Vanadium redox flow market gaining momentum as China commissions new 100MW system
In 2019, VRB Energy, a Canadian battery manufacturer was commissioned to begin the first development phase of a (not so) small-scale 40 megawatt peak-load shifting power plant in the Hubei province of China. As the scene begins to change, VRB is now moving on to build a 100 megawatt system to be paired alongside a solar power station in the same province. As these new commissions ramp up, VRB is positioning to produce vanadium redox flow battery systems at the gigafactory scale in order to support China’s anticipated 1000 new gigawatts of renewable energy by 2030. This all comes two years after the announcement of Rongke Power being commissioned to build the world’s largest battery system, a 200 megawatt ‘peak-load shifting power plant’ in Dailan, China (Elektrek). By all accounts, the commercial opportunity for flow battery systems is gaining strong momentum, and China is leading the way.
How peak-load shifting power plants are shifting the dynamic of modern energy grids
One of the most intriguing aspects of large scale flow battery systems is their potential to function as a fast-acting quasi-power plant to smooth out and prevent spikes in electricity prices.
To transport electricity from the power plants to homes and businesses, generators and network operators are involved in a highly complex balancing act as they work to maintain adequate supply of electricity to the grid while demand fluctuates throughout the day. This dance has become increasingly complex with the integration of solar and wind farms, whose energy production can be highly variable depending on the weather conditions and time of day.
In general, electricity is priced relative to its cost of production in what is know as a ‘merit order’, where the lowest cost producers always maintain priority, as shown in the graphic below. During periods of abnormally high electricity demand, network operators require fast-acting power plants to be mobilized in order to maintain grid stability.
Typically, natural gas or even diesel generators will be called upon to meet the demand, however in such instances, these marginal producers can reap huge rewards as electricity prices begin to spike. Market interruptions like we saw during the Texas winter storms this year are a perfect example of what can go wrong when market balancing mechanisms fail to respond.
For years, the integration of battery systems has been highlighted as a necessary solution to the challenge of intermittent renewable energy production, however cost, scalability and cycling degradation have been problematic to their success.
While energy storage installations bear high capital expenditures, the introduction of large-scale smart flow battery systems present the potential for dramatic improvements in efficiency and operational costs. When coupled with software flow battery systems can automatically store or release electricity into the grid depending on demand at any given moment, presenting the potential to cut high-cost electricity production out of the merit order curve if enough storage is made available. While arguable that adequate energy storage could have prevented the blackouts in Texas, there is still a long way to go in terms of making enough storage available. Grid analysis firm, Vibrant Clean Energy, stated while possible, it would require upwards of 40,000 megawatts to cushion supply disruptions during the winter storms (PV Magazine).
The promise of vanadium redox flow batteries
Vanadium is a rare earth metal, traditionally known for its critical use in steel manufacturing, however it has recently found another valuable application in the production of electrolyte solutions needed for large-scale flow battery systems. While vanadium redox flow batteries are not small or responsive enough for use in small electronic or vehicle applications, their slow cycling and highly scalable capacity makes them perfect for grid-scale applications.
Source: Cell Cube Investor Presentation
Beyond being able meet the scale of virtually any demand requirements, vanadium redox flow batteries come with a number of other advantages that make them an excellent candidate for grid energy storage.
Watch this video for a quick overview of how the technology works:
The infinitely cyclable battery:
Our common experience with smartphones has conditioned us to the idea that batteries consistently degrade over time, however vanadium flow batteries are uniquely wonderful in that they can be charged and discharged thousands of times with no change in their capacity retention. Although the cycling degradation of lithium-ion batteries is not such an issue for small electronics, infrastructure projects for energy grids call for long-lasting solutions that will not require additional capex throughout the span of their lifetime.
Fully recyclable electrolytes:
One of the other great advantages of VRFB is the recyclability of the electrolyte solution. This means that once the battery system life has been expended, vanadium can be easily extracted and repurposed for the steel or energy storage industry. This distinction has opened the possibility of new business models like rentable electrolyte solutions introduced by Bushveld Minerals, which further reduce the cost of energy storage while providing a greener solution than lithium-ion, whose layered architecture has makes them difficult to recycle. Moreover, vanadium is a largely inert and non-toxic material and unlike lithium-ion, poses virtually no risk of fire.
Challenges remaining:
Like all new technologies, while vanadium redox flow batteries offer a promising solution to our energy storage needs, there remain challenges to overcome. While the electrolyte solution used in these batteries is recyclable, the upfront cost for the electrolyte can be as much as 35% of the battery system itself (Energy Storage News). Electrolyte rentals can help reduce capital costs, however the price of vanadium remains highly volatile and supply competition between consumers from both the steel and energy storage industries could lead to much higher prices in the future.
In spite of these challenges, among many other countries that have heavily pushed for the implementation of renewable energy capacity, the US is looking to pull itself ahead in the energy storage sector, recently announcing $20 million dollars in funding for research that will advance flow battery commercialization and development (Solar Power World).
While renewable energy has been a challenging addition to existing grid infrastructure, energy storage solutions like flow batteries look to make clean power a much more practical solution to achieving global climate goals.