By Anna W. Aamone
With regard to energy storage systems, many people erroneously think that the only cost they should consider is the initial – that is, the cost of generating electricity per kilowatt-hour. However, they are not aware of another very important factor.
This is the so-called LCOE, levelized cost of energy (also known as cost of electricity by source), which helps calculate the price of the electricity generated by a specific source. The LCOE also includes other costs associated with producing or storing that energy, such as maintenance and operating costs, residual value, the useful life of the system and the round-trip efficiency. Some of these factors will be discussed in this article, so if you want to get a solid grasp of the matter, check the information provided below.
In other words: You charge your battery, believing you will use 100 percent of it, but the truth is that you will only get to use about 75 percent due to loss of energy somewhere along the way. It's just inevitable. Roughly speaking, you can only release about 75 kilowatt-hours from a battery that has been charged with 100 kWh of electricity. Those 25 kWh of electricity get wasted for a number of reasons like the ones mentioned above (heat, improper maintenance, etc.). Are you getting the idea? So, as it turns out, using batteries is not free either. And it has to be added to the final cost of the energy storage system.
The good news is, flow batteries can be charged and discharged a million times without wearing out. Hence, cycling is not an issue with this type of battery, and you should keep this in mind before selecting an energy storage system. Think twice about whether you want to use batteries that wear out too quickly because their useful life depends on the number of times they are charged and discharged. Or would you rather use flow batteries, the LCOE of which is much lower than that of standard batteries?
So, what do we have so far?
LCOE = Round-trip efficiency + maintenance costs + useful life of the energy system.
These are three of the most important factors that determine the LCOE. Make sure you consider all the factors that determine the true cost of energy storage systems before you buy one.
Image credit: Flickr/INL
Anna W. Aamone works for TopDomesticCleaners Crofton Park. She likes to spend her free time at quiet places like small local cafés or playing chess in the near park.