At present, the report noted, the US has about 24.6 GW (approx. 2.3% of total electric production capacity) of grid storage, 95% of which is pumped storage hydro. Europe and Japan have notably higher fractions of grid storage.

Energy storage technologies such as pumped hydro, compressed air energy storage, various types of batteries, flywheels, electrochemical capacitors, etc., support multiple applications: energy management, backup power, load leveling, frequency regulation, voltage support, and grid stabilization. Not every type of storage is suitable for every type of application, motivating the need for a portfolio strategy for energy storage technology.

The report identifies four challenges that must be addressed to enable energy storage:

• Development of cost-effective energy storage technologies (including manufacturing and grid integration);
• Validated reliability and safety;
• An equitable regulatory environment; and
• Industry acceptance.

The need for energy storage in the electric grid is increasing as a result of the growing use of renewable power generation, which varies with wind and solar conditions, and increasing frequency of severe weather caused by climate change. The grid’s evolution toward more distributed energy systems and the incorporation of electric vehicles and plug-in hybrids also contributes to the growing interest in grid storage.

The future for energy storage in the US should address the following issues: energy storage technologies should be cost competitive (unsubsidized) with other technologies providing similar services; energy storage should be recognized for its value in providing multiple benefits simultaneously; and ultimately, storage technology should seamlessly integrate with existing systems and sub-systems leading to its ubiquitous deployment.

In reviewing the barriers and challenges, and the future for energy storage, a strategy that would address these issues should comprise three broad outcome-oriented goals:

1. Energy storage should be a broadly deployable asset for enhancing renewable penetration—specifically to enable storage deployment at high levels of new renewable generation.

2. Energy storage should be available to industry and regulators as an effective option to resolve issues of grid resiliency and reliability.

3. Energy storage should be a well-accepted contributor to realization of smart-grid benefits—specifically enabling confident deployment of electric transportation and optimal utilization of demand-side assets.

—“Grid Energy Storage”

The storage report, developed by the Energy Department with input from industry, academia, and government stakeholders, identifies efforts to address each of the four key challenges. Some of the key strategic actions are:

• Cost-competitive energy storage technology can be achieved through research, resolving economic and performance barriers, and creating analytical tools for design, manufacturing, innovation and deployment.

• The reliability and safety of energy storage technologies can be validated through research and development, creation of standard testing protocols, independent testing against utility requirements, and documenting the performance of installed systems.

• Establishing an equitable regulatory environment is possible by conducting public-private evaluations of grid benefits, exploring technology-neutral mechanisms for monetizing grid services, and developing industry and regulatory agency-accepted standards for siting, grid integration, procurement and performance evaluation.

• Industry acceptance can be achieved through field trials and demonstrations and use of industry-accepted planning and operational tools to incorporate storage onto the grid.