phosphate (LFP), lithium nickel managanese cobalt oxide (NMC), lithium nickel cobalt aluminium oxide (NCA), lithium titnate (LTO), and all other newly developed materials. Most of the consumer electronics market today is dominated by LiBs, which have replaced lead acid and NiMH batteries. Yet, the hurdles are high for large-scale battery application due to the increased cost, stringent thermal management, and safety protection design, etc. The use of alternative chemicals and volume production are in progress to bring costs down.
Markets
Top-5 manufacturers in Asia (2011)
Sanyo/Panasonic Samsung SDI LG Chem Sony Lishen
Source: IIT
Cells (m) 1,034 1,002 759 495 319
Market share (2011)

Sanyo/Panasonic Samsung SDI LG Chem Sony Lishen
Source: IIT
(%) 22.9 22.2 16.8 11.0 7.1
LiB market size

(US$m) 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 1995
Source: Battery University
Cost breakdown (2011)

Others 15.0% Copper foil 3.0% Can 3.0% Cathode materials 36.0%
Separator 19.0% Anode materials 11.0%
Electrolytes 13.0%
2000
2005
2010
Source: Korea Electronics Association (KEA)
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February 2012
2011 numbers
0.2531.222 500-550
Commercialised
Levelised energy storage cost (US$/kWh) Capital cost (US$/kWh) Stage of development Energy efficiency (%)
Technological developments
A LiB cell contains a cathode, anode, electrolyte, separator, outer shell and electrode wire. The structure has two main types, wind and nappe. A LiB adopts the wind structure while a LiP has both. The wind type is structured with cathode, separator, and anode film slice in order and typically used for both Source: Nissan cylindrical and prismatic cells. In contrast, the Nappe type combines the cathode, separator, anode, separator, cathode layers together and welds all the cathodes and anode together as two downlead windows. The charging algorithm basically resembles that between Li-ion and Li-ion polymer cells.
90-99
Source: Daiwa estimates
Note: Energy efficiency is a measure of the power load coming out of the energy device divided by the power load going into the energy device.
Pros & cons

Pros
High specific energy Long cycle life Good safety record Low/minimal maintenance Relatively low self-discharge
Source: Daiwa
Cons
Requires a protection circuit to limit the voltage and current Storage capacity may run down even if not in use Transportation restrictions on larger quantities
Daiwas industry outlook

(US$bn) 60 50 40 30 20 10 0 2005
Source: Daiwa forecasts
Next 5-10 years

60.8 13% CAGR
24% CAGR 6% CAGR 8.5 11.1
32.6
With variations in the chemicals used, these batteries can be used for almost all types of storage applications. This is the dominant technology in mobile devices and EVs, and has considerable potential for grid powerconditioning. We forecast the Li-ion battery market to increase 5.5x between 2010 and 2020 and remain the mainstream technology over the next 5-10 years.
2010
2015E
2020E
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February 2012
Energy storage ultracapacitors

Overview
Ultracapacitors (also known as supercapacitors or electric double-layer capacitors [EDLC]) store electricity physically by polarising an electrolytic solution to store energy electro-statically. Although it is an electrochemical device, it combines the properties of a capacitor and battery in a storage mechanism. This mechanism is highly reversible, and allows the ultracapacitor to be charged and discharged hundreds of thousands of times. Ultracapacitors are very efficient in capturing electricity from regenerative braking, and deliver power that enables rapid acceleration in vehicles. They also have a longer service lifespan than that of most cars. The amount of energy stored is very large compared with a standard capacitor because of the enormous surface area created by the porous carbon electrodes and the small charge separation (10 angstroms) created by the dielectric separator. However, an ultracapacitor stores a much smaller amount of energy than a battery. Since the rates of charge and discharge are determined solely by its physical properties, ultracapacitors release energy much faster (with more power) than a battery, which relies on slow chemical reactions.
Markets
Top-5 manufacturers (2011)
Maxwell Technologies Nippon Chemi-Con Nesscap Energy Panasonic Electronic Devices batScap
Source: Companies, Daiwa
Revenue (US$m) 114.8 (3CQ11) 1,395.3 13.2 (3CQ11) 100,543.7 n.a.
Common applications
HEVs Military/Aerospace Stationary power/grid
Source: Daiwa
Ultracapacitors: annual market size

(US$m) 500 450 400 350 300 250 200 150 100 50 0 2008 2009 2010
Source: BCC Research, iRAP, NanoMarkets, Daiwa
Cell structure
470
335 285
Source: Department of Energy (DoE)
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February 2012
2011 numbers
0.010.06 2651320
Emerging Levelised energy storage cost (US$/kWh) Capital cost (US$/kWh)
Two metal plates coated with a sponge-like and porous activated carbon, namely positive and negative electrodes, are immersed in an electrolyte solution. During charging, ions from the electrolyte collect on the surface of each carbon-coated plate, the applied potential on the positive electrode attracts the negative ions in the electrolyte, while the potential on the negative electrode attracts the positive ions. A dielectric separator between the two electrodes keeps the charge from moving between the two electrodes. Once the ultracapacitor is charged and energy stored, a load (the vehicles motor) can use this energy.
Stage of development Energy efficiency (%)
85-98
Source: Daiwa
Pros & cons

Pros
Unlimited cycle life High specific power; low resistance enables high load currents Rapid and simple charging; no end-of-charge termination required Excellent low-temperature charge and discharge performance
Source: Maxwell, Daiwa
Cons
Low specific energy; holds a fraction of a regular battery Linear discharge voltage prevents using the full energy spectrum Higher self-discharge than most batteries Low cell voltage; requires serial connections with voltage balancing High capital cost per watt

(US$bn) 5 4 5.0
Next 5-10 years

Ultracapacitors are used currently mainly for city buses that use predictable routes or capture regenerative energy from brakes. Due to its fast charge-discharge capability (power density), we expect ultracapacitor use to rise along with batteries for future EV and ESS applications. New materials are being developed that should lead to the energy density of ultracapacitors increasing.
33% CAGR
3 2
21% CAGR 14% CAGR

1.2 0.5
1 0
0.2 2005
2010
2015E
2020E
We forecast the ultracapacitor market to expand tenfold, from US$0.5bn in 2010 to US$5.0bn by 2020.
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February 2012
Energy storage fuel cells

Overview
Fuel cells are favoured for their low emissions, quiet operation, no moving parts and high potential fuel efficiency far beyond the most advanced reciprocating engine or gas turbine power generation systems. They are fed by fuels such as hydrogen and oxygen that are readily available, and thus reduce the reliance on oil and the aging electric grid. Power generation can continue as long as flows of fuel and hydrogen/oxygen are supplied into the reactor, and water is produced as a by-product. Although it is a relatively nascent industry, fuel cells have shown vigorous growth in the past few years. Fuel cells generate power electrochemically from hydrogen delivered to the negative pole (anode) of the cell and oxygen delivered to the positive pole (cathode). The most economical source of hydrogen comes from the natural gas or liquid fuel reforming. There exist four common forms of electrochemical reactions currently, namely phosphoric acid (PAFC), molten carbonate (MCFC), solid oxide (SOFC), and proton exchange membrane (PEM). PAFCs are the most widely deployed fuel cells system, with increasing entrants seen in PEM fuel cells. SOFC and MCFC technologies have yet to be commercialised.
Markets
FuelCell Energy Ballard Power Hydrogenics Corp Plug Power SFC Energy
Source: EERE, Daiwa
Revenue (US$m) 69.8 65.0 20.9 19.5 17.7
Top-5 patents by region (2010)

US Japan Germany Korea Canada
Source: EERE
2010 47 31 7 5 3
Top-10 countries private investment in fuel cells from 2000-10 (US$m)

900 800 700 600 500 400 300 200 100 0 774.4
Global fuel cell light vehicle sales (units)

(units) 450,000 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 2015E 93%
100% 80% 45% 31% 33% 39% 60% 40% 20% 0%
297.3 153.3 98.3 57.1 50.0
46.5
28.8
27.7
26.5
U.S
U.K
Switzerland
South Africa
Germany
Singapore
Australia
Netherlands
Sweden
Canada
2016E
2017E
2018E
2019E
2020E
FCV Sales (LHS)
YoY Growth (RHS)
Source: EERE/New Energy Finance
Source: Pike Research, Fuel Cell and Hydrogen Energy Association, Daiwa
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February 2012
2011 numbers
n.a 3,0007,500
Emerging Levelised energy storage cost (US$/kWh) Capital cost (US$/kWh)
Each fuel cell system is composed of three key subsystems: 1) a fuel cell stack, which generates a direct current of electricity, 2) a fuel processor, which converts the natural gas into a hydrogen-rich feed stream, and 3) a power conditioner, which processes the electric energy into alternating current or regulated direct current. In operation, hydrogen and oxygen are passed over anode and cathode accordingly, causing hydrogen ions and electrons to form at anode. Electrons flow through an external circuit to produce electricity while hydrogen ions pass onto cathode. Hydrogen ions combine with oxygen to produce water.
25-70
Source:Ballard Power Systems
Pros & cons

Pros
Simpler design and energy-dense High power and electrical efficiency Low maintenance Adjustable nominal power Large output Long life span Low pollution Low noise volume Heat waste recycling capability Internal consolidation capability
Source: Daiwa
Cons
Feed gas and oxidiser constraints Relatively higher cost Long response time Humidification required for some reactants PEMFC and PAFC are sensitive to CO2 Still early stage of development

(US$bn) 7 6 5 4 3 2 1 (1) 2005
6.2
Next 5-10 years

Mostly in the developmental stage. We expect commercial use of fuel cells to come from consumer electronics (micro-fuel cells) and automotive applications. Further technology development is necessary to use a cheaper catalyst instead of platinum, and also to operate at low temperature.
25% CAGR 25% CAGR

0.7 2.1
25% CAGR
0.2
2010
2015E
2020E
We expect a nine-fold increase in the fuel cell market between 2010 and 2020.
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February 2012
Energy storage lithium-air batteries

Overview
Lithium-air, also known as lithium-oxygen, batteries are similar in principle to lithium-ion batteries, but potentially offer a theoretical 1,000 times greater energy density and more than 10 times maximum storage capacity, greater than that for a prototypical LiB. A lithium-air batter is much smaller and lighter in size, as it replaces the heavy conventional metal oxide compounds with carbon-based air electrodes, which react with oxygen to create an electrical charge. R&D of Li-air technology started a decade ago at IBM. Recent research conducted at the Massachusetts Institute of Technology (MIT) substituted gold and platinum for the standard carbon electrodes in Li-air cells as catalysts, and was able to obtain much higher efficiencies; however, the increase in capacity also significantly raises the cost of the battery. In addition, this new battery system could raise safety concerns as Li-air batteries are filled with air and the flammable metallic lithium is highly reactive in the presence of even a minuscule amount of water, potentially causing the battery to explode. The development of the system is to maintain power with sufficient charging and discharging cycles before commercialising the system for EV or CE applications.
Markets
Top developers (2011)
IBM General Motors (Full commercial production to commence in 2020) (R&D stage, commercial production in 5-20 years) Goal Battery 500 (Almaden Institute, funded by 500mi/800km range per IBM) charge Carbon fibre-based electrode Li-air (MIT) High porosity gas diffusion electrode Li-air 5-10x LiB energy density (Argonne National Laboratory, funded by internal aid programme)
Source: Argonne National Laboratory, MIT, IBM, Daiwa
Projects under development
Development milestones
Structure
Source: Daiwa
Source: Department of Energy (DoE)
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February 2012
2011 numbers
0.2862.857 70-100 R&D <70
Li-air batteries are air-breathing. During discharge, lithium ions flow from the anode through an electrolyte and react with oxygen at the cathode to form lithium peroxide on a carbon matrix. Upon recharge, lithium oxides separate again into lithium and oxygen. Oxygen is then released back to the atmosphere and lithium flows back onto the anode. The superior energy density of Li-air batteries is due to a higher porosity that can store lithium oxide as the battery discharges.
Source: MIT
Pros & cons

Pros
Significantly higher potential energy density and capacity Reduced size and weight ideal for range of EVs Higher efficiency 5x longer lifespan versus LiBs
Source: Daiwa
Cons
Highly unstable Higher cost Can be extremely explosive Limited numbers of charge and discharge cycles

Next 5-10 years
Further development of next-generation lithium technology for high-density energy storage for mobile applications. Unlikely to be commercialised in the next 3-5 years.
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February 2012
Energy storage lead-acid batteries

Overview
Lead acid batteries have the longest commercialisation history amongst all types of existing rechargeable batteries, and are currently the most widely used electrochemical system used in mobility and stationary applications. Lead acid charging uses a voltage-based algorithm similar to lithium-ion and is composed of several sub-technologies by different manufacturing process. Major designs include: 1) flooded lead-acid batteries, 2) valve-regulated lead-acid (VRLA) batteries with the electrolyte immobilised by a gel, and 3) VRLA batteries with the electrolyte immobilised in an absorptive glass mat (AGM). A lead acid battery is composed of a lead-dioxide cathode, a spongy/ porous lead anode, and a sulphuric acid solution electrolyte. The lead is porous to facilitate the formation and dissolution of lead. During charging, the lead sulphate and water are electro-chemically converted to lead, lead oxide and sulphuric acid by an external electrical charging source. On discharge, the lead dioxide (positive plate) and lead (negative plate) react with the electrolyte of sulphuric acid to create lead sulphate, water and energy. The electrode reactions of the cells are unusual in a lead acid battery in that the electrolyte (sulphuric acid) is also one of the reactants. Lead acid batteries should be charged in three stages, which are: 1) constant-current charge, 2) topping charge and 3) float charge. The constant-current charge applies the bulk of the charge and takes up roughly half of the required charge time; the topping charge continues at a lower charge current and provides saturation; and the float charge compensates for the loss caused by self-discharge. The charge time of a sealed lead acid battery ranges from 12-16 hours (fast charge) up to 36-48 hours for large stationary batteries. With higher charge currents and multi-stage charge methods, the charge time can be reduced to less than 10 hours. However, the saturation may not be complete and it cannot be charged as quickly as other battery systems.
Markets
Market share of top-5 manufacturers (2010)
Johnson Controls Exide Technologies GS Yuasa Enersys East Penn
Source: ITRI IEK (May 2011), Daiwa
(%)
Global lead demand by application (2010)

Lead-acid batteries Pigment Flat-rolled Others Lead-acid batteries
Source: Daiwa
(%)
26 8 7 4 3
80 6 5 9 80
China lead-acid battery market

(kVAh m) 250 200 150 100 50 0 13.6 24.9 15.6 2005 19.6 33.7 25.9 2006 26.2 40.3 37.2 2007 Motive 30.9 44.6 45.9 2008 SLI 40.4 49.7 52.2 58.4 61.6 54.9 46.6 68.8 88.3 81.3 65.5
Lead-acid battery market by application

Other vehicles 6.0% Motorcycle starter batteries 6.0% E-bikes 9.0% Transport vehicles (incl forklifts) 9.0% Other applications 8.0%
Automotive starter batteries 52.0%
73.5 2011E
2009 2010 Reserve Power
2012E
UPSs (incl base stations) 10.0%
Source: Asia Battery Association
Source: Source: ITRI IEK (May 2011), Daiwa
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February 2012
2011 numbers
1.575.76 200-300
Commercialised
A cell consists of a positive lead dioxide-covered plate and a negative spongy lead, with a separator in between. The plates are submersed in an electrolyte consisting of water and sulphuric acid. Charging converts the lead sulphate at the negative electrode to lead and lead to lead oxide at the positive terminal, and hydrogen is evolved as a by-product. Discharging a battery causes lead sulphate crystals to form at both negative and positive terminals as the electrolyte loses sulphuric acid. Electrons are released due to the change in valence charge of the lead.
Source: Leoch
85-90
Pros & cons

Pros
Low cost per watt-hour Lowest self-discharge among rechargeable batteries High specific power; high discharge currents Good low and high temperature performance
Source: Daiwa
Cons
Lead is toxic Low specific energy; poor weight-to-energy ratio Limited cycle life Slow charge takes up to 14hrs Transportation restrictions on the flooded type

Global lead-acid, Ni-MH, NiCd market
(US$bn) 40 35 30 25 20 15 10 5 0 2005
Next 5-10 years

Advanced lead-acid batteries, which are in the development phase, may be used for smart grids or even EVs.
30.4 24.7 20.0
-6% CAGR
17.1
Traditional lead-acid batteries are mostly used for automotive applications followed by power supply for UPS. The potential for further cost reductions is limited. The near-term outlook is strong due to rising demand for UPS, and we estimate the market will peak by 2015.
2010
2015E
2020E
- 19 -

February 2012
Energy storage nickel-metal hydride batteries

Overview
Nickel metal hydride (Ni-MH) batteries, along with Nickel-cadmium (NiCd) batteries, are amongst the hardest batteries to charge. The nickel-based batteries dont have a float charge voltage that the charging is based on, forcing current through the battery. The components of NiMH batteries include a cathode of nickel hydroxide, an anode of hydrogen-absorbing alloys, and a potassium hydroxide electrolyte, which are collectively more benign than the active chemicals used in LiBs. The idea of a nickel-metal hydride cell negative electrode emanated from hydrogen storage research for use as an alternative energy source initially. Certain metallic alloys were observed to form hydrides that could capture and release hydrogen in volumes up to 1,000 times their own volume. Carefully selecting the alloy constituents and proportions encourages balanced thermodynamics that allow the absorption and release process to proceed at room temperature and pressure. NiMH battery technology has begun to mature and is now used in high-voltage automotive applications in addition to high-end consumer electronics. Like NiCd batteries, NiMH batteries are susceptible to a memory effect though to a lesser extent. They are more expensive than lead acid and NiCd batteries, but are considered more environmentally friendly.
Markets
Major manufacturers (2010)
Sanyo/Panasonic GS Yuasa Saft Energizer GP ReCyko
Source: Daiwa
Revenue (US$m) 101,154 3,106 784 4,249 624
Major applications
Emergency lighting/CEs Railways Backup systems Power tools Electric Vehicles
Source: Daiwa
Global NiMH battery demand

(US$m) 1,000 900 800 700 600 500 400 300 200 100 0 1995
Cell structure
2000
2005
2010
- 20 -

February 2012
2011 numbers
2.756.67 1,1004,000
Commercialised
Levelised energy storage cost (US$/kWh) Capital cost (US$/kWh)
A NiMH battery is an alkaline storage battery due to the use of potassium hydroxide (KOH) as an electrolyte, and is similar to a NiCd battery electrically. Its positive electrode material is nickel hydroxide and its negative electrode material is hydrogen. The nickel electrode can be made with large surface areas, which allows high capacities and high current densities. It is also insoluble in the KOH, which leads to a long battery life and better abuse tolerance. The electrolyte does not enter the electrode reaction so the conductivity stays high throughout the usable capacity. At the negative electrode, hydrogen ions are stored in the metal hydride structure, and metal hydride is very efficient, achieving good volumetric efficiency.
Source: Toyota Prius
20-120
Pros & cons

Pros
Higher specific energy with mild toxins Simple storage and transportation Higher capacity than NiCd Less prone to memory than NiCd Nickel content makes recycling profitable
Source: Daiwa
Cons
Limited service life Requires a complex charge algorithm Heat generation during fast-charge and high-load discharge High self-discharge Performance degradation if stored at elevated temperatures

NiMH HEV market forecasts
(Units) 1,400 1,200 1,000 800 600 400 200 0 2007 2008 2009 2010 2011E 2012E 2013E 2014E 2015E 2020E
Next 5-10 years

Has been a popular battery choice for consumer electronics devices, but is losing market share to Li-ion batteries. Use in hybrid cars should keep the product alive for the next 10 years. We think the NiMH battery market peaked in 2007.
- 21 -

February 2012
Energy storage lithium-sulphur batteries

Overview
Lithium-based batteries are safer than lithium-ion batteries and can achieve 80% more capacity. This nextgeneration rechargeable power supports large-scale applications, such as unmanned vehicle systems, military communications and electric vehicles. The manufacturing of lithium-sulphur (Li-S) cells largely resembles that of lithium-ion liquid or lithium-ion polymer cells. The anode and cathode of Li-STM cells are thin materials, substantially similar in thickness and tensile strength to those of lithium-ion. Standard lithium-ion winders can be used with little to no modifications. Prismatic and cylindrical form factors can be produced from the same anode and cathode raw materials. However, this new type of energy storage device is still in the R&D phase and only supports 40-50 charge cycles, much lower than conventional LiBs 300-500 charges due to a rapid degradation of the lithium air/lithium sulphur compounds. Materials-making is also a challenge as sulphur is an insulating material and it is therefore difficult for electrons and ions to move in and out. Although each sulphur atom may theoretically be able to host two lithium ions, often only sulphur atoms near the surface of the material accept lithium ions. Another shortcoming appears in that when sulphur binds to lithium ions and forms dilithium sulphide, it also creates an intermediate product called polysulfides. Polysulfides dissolve in the liquid electrolyte and eventually settle in other areas of the battery where they can potentially block charging and discharging. As a result, the battery can stop working after only a few dozen cycles. Meanwhile, the lithium metal electrode presents potential safety problems, as the lithium electrode can grow branchlike structures that increase the impedance of the cell, causing it to heat up during use. These structures can cause a short circuit and the metal can melt. If the molten lithium leaks out and associates with water, the battery can catch fire.
Markets
Major manufacturers (2010)
BASF (Sion Power) Saft Intellikraft Poly Plus Battery
Revenue (US$bn) 84.3 0.78 n.a n.a
Major R&D projects

Penn State (funded by DoE) Sion Power (funded by DoE)
Subsidy (US$m) 5.0 50.0
Source: DoE, Daiwa
Structure
Source: Daiwa
Source: Stanford University
- 22 -

February 2012
2011 numbers
0.7843.529 100-150 R&D ~85
A LiS battery comprises one electrode of lithium and another of sulphur that typically pair with carbon. Similar to lithium-ion, charging and discharging involves the movement of lithium ions between the two electrodes. The theoretical capacity of a LiS battery is higher than that of a LiB battery as more ions can be assimilated at the electrodes. At the sulphur electrode, each sulphur atom can host two lithium ions when compared to only 0.5-0.7 lithium ions which can be accommodated for every host atom in a LiB.
Source: Saft
Pros & cons

Pros
50% greater specific energy (>350 Wh/kg current, >600Wh/kg potential) than LiBs Cost-effective on a material content cost and yield basis Similar manufacturing techniques as other major cell chemistries
Source: Daiwa
Cons
Short cycle life Pure sodium requires system protection from moisture Polysulfides can impact charging and discharging performance

Next 5-10 years
A potential candidate for next-generation lithium-cell technology. At the development stage. We see a limited possibility of commercialisation in the next 3-5 years.
- 23 -

February 2012
Energy storage sodium-sulphur batteries

Overview
Sodium-sulphur (NaS) batteries are high capacity energy storage systems designed for electric power applications and backup power supplies. A NaS battery consists of liquid sulphur at the positive electrode and liquid sodium at the negative electrode as active materials, separated by a solid beta alumina ceramic electrolyte. The electrolyte allows positive sodium ions to slip through and combine with sulphur to form sodium polysulfides. During discharge, positive sodium ions flow through the electrolyte, and electrons flow in the external circuit of the battery. The process is reversible as charging causes sodium polysulfides to release positive sodium ions back through the electrolyte to recombine as elemental sodium. In order to keep sodium and sulphur molten and retain the conductivity in electrolyte, they are thermally insulated to maintain at 270-340C. At high temperature, both active materials react rapidly and internal resistance is low, and thus the NaS battery performs well. By reversible charging and discharging, the NaS battery can be used continuously. NaS cells are efficient (~89%) and have a pulse power capability over 6 times their continuous rating, which enables the NaS battery to be economically used in combined power quality and peak shaving applications.
Markets
Top manufacturers (2011)
NGK Insulators Posco General Electric
Source: Companies, Bloomberg
Revenue (US$m) 2,829.4 52,465.0 149,060.0
Common applications
Advanced stationary (power grids) Electric vehicles
Source: Sandi National Laboratories, Daiwa
Structure
Source: Daiwa
Source: NGK Insulators
- 24 -

February 2012
2011 numbers
0.1280.293 520-550
Commercialised
Multiple cells are installed in a single, heated and vacuum insulated module. Electric power is discharged when a load is connected to terminals. On discharge, sodium ions converted from sodium in a negative electrode pass through a solid electrolyte then reach the sulphur in the positive electrode. The electrons finally flow to outside circuits and electricity is generated. During discharge, sodium polysulfide is formed in the positive electrode, and sodium in the negative electrode will decrease by consumption. On charging, electricity supplied from outside forms sodium in the negative electrode and sulphur in the positive electrode by reversing the process of the discharge. As a result, the energy is stored in the battery.
75-90
Source: Honda
Pros & cons

Pros
Higher energy density and specific energy Higher charge/discharge efficiency Longer cycle life with low self-discharge rate Lowest cost; sodium and sulphur are relatively abundant No pollution gas, vibration, and low noise
Source: Daiwa
Cons
Pure sodium requires system protection from moisture High temperature required for operation Fire hazard

Next 5-10 years
A strong candidate for grid energy storage, and has great potential. Raw materials are in abundance. A few incidents of the batteries causing fires have occurred in recent months, which have put many grid energystorage projects with NaS batteries on hold. This could lead to grid operators favouring other technologies in the near term.
- 25 -

February 2012
Energy storage metal-air batteries

Overview
Metal-air batteries are currently at basic research stages. These are highly compact systems and are limited to small-scale application. Amongst the metal-air family, Zinc and Lithium are the most advanced anodes commonly available with a high energy density that release electrons upon oxidation. The cathodes or air electrodes are often made of a porous carbon structure or a metal mesh covered with proper catalysts. The electrolyte of the cell is often in liquid form or a solid polymer membrane structure with a good OH-ion conductor, such as KOH. The metal-air batteries typically rely on water-based electrolytes. As water is an aqueous solution in the electrolyte and can evaporate and has a comparatively low electrochemical window, recent development has substituted water with ionic liquid, which is much more viscous and more electrochemically stable than water and helps overcome evaporation. However, this liquid salt at room temperature is relatively expensive compared to other solvents, as the supply is still limited. The high energy density and low cost of metal-air batteries may make them ideal for many primary battery applications; however, the electrical rechargeability feature of these batteries needs to be developed further before they can compete with other types of rechargeable battery technologies.
Markets
Major developers (2011)
AER Energy Resources Electric Fuel Alupower ChemTek Zoxy Energy Systems
Source: Daiwa
Projects under development

Zinc-Air Battery Bus Demo Program (FTA, CST, EFC, and RTC) Aluminum-air batteries (Lawrence Livermore National Laboratory)
Source: Daiwa
Cell structure
Source: Daiwa
Source: BatteryFacts
- 26 -

February 2012
2011 numbers
0.1100.880 110-420 Demo ~50
Metal-air batteries are electrochemical cells. Oxygen passes through porous cathode to produce hydroxyl ions in reaction with electrolyte. Ions are transferred to anode to oxidize zinc/aluminium. Electrons are thus released upon reaction. Inefficiency is seen in both recharging and discharging as metal precipitation control is required and liberation of oxygen from reversing reaction through cathode is as well limited.
Source: Bulgarian Academy of Sciences
Pros & cons

Pros
Environmentally benign Higher energy densities (~900-1600Wh/kg) Potentially least expensive type of battery Abundant and safe supply of material content
Source: Daiwa
Cons
Inefficient and difficult electrical recharging A few hundred cycles A relatively low 50% cycle energy efficiency (Charging voltage > discharge voltage)

Next 5-10 years
Metal-air batteries offer the next generation high-density energy storage for mobile applications. Micro-fuel cells are a key competing technology. Not suitable for ESS. In our view, these batteries are unlikely to be commercialised in the next 3-5 years.
- 27 -

February 2012
Energy storage flow batteries

Overview
Similar to conventional batteries and fuel cell methodologies, a flow battery is an electrochemical device that converts chemical energy into electrical energy. The technology differs from other conventional electrochemical batteries in the way the electro-active materials are stored externally in an electrolyte and are introduced into the device during operation. The systems in which electro-active materials are dissolved in a liquid electrolyte are called redox flow batteries (RFBs). Other true flow batteries might have a gas species (eg, hydrogen, chlorine) or liquid species (eg, bromine). Rechargeable fuel cells could also be considered as true flow batteries. There are three primary types of flow battery energy storage systems, namely Vanadium-redox (VR), polysulphide-bromide (PSB), and zinc-bromine (ZnBr) batteries. Systems in which one or more electro-active components are stored internally are called hybrid flow batteries, such as zinc-bromine and zinc-chlorine batteries. Most redox flow batteries consist of two electrolytes, one storing electro-active materials for negative electrode reactions and the other for positive electrode reactions. An ion selective membrane is placed in between the two half cells to prevent mixing or cross-over of the electro-active species which could result in chemical short-circuit of the electro-active materials. Only the common counter ion carrier is able to cross the membrane in order to complete the redox reaction.
Markets
General Electric ZBB Energy NGK Insulators Cellstram Prudent Energy (Vanadium RFBs)
Source: IHS
Capacity (MWh) 900 315 300 100 60
Common applications
Large stationary storage Electric Vehicles Military electronics UPS
Source: Daiwa
Major forms of flow batteries

System Redox All Vanadium Vanadium-Polyhalide Bromine-Polysulfide Iron-Chromium H-Br Hybrid Zinc-Bromine Zinc-Cerium Anode: Zn <> Zn + 2eCathode: Br + 2e- <> 2Br Anode: Zn <> Zn + 2eCathode: 2Ce + 2e- <> 2Ce 1.8V ZnBr/ZnBr 2.4V CHSOH (both sides) Reactions Anode: V <> V + eCathode: VO + e- <> VO Anode: V <> V + eCathode: Br + 2e- <> Br Anode: 2S <> S + 2eCathode: Br + 2e- <> 2Br Anode: Fe <> Fe + eCathode: Cr + e- <> Cr Anode: H <> 2H + 2eCathode: Br + 2e- <> 2Br Ecells Electrolyte Anode/Cathode 1.4V HSO/HSO 1.3V VCI-HCI/NaBr-HCI 1.5V NaS/NaBr 1.2V HCI/HCI 1.1V PEM*-HBr
Structure
Source: Electrochem, Daiwa
Source: Electropaedia
- 28 -

February 2012
2011 numbers
0.0340.228 290-740
Emerging Levelised energy storage cost (US$/kWh) Capital cost (US$/kWh) Stage of development Energy efficiency (%)
Modern flow batteries typically contain two electrolytes acting as liquid carriers, which are pumped simultaneously through two half cells of the reaction cell separated by a membrane. On charging, electricity supplied causes a chemical reduction in one electrolyte and oxidation in the other. The thin ion exchange membrane between the half cells keeps the electrolytes from mixing but allows certain ions to pass through to complete the redox reaction. During discharge, the chemical energy in the electrolyte is released in the reverse order, and electricity can be drawn from electrodes.
65-85
Source: Sumitomo Electric
Pros & cons

Pros
Optimal power acceptance and delivery properties More stable/durable performance of electrodes; longer lifetime Quick response time and low maintenance Tolerance to overcharge/overdischarge Deep discharge ability without affecting cycle life
Source: Daiwa
Cons
High cost systems and very few successful installations Complicated requirements of pumps, sensors, flow and power management systems, as well as secondary containment vessels; only more suitable for large-scale storage applications

Next 5-10 years
Flow batteries are suitable for large-scale storage for wind-firm or electricity grids. Vanadium batteries are currently the lead technology. There are few operational projects. We think commercialisation is possible in 3-5 years time.
- 29 -

February 2012
Energy storage flywheels

Overview
Flywheel energy storage works by accelerating a cylindrical assembly called a rotor (flywheel) to a very high speed (20,000rpm) and maintaining the energy in the system as rotational energy. During the charge, the flywheel is spun up by a motor with the input of electrical energy, while the same motor acts as a generator during discharge, producing electricity from the rotational energy of the flywheel. The flywheel system itself is a kinetic or mechanical battery, spinning at very high speeds to store energy that is instantly available when needed. Most products are capable of several hundred thousand full charge-discharge cycles and enjoy a much better cycle life than batteries. They are capable of very high cycle efficiencies of over 90%. Since the energy sizing of a flywheel system is dependent on the size and speed of the rotor, and the power rating is dependent on the motorgenerator, power and energy can be sized independently.
Markets
Top manufacturer (2010)
Beacon Power Revenue (US$m) 0.9
Major applications
Frequency regulation Power quality Emergency bridging power Fluctuation smoothing
Source: DoE
Source: Company
Key flywheel storage cost and performance assumptions

Commercial plant size (MW) Plant installed cost (US$/kW) Plant Availability Roundtrip Efficiency Variable cost (US$/kWh out) Fixed cost (US$/kW, year 1) Makeup Energy Price
Structure
20 1566 0.95 81% 3.14 11.6 40
Source: Sandia National Laboratories, 2010
Source: Nanyang Technological University
- 30 -

February 2012
2011 numbers
0.0080.024 200-500 Demo 80-90
Flywheels include a cylinder with a shaft that can spin rapidly within a robust enclosure. A magnet levitates the cylinder, thus limiting friction-related losses and wear. The shaft is connected to a motor/generator. Electric energy is converted by the motor/generator to kinetic energy. That kinetic energy is stored by increasing the flywheels rotational speed. The stored (kinetic) energy is converted back to electric energy via the motor/generator, slowing the flywheels rotational speed.
Source: Beacon Power
Pros & cons

Pros
2-3x more effective than fossil generators >100,000 life cycles (potentially infinite) Zero energy storage degradation No fuel consumed Operational under wide temperature range More environmental friendly Possible measurement of amount of energy stored
Source: Daiwa
Cons
Nascent technology Constraint on tensile strength of rotor materials (explosion risk) Energy loss for mechanical bearings (shorter energy storage time)

Flywheel EES size Total capital cost (US$ ) Annual O&M cost (US$) Cycle life Service life (years) Footprint (Sqft/MW)
Source: Daiwa
Next 5-10 years

1MW (0.25MWh) 0.75-2.0 20,000-30,000 100,000-2m 15-25 150
Conventional flywheel technology is well-established but not competitive, in our view. New-generation flywheels with magnetic bearings are in the development phase. Use of flywheels will be mainly for power-conditioning on the grid and to a lesser extent for long-term energy storage requirements (no leakage energy). The visibility on its future market size is low at this stage.
- 31 -

February 2012
Energy storage molten salt

Overview
Molten salt energy storage systems utilise a thermal-chemical technology, filling tanks of concentrating solar power (CSP) with molten salt, a non-flammable and toxic-free fluid which comprises 60% sodium nitrate and 40% potassium nitrate, or saltpetre. The mixture absorbs and retains heat at extremely high temperatures (up to 550C) without evaporating into steam. The stored heat is later released during low/no sun hours when hot salt is pumped into a steam-generator to produce superheated steam from water and runs turbines to generate electricity. The fluid is largely used in many chemical and metal industries as a heat-transport medium such as conventional coal, oil or nuclear power plant. Molten-salt batteries use highly conductive molten salts as an electrolyte, and offer high energy and power densities. The new battery uses sodium-containing substances melted at a high temperature. The technology has been around for decades, but existing molten-salt batteries require keeping the electrolyte in a liquid state at a temperature higher than 300C. Molten salt has a lower cycle life than lithium-ion and costs about US$300/kWh that poises the technology close to economic viability for utility-scale deployment. The ZEBRA battery is an example of a molten salt battery. Contrary to the energy storage system for solar power, a drawback for the general class of molten salt batteries has been high operating temperatures.
Markets
Common types of molten salts
Potassium nitrate Calcium nitrate Sodium nitrate Lithium nitrate
Top-5 molten salt storage projects, 2011

Cobra energy solar power plant (Australia) The Rice Solar Energy Project (United States) Crescent Dunes Solar Energy Project (United States) Alcazar's solar thermal project (Spain) Gemasolar Array (Spain)
Source: GreenDiary
Installation size (MW) 250 150 110 50 19.9
Source: Daiwa
Structure Development milestones
Source: Daiwa
Source: United Technologies/SolarReserve
- 32 -

February 2012
2011 numbers
n.a ~30
Commercialised
Tracking mirrors (heliostats) capture and solar thermal energy and concentrate it on a receiver on top of a tower. Within the receiver, sunlight heats molten salt to over 1,000F. The heated molten salt then flows into a thermal storage tank, maintaining 98% thermal efficiency, and eventually is pumped into a steam generator. The steam drives a standard turbine to generate electricity. This process, also known as the Rankine cycle, is similar to a standard coal-fired power plant, except fuelled by clean and free solar energy.
99
Source: Torresol Energy
Pros & cons

Pros
Operational at high temperature for large-scale storage Sodium is abundant and cheap Toxic-free and inflammable Inexpensive retrofits to conventional power plant assets A molten salt battery price is said to cost only 10% of a LiB battery Molten salt batteries have 2x the energy density of LiB batteries
Source: Daiwa
Cons
Underdeveloped technology Molten salt tanks must be kept at 80C to output power Strict control of heat-up speed required to avoid system heat shock

Concentrated solar power cumulative installation
(GW) 5 4 3 2 1 0 2010
Source: Daiwa
Next 5-10 years

Suitable only for large-scale energy storage, ie, to directly store solar heat and convert it to steam at night. Shows great promise in energy management in high sunbelt areas (eg, the desert).
32% CAGR
Only a few show-case projects so far.
2015E
2020E
- 33 -

February 2012
Energy storage hydropower

Overview
1) Storage projects impound water behind a dam, forming a reservoir. Water is released through turbinegenerators to produce electricity. The water storage and release cycles can be relatively short, storing water at night for peak-hour power generation; or, the cycles can be long, storing spring run-off for generation in the summer when power demand increases. Some projects operate on multi-year cycles carrying over water in a wet year to offset the effects of dry years. 2) Run-of-river projects typically use relatively low dams where the amount of water running through the powerhouse is dependent on the water flowing in the river. As these plants typically do not hold back water behind storage dams, they tend to affect upstream water levels and downstream stream flow less than storage projects. Electricity generation from these plants will be determined by changes in the amount of water flowing in the river. 3) Pumped-storage projects. Conventional pumped hydropower uses two vertically-separated water reservoirs. During off-peak demand, water is pumped from the lower reservoir to the higher reservoir where stored until needed. During peak or required hours, water in the higher reservoir is released through the turbines and these are connected to generators that produce electricity. High-dam hydro generating plants are common pumped hydropower while underground pumped storage using flooded mine cavities is also viable as the sea can be used as the lower reservoir. Pumped storage is the most widespread energy storage system in use on power networks. Main applications are for providing energy management, frequency control, and reserve capacity. Over 90GW of pumped-hydro storage, representing about 3% of global generation capacity, is currently installed worldwide.
Markets
Global installation capacity, 2010
Japan United States China Italy Spain
Source: Duke Unviersity
Market share (%) 24.5 21.3 15.2 7.3 5.2
Top-5 pumped-hydro installation projects, 2010

Bath County Pumped Storage (United States) Kannagawa Hydropower Plant (Japan) Guangdong Pumped Storage Power (China) Dniester Pumped Storage Power (Ukraine) Ludington Pumped Storage Power Plant (United States)
Source: Daiwa
GW 3.0 2.8 2.4 2.3 1.8
Pumped hydro energy storage system cost

Pumped hydro energy storage system cost (US$m) Access roads Tunnels Surge shafts Steel tunnel lining (1,000m) Surface pipes (500m) Power station Generators Turbines Pumps Transformers Allowance for others Project managemeng (100%) Total excl contingency Contingency (20%) Total estimated cost
2009 60 3,296 201 498 495 105 69 73 66 29 200 483 5,574 1,115 6,689
Structure
Source: ASCE Journal of Geotechnical and Geoenvironmental Engineering
Source: International Boundary and Water Commission
- 34 -

February 2012
2011 numbers
0.0070.470 1,5004,300 Mature 70-85
Pumped storage reservoirs are where water is pumped up to the top reservoir at night, when demand for power is low. During a surge in the need for power, headgates (huge caps) are opened to let water rush down the tunnels to drive turbines, which drive powerful generators. Water is thus collected in the lower reservoir and ready to be pumped back up. The greater the distance between upper and lower reservoirs, the more gravitational energy is stored.
Levelised energy storage cost (US$/kWh) Capital cost (US$/kWh)
Source: Coalition to Advance Renewable Energy through Bulk Storage (CAREBS)
Pros & cons

Pros
High capacity Low cost per W No fuel consumed Fast response time
Source: Daiwa
Cons
High capex required Long construction times Power recovered subject to water flow activity and turbine height Disruption to natural river flows and riverside habitat More land space required

Next 5-10 years
Hydropower is a mature technology for large-scale energy storage, suitable for certain geographical locations only. Further cost reductions probably are not possible, while the environmental impact can be high. Forecasting is difficult, as projects are commissioned on a case-by-case basis.
- 35 -

February 2012
Energy storage superconducting magnetic energy storage

Overview
Superconducting magnetic energy storage (SMES) provides the potential for highly efficient storage of electricity by storing electricity from the grid within the magnetic field of a coil composed of superconducting wire, where the continuous circulation of current within the superconducting coil generates stored energy. The only conversion process in a SMES system is from alternating current to direct current, and therefore the inherent thermodynamic losses are nearly zero. The grid-enabling device stores and discharges massive amounts of power almost instantaneously. The system releases a large amount of power within a fraction of a cycle to keep the load interruption free for optimum performance of critical processes. A SMES usually contains two parts a cryogenically cooled superconducting coil and power conditioning system, which are motionless and result in higher reliability. Theoretically, once the superconducting coil is charged, the current will not decay and the magnetic energy can be stored indefinitely. The original development of SMES systems was for load levelling on the grid with renewable energies, such as an alternative to pumped hydroelectric storage, a large energy storage system. However, recent R&D recognised the potential rapid discharge, and relatively high coil costs for bulk storage make smaller systems more economically attractive. Several design and development projects for large-scale applications have begun recently.
Markets
Top developers (2011)
ABB Inc Superpower
Common applications
Electro-magnetic military/naval applications UPS Pulse applications (electron lasers, pulse field, etc) Utility stabilization/power levelling
Source: Daiwa
Source: Daiwa
Structure
Source:
Source: Max Planck Institute
- 36 -

February 2012
2011 numbers
n.a. >45 R&D 95-97
In a SMES system, energy is stored within a magnet that can release megawatts of power within a fraction of a cycle to replace a rapid loss in line power. Energy is stored in the magnetic field created by the flow of DC power in a cryogenically cooled superconducting coil. Energy stored is released back by discharging the coil. The power Source: FermiLab conditioning system uses an inverter/rectifier to convert AC power to DC or vice versa, which only generates a 2-3% energy loss in each direction.
Levelized energy storage cost (US$/kWh) Capital cost (US$/kWh) Stage of development Energy efficiency (%)
Pros & cons

Pros
More environmentally beneficial than battery systems Enhanced transmission line capacity and performance High power density and quick response time Fast recharge (within minutes) and long cycle life (>1000 times)
Cons
Delicate ceramic superconductor materials limit the length of superconducting wires Energy requirements of refrigeration and high coil costs for bulk storage favour smaller systems and short duration storage Costly to maintain operating temperatures Potential energy losses in storage mode
Source: Daiwa

Next 5-10 years
Currently in use in some semiconductor fabs globally for rapid energy discharge. Further development is necessary to lower costs and for use in ESS. Not suitable for automotive applications.
- 37 -

February 2012
Energy storage compressed air energy storage

Overview
A CAES facility consists of a power train motor that drives the compressor, a high pressure turbine (HPT), a low pressure turbine (LPT) and a generator. CAES pre-compresses the air with off-peak electrical power taken from the grid to drive a motor and stores it in large storage reservoirs. During peak hours, the compressed air is released from storage when GT is producing electricity and used in the GT cycle. When the air is released from the cavern it must be mixed with a small amount of gas before entering the turbine to stabilize the temperature and pressure of the air. If the pressure using air alone was high enough to achieve a significant power output, the temperature of the air would be far too low for the materials and connections to tolerate. The amount of gas required is so small that a GT working simultaneously with CAES can produce 3x more electricity. CAES locations are usually decided by natural geological suitability. These include salt caverns, hardrock caverns, depleted gas fields or an aquifer. Salt caverns can be designed to fit specific requirements. Water is pumped into the cavern and left until the salt dissolves and saturates. The water is thus returned to the surface and the process repeats until the required volume cavern is created. This process is expensive and can take up to two years. Typical plant capacities for CAES are between 50 to 300MW. The life of these facilities is longer than existing gas turbines and the charge/discharge ratio is dependent on the size of the compressor used, as well as the size and pressure of the reservoir, in a range of 40-75%.
Markets
Planned/installed CAES facilities (2011)
25MW CAES with an aquifer reservoir (Italy) 100MW x 3 CAES plants (Israel) 2.5GW CAES with limestone mine acting as reservoir ( U.S) 200MW adiabatic CAES project (Germany)
Source: Daiwa
Common applications
Frequency regulation Load following Voltage control
Source: Daiwa
1870s Demo deploy ment 1890s Commercial operation 1970s Utility -scale deploy ment 2010s Limited no. of projects in operation
Structure
Source: Daiwa
Source: Boise State University
- 38 -

February 2012
2011 numbers
0.0050.60 50-120 Mature 40-75
This is a variation on a gas turbine power plant, in which air is compressed into underground mines or caverns and used to improve the efficiency of the gas turbine. When required, the compressed air is utilized in conjunction with a gas turbine to generate electricity, resulting in gas consumption reductions of 60% relative to generating the same amount of electricity directly from gas. New generation of proposed CAES plants may be closely integrated with wind farms, representing a means of storing additional power generated off peak.
Levelized energy storage cost (US$/kWh) Capital cost (US$/kWh) Stage of development Energy efficiency (%)
Source: Ecofriend
Pros & cons

Pros
Relatively fast reaction time and fast ramping rates Large storage capacity Able to undertake frequent start-ups and shutdowns No efficiency reduction from ambient temperature rise No self-discharge and long life span
Source: Daiwa
Cons
Dependence on geographical location Difficulty to identify underground reservoirs High capital costs Reliance on fossil fuel/gas to generate electricity Limited operational experience

Next 5-10 years
Due to geographic limitations and maturity of technology development, use of CAES will be project specific. Moreover, CAES plants require the same sort of underground caverns as for gas storage, meaning that CAES and gas are in competition for suitable sites. Given the increasing importance of security and supply of gas, those caverns may be allocated to gas reserve. Mass adoption for grid is unlikely.
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February 2012
Comparison of all technologies

Energy storage technology ESS EV CE
Li-ion Ultracapacitor Fuel cells Lithium air Lead-acid NiMH Lithium sulphur Sodium sulphur Metal air Flow batteries Flywheel Molten salt Hydropower SMES CAES
Source: Daiwa Note: = Excellent = Good = Usable = Not usable
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February 2012
3. Conclusion
The battle for technology supremacy has not been won except in portable electronics products, and to some extent, for automotive applications, where variations of Li-ion batteries have taken the lead. Grid applications and large energy storage solutions are in their infancy. Our energy-storage technology comparison pullout shows the state of play in promising emerging technologies. In all key applications, lithiumrelated products have the potential to capture market share to varying degrees. For power quality applications (smart-grid/data centre) Lithium-ion batteries (LFP) Flywheels Sodium sulphur batteries Superconducting magnets For energy management applications (energy supply for longer duration) Lithium-ion batteries (LFP) Compressed air energy systems Flow batteries (Vanadium flow) Hydrogen (fuel cells) Molten salt For transport applications Lithium-ion batteries (LMO/NMC/LFP) Ultracapacitors Hydrogen (fuel-cell) Portable electronics product Lithium-ion and polymer batteries (LCO/NMC) Hydrogen (micro-fuel cells)
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February 2012
Investible company list

Company Ultracapacitor Maxwell Technologies NessCap Panasonic Nippon Chemi-Con Fuel cell SFC Energy Mechanical Technology AFC Energy Ballard Power ITM Power United Technologies Fuel Cell Energy Siemens Ceramic Fuel Cells Ceres Power Fuel Cell Energy Plug Power Heliocentris Flywheel Beacon Power Molten salt United Technologies Lead-acid Enersys Exide Industry GS Yuasa Corporation Shin-Kobe Electric Machinery Furukawa Battery LG Chem Camel Group Fengfan Co Zhejiang Narada Power Source Leoch Battery Coslight Group Chaowei Tianneng power Dynapack International Technology NiMH Nihon Kagaku Sangyo Energizer GP ReCyko Sanyo/Panasonic Lithium-Sulphur BASF Sodium-Sulphur NGK Insulators Bloomberg Code MXWL US NCE CN 6752 JP 6997 JP F3C GR MKTY US AFC LN BLDP US ITM LN UTX US FCEL US SIE GR CFU LN CWR LN FCEL US PLUG US H2FA GR BCONQ US UTX US ENS US XIDE US 6674 JP 6934 JP 6937 JP 051910 KS 601311 CH 600482 CH 300068 CH 842 HK 1043 HK 951 HK 819 HK 3211 TT 4094 JP ENR US GPX GR 6752 JP BAS GR 5333 JP Share price (local crncy) 19.93 0.20 707 325 3.97 0.30 30.00 1.45 46.75 83.78 1.34 74.40 6.88 10.25 1.34 2.31 5.03 0.03 83.78 34.73 3.07 433 1,785 386 411,500 21.67 9.34 14.08 2.14 2.87 3.66 4.18 160.00 535 78.15 0.61 707 62.80 1,005 Rating NR NR 3 NR NR NR NR NR NR NR NR NR NR NR NR NR NR NR NR NR NR 3 NR NR NR NR NR NR NR NR 1 NR NR NR NR NR 3 NR 1 Company Lithium-ion A123 Systems Valence Asahi Glass Mitsubishi Chemical Toda Kogyo Sumitomo Metal Mining JFE Holdings Mitsui Mining & Smelting Sumitomo Chemical Sodiff Advanced Materials POSCO Chemtech BYD Co China Steel Chemical Hitachi Chemical Nippon Carbon Showa Denko Toda Kogyo SFC Fine Chemicals Ningbo Shanshan Co Ltd Formosa Energy Kanto Denka Kogyo Stella Chemifa Foosung Zhejiang Juhua Ube Industries Mitsubishi Chemical Holdings Cheil Industries Soulbrain Leechem Jiangsu Guotai Shenzhen Capchem Technology Polypore (Celgard) Asahi Kasei Toray Industries SK Innovation Johnson Controls Saft Groupe China Bak Battery Sanyo/Panasonic Toshiba GS Yuasa Hitachi Sony LG Chem Samsung SDI BYD SinoPoly Battery Ltd Simplo Technology Flow batteries ZBB Energy SMES ABB Inc Bloomberg Code AONE US VLNC US 5201 JP 4188 JP 4100 JP 5713 JP 5411 JP 5706 JP 4005 JP 036490 KS 003670 KS 1211 HK 1723 TT 4217 JP 5302 JP 4004 JP 4100 JP 004000 KS 600884 CH 6505 TT 4047 JP 4109 JP 093370 KS 600160 CH 4208 JP 4188 JP 001300 KS 036830 KS 131100 KS 002091 CH 300037 CH PPO US 3407 JP 3402 JP 096770 KS JCI US SAFT FP CBAK US 6752 JP 6502 JP 6674 JP 6501 JP 6758 JP 051910 KS 006400 KS 1211 HK 729 HK 6121 TT ZBB US ABB US Share price (local crncy) 2.16 0.99 683 476 651 1,170 1,580 230 329 84,800 157,200 24.90 135.00 1,510 215 170 651 62,000 13.38 93.80 290 2,254 7,640 21.56 236 476 98,100 41,050 14,150 14.05 31.67 40.40 496 574 186,500 35.16 22.77 0.79 707 339 433 456 1,623 411,500 144,000 24.90 0.44 207.00 0.77 21.03 Rating NR NR 1 3 2 3 3 3 3 NR NR 3 NR 2 2 2 2 NR NR NR NR 3 2 NR 2 3 NR NR NR NR NR NR 2 4 1 NR NR NR 3 3 3 1 3 NR 3 3 NR 2 NR NR
Source: Bloomberg, Daiwa Daiwa ratings: 1 = Buy, 2= Outperform, 3 = Hold, 4 = Underperform, 5 = Sell Note: Share prices are as of 17 February 2012
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February 2012
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February 2012
Daiwas Asia Pacific Research Directory

Hong Kong Regional Research Head Regional Research Co-head Head of Product Management Head of Thematic Research; Product Management Head of China Research, Chief Economist (Regional) Macro Economics (Regional) Head of Hong Kong Research; Regional Property Coordinator; Co-head of Hong Kong and China Property; Property Developers (Hong Kong) Automobiles and Components (China) Head of Greater China FIG; Banking (Hong Kong, China) Banking (Hong Kong, China) Insurance Capital Goods Electronics Equipments and Machinery (Hong Kong, China) Consumer, Pharmaceuticals and Healthcare (China) Internet (Hong Kong, China) Regional Head of IT/Electronics; Semiconductor/IC Design (Regional) IT/Electronics - Semiconductor/IC Design (Taiwan) Regional Head of Materials; Materials/Energy (Regional) Materials (China) Regional Head of Small/Medium Cap; Small/Medium Cap (Regional) Small/Medium Cap (Regional) Head of Solar Transportation Aviation, Land and Transportation Infrastructure (Regional) Regional Head of Clean Energy and Utilities; Utilities; Power Equipment; Renewables (Hong Kong, China) Head of Custom Products Group; Custom Products Group Custom Products Group Custom Products Group Nagahisa MIYABE Christopher LOBELLO John HETHERINGTON Tathagata Guha ROY Mingchun SUN Kevin LAI Jonas KAN Jeff CHUNG Grace WU Queenie POON Jennifer LAW Joseph HO Hongxia ZHU Alicia HU Eric CHEN Ashley CHUNG Alexander LATZER Felix LAM Mark CHANG John CHOI Pranab Kumar SARMAH Kelvin LAU Dave DAI Justin LAU Philip LO Jibo MA (852) 2848 4971 (852) 2848 4916 (852) 2773 8787 (852) 2773 8731 (852) 2773 8751 (852) 2848 4926 (852) 2848 4439 (852) 2773 8783 (852) 2532 4383 (852) 2532 4381 (852) 2773 8745 (852) 2848 4443 (852) 2848 4460 (852) 2532 4180 (852) 2773 8702 (852) 2848 4431 (852) 2848 4463 (852) 2532 4341 (852) 2773 8729 (852) 2773 8730 (852) 2848 4441 (852) 2848 4467 (852) 2848 4068 (852) 2773 8741 (852) 2773 8714 (852) 2848 4489 nagahisa.miyabe@hk.daiwacm.com christopher.lobello@hk.daiwacm.com john.hetherington@hk.daiwacm.com tathagata.guharoy@hk.daiwacm.com mingchun.sun@hk.daiwacm.com kevin.lai@hk.daiwacm.com jonas.kan@hk.daiwacm.com jeff.chung@hk.daiwacm.com grace.wu@hk.daiwacm.com queenie.poon@hk.daiwacm.com jennifer.law@hk.daiwacm.com joseph.ho@hk.daiwacm.com hongxia.zhu@hk.daiwacm.com alicia.hu@hk.daiwacm.com eric.chen@hk.daiwacm.com ashley.chung@hk.daiwacm.com alexander.latzer@hk.daiwacm.com felix.lam@hk.daiwacm.com mark.chang@hk.daiwacm.com john.choi@hk.daiwacm.com pranab.sarmah@hk.daiwacm.com kelvin.lau@hk.daiwacm.com dave.dai@hk.daiwacm.com justin.lau@hk.daiwacm.com philip.lo@hk.daiwacm.com jibo.ma@hk.daiwacm.com
South Korea Head of Research; Strategy; Banking/Finance Regional Head of Automobiles and Components; Automobiles; Shipbuilding; Steel Banking/Finance Capital Goods (Construction and Machinery) Consumer/Retail IT/Electronics (Tech Hardware and Memory Chips) Materials (Chemicals); Oil and Gas Telecommunications; Software (Internet/Online Games) Custom Products Group Chang H LEE Sung Yop CHUNG Anderson CHA Mike OH Sang Hee PARK Jae H LEE Jihye CHOI Thomas Y KWON Shannen PARK (82) 2 787 9177 (82) 2 787 9157 (82) 2 787 9185 (82) 2 787 9179 (82) 2 787 9165 (82) 2 787 9173 (82) 2 787 9121 (82) 2 787 9181 (82) 2 787 9184 chlee@kr.daiwacm.com sychung@kr.daiwacm.com anderson.cha@kr.daiwacm.com mike.oh@kr.daiwacm.com sanghee.park@kr.daiwacm.com jhlee@kr.daiwacm.com jihye.choi@kr.daiwacm.com yskwon@kr.daiwacm.com shannen.park@kr.daiwacm.com
Taiwan Banking/Diversified Financials Consumer/Retail IT/Technology Hardware (Communications Equipment); Software; Small/Medium Caps IT/Technology Hardware (Handsets and Components) IT/Technology Hardware (PC Hardware - Panels) Jerry YANG Yoshihiko KAWASHIMA Christine WANG Alex CHANG Chris LIN (886) 2 8758 6252 (886) 2 8758 6247 (886) 2 8758 6249 (886) 2 8758 6248 (886) 2 8758 6251 jerry.yang@daiwacm-cathay.com.tw y.kawashima@daiwacm-cathay.com.tw christine.wang@daiwacm-cathay.com.tw alex.chang@daiwacm-cathay.com.tw chris.lin@daiwacm-cathay.com.tw
India Head of India Research; Pharmaceuticals and Healthcare Deputy Head of Research; Strategy; Banking/Finance All Industries Automobiles and Components Capital Goods/Utilities FMCG; Consumer Kartik A. MEHTA Punit SRIVASTAVA Fumio YOKOMICHI Ambrish MISHRA Saurabh MEHTA Percy PANTHAKI (91) 22 6622 1012 (91) 22 6622 1013 (91) 22 6622 1003 (91) 22 6622 1060 (91) 22 6622 1009 (91) 22 6622 1063 kartik.mehta@in.daiwacm.com punit.srivastava@in.daiwacm.com fumio.yokomichi@in.daiwacm.com ambrish.mishra@in.daiwacm.com saurabh.mehta@in.daiwacm.com percy.panthaki@in.daiwacm.com
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February 2012
Singapore Head of Singapore Research Quantitative Research Quantitative Research Banking (ASEAN) Tony DARWELL Josh CHERIAN Suzanne HO Srikanth VADLAMANI (65) 6321 3050 (65) 6499 6549 (65) 6499 6545 (65) 6499 6570 (65) 6499 6548 (65) 6329 2102 (65) 6499 6543 (65) 6321 3085 tony.darwell@sg.daiwacm.com josh.cherian@sg.daiwacm.com suzanne.ho@sg.daiwacm.com srikanth.vadlamani@sg.daiwacm.com adrian.loh@sg.daiwacm.com david.lum@sg.daiwacm.com ramakrishna.maruvada@sg.daiwacm.com amy.chew@sg.daiwacm.com
Regional Head of Oil and Gas; Oil and Gas (ASEAN and China); Capital Goods (Singapore) Adrian LOH Property and REITs Head of ASEAN & India Telecommunications; Telecommunications (ASEAN & India) Thematic Research David LUM Ramakrishna MARUVADA Amy CHEW
Philippines Head of the Philippines Research; Strategy; Capital Goods; Materials Economy; Consumer; Power and Utilities; Transportation Aviation Property; Banking; Transportation Port Rommel RODRIGO Alvin AROGO Danielo PICACHE (63) 2 813 7344 ext 302 rommel.rodrigo@dbpdaiwacm.com.ph (63) 2 813 7344 ext 301 alvin.arogo@dbpdaiwacm.com.ph
(63) 2 813 7344 ext 293 danielo.picache@dbpdaiwacm.com.ph
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February 2012
Daiwas Office
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February 2012
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February 2012
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Energy Storage Toolkit 1202

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Energy Storage Toolkit 1202

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February 2012

Energy Storage Toolkit

Energy Storage Toolkit

Energy Storage Toolkit

Energy storage: making the right connections

Pranab Kumar Sarmah, CFA

Energy Storage Toolkit

1. Overview of the energy storage industry

Energy storage market forecasts by technology

Energy storage market forecasts by application

Source: Various sources, Daiwa forecasts

Why energy storage?

The benefits of energy storage

Applications and technology

Energy Storage Toolkit

How much does it cost?

Levelised energy storage costs (2011)

Technology progress: comparison with IT industry

1 1990 Disk capacity

1992 CPU speed

1996 Battery energy density

1998 RAM available

Wireless transfer speed

Energy Storage Toolkit

Important physical parameters for various applications

Hydrogen Li-ion NiCd Lead-Acid

Ultracap 1kW 10kW 100kW 1MW

SMES 10MW 100MW

Redox flow NaS

Fuel cell 200 400 600

Energy Storage Toolkit

Why energy storage is important

Electricity consumption mix (2010)

Electricity consumption mix (2020)

Nuclear 45.0% Small hydro 9.0%

Unconventional gas 12.0% Wind 16.0%

Energy generation: load balancing becomes complex with renewable energy

Source: Sandia National Laboratories, Daiwa

Energy Storage Toolkit

Energy value chain

Waste energy can be reduced with energy storage systems

Source: Lawrence Livermore National Lab, Daiwa

Peak-saving and load levelling

Load curve Energy supply Energy supply

25 Hours of the day

Energy Storage Toolkit

Energy Storage Toolkit

EV market: technology and product roadmap for EVs (global), 2005-15

Charge time 6-8hrs Battery capacity 16kWh Motor power 70kW

Slow charging - onboard Fast charging mostly off-board Battery swapping

Market for extended range of EVs: technology roadmap for PHEVs

Energy Storage Toolkit

Comparison of car/bus performances with battery and ultracapacitors

Energy Storage Toolkit

Consumer electronics products

Smartphone users complaints mostly relate to short battery life, 2011

29.8 18.4 10.2 5.2 2.5

Typical battery sizes

Typical size Technology

Energy Storage Toolkit

2. Energy storage lithium-ion batteries

Cells (m) 1,034 1,002 759 495 319

Market share (2011)