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The rising demand for lithium-ion batteries far outstrips the obtainable provide, at the same time as
investments into supplies extraction and manufacturing ramp up like by no means earlier than. However what does
the scenario actually appear to be and when will it ease up? Andy Colthorpe investigates.

That is an extract of an article which appeared in Vol.31 of PV Tech Power, {Solar} Media’s quarterly technical journal for the downstream {solar} business. Each version contains ‘Storage & Sensible Energy,’ a devoted part contributed by the workforce at Energy-Storage.news.

It’s no secret there’s a tightness constricting the energy storage provide chain. A couple of weeks in the past, on EnergyStorage.information, we heard from a specialist on procurement, lawyer Adam Walters at Stoel Rives, that lithium carbonate value rises particularly are at “disaster level”.

Rising demand for batteries, largely coming from the electrical automobile (EV) sector, means uncooked supplies costs proceed to be unstable. Cell provider contracts are shifting to shorter and shorter time period pricing. With phrases altering over intervals as brief as per week, it turns into tougher to get them signed off.

Fluence famous in its Q1 2022 monetary outcomes that whereas the corporate’s US$1.6 billion backlog of energy storage orders has been hedged with fastened value contracts, future contracting might be based mostly on uncooked materials listed pricing to minimise publicity to fluctuations. The system integrator shouldn’t be alone on this.

“Traditionally, it was potential to do off-take agreements at fastened value, that’s not the case. Definitely now, all new agreements use index referenced pricing. You’re not going to be successfully getting a secure value. Mounted value contracts, quite common up till this yr in lithium, don’t actually exist anymore,” says Caspar Rawles, chief knowledge officer at lithium battery provide chain data supplier Benchmark Mineral Intelligence.

The demand scenario has been exacerbated by the COVID-19 pandemic, which has thrown logistical complications into the combination for over two years.

The 2-level downside contains logistical issues arising as a knock-on impact of the pandemic — made worse by China’s lockdowns — alongside the continued demand-driven undercurrent of uncooked materials costs hovering.

Think about that the thirst for financial restoration is main politicians, notably in Europe, to put that inside a ‘green restoration’ agenda. That’s undoubtedly a optimistic factor, says Rawles, however places extra pressure on already-constrained provide.
Russia’s invasion of Ukraine can be bringing energy safety points to the fore, alerting Europe to its dependency on Russian gasoline, driving greater gross sales and consciousness of battery storage and EVs in addition to exerting stress on nickel costs.

Joseph Johnson, market and knowledge analyst with {solar} and storage market intelligence group Clear Energy Associates (CEA), says dramatic will increase in pricing not only for lithium, but additionally cobalt, nickel
and different supplies impacts the stationary storage market “very a lot”.
However — and it’s vital to notice this — many EV producers are additionally switching to lithium iron phosphate (LFP) chemistries as an alternative of nickel manganese cobalt (NCM) or nickel cobalt aluminium (NCA)
to cut back their publicity to cobalt and nickel value rises.

Each Benchmark and CEA have famous a couple of 500% enhance since early 2021 in the price of battery grade lithium carbonate from China, which interprets to costs going up ten-fold in greenback values, from about US$8 per kilogram to extra like US$80.

The speedy rise in value of lithium carbonate. Primarily based on knowledge
offered courtesy of Benchmark Mineral Intelligence.

A provide chain scenario some noticed coming

From 2018 to the tip of 2020, there have been basically three years of falling costs, which meant hardly anybody was investing in new provide.
“Regardless of corporations like Benchmark saying ‘that is coming, we will see the numbers and we all know what’s going to be wanted, and we all know how lengthy it takes to carry this new provide on-line,’ there was
an absence of provide chain funding. It was already on the horizon that we have been just about there with lithium, the market was going to get very tight. Then the pandemic hit. Following the pandemic, it has amplified demand,” Rawles says.

Lindsay Gorrill, CEO of US-based cell and techniques producer KORE Energy, was beforehand head of an organization promoting feedstock for lithium battery electrolyte.
From working within the provide chain for 20 years, Gorrill says he understood that creating upstream and downstream capabilities within the US could be the one strategy to resolve the issues that he too noticed coming.
KORE Energy has 2GWh of producing in China, which it’s increasing to 6GWh in 2023 in addition to creating a 12GWh plant in Arizona, US, on which it plans to interrupt floor later this yr. Serving to resolve these long-term provide chain points was what drove the CEO to discovered the corporate within the
first place, he says.
“That complete course of was in my head even six years in the past. I used to be saying, ‘If we don’t begin bringing provide all through upstream to downstream to america or close to america, there’ll be
an issue,’ as a result of earlier than anyone was even speaking about provide chain issues, there was already a scarcity in late 2019.”
“It was already coming earlier than the pandemic — the pandemic simply principally magnified it 30 instances over!”

‘Nice uncooked materials disconnect’

Provide chain investments are actually beginning to occur, however the market dynamic continues to be characterised by what Benchmark Mineral Intelligence has dubbed “the good uncooked materials disconnect” — whereas new battery factories may be inbuilt timeframes of as brief as two years in some circumstances, new materials extraction amenities take a lot, for much longer.
As growth takes place, the market will ultimately attain some form of stability within the latter a part of this decade, however the wave of electrification, from transport to heating to the grid and past, is on an
unprecedented scale.

LFP has been probably the most affected amongst generally used battery chemistries. Primarily based on knowledge offered courtesy of Benchmark Mineral Intelligence.

CEA’s Joseph Johnson additionally refers to a “big disconnect” even between deliberate manufacturing capability additions and projected stationary storage set up figures, someplace between 2x and 4x
— albeit mining and refining is the “actual limiter that determines what number of cells can get produced”.
That upstream capability is beginning to come on-line, however the place a battery manufacturing facility may be inbuilt maybe two to a few years, a brand new mining operation can take a lot, for much longer, something from 5 years at
greatest to many years in excessive circumstances.
With investments having begun at scale from 2019, that factors to 2024 being the earliest the availability chain will begin to ease.
It’ll take at the very least one other couple of years for the fabric extraction facet to actually catch as much as demand.
CEA believes logistics points will probably ease over a two-year window, viewing the tip of 2023-beginning of 2024 timeframe as when availability of containers, extra vessels and sea lanes to hold freight will enhance. Port congestion and backlogs will begin to be resolved and labored by way of.

Whereas demand for ESS, or EVs, hasn’t been massively negatively impacted by the availability chain scenario, it has led to delays for a lot of ESS initiatives. As identified by Stoel Rives’ Adam Walters, we’re more likely to
see many extra initiatives get delayed.
Nonetheless, Rawles says that quite a few ESS suppliers which have moved into a price pass-through construction of their contracts are discovering it a tricky monetary hit to bear, eroding “the entire margin”.

All our interviewees say the scenario will ease and that actions being taken as we speak could make for a extra sturdy business and worth chain tomorrow. However it would take time, it would take funding, it would take
laborious work.

It additionally represents a chance to create an enormous business, a world supply of recent jobs and naturally the very engine of the transition to sustainable energy.

That is an extract of an article which appeared in Vol.31 of PV Tech Power, {Solar} Media’s quarterly technical journal for the downstream {solar} business. Each version contains ‘Storage & Sensible Energy,’ a devoted part contributed by the workforce at Energy-Storage.news.



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Nearly 70,000 US battery storage jobs in 2021

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Burns & McDonnell completes three 20MWh Texas battery storage projects in five months


The variety of folks within the US working in battery storage continued to develop in 2021, including practically 3,000 jobs from the earlier yr.

In response to the most recent version of the US Division of Energy’s (DOE) annual US Energy and Employment Report (USEER), 69,698 staff have been employed in battery storage in 2021.

This equated to a rise of 4.4% over 2020, when the quantity stood at 66,749, and continued enhance from 2019’s 65,904 battery storage staff.

Though battery storage wasn’t counted as a separate breakout class in 2016, the primary yr the USEER report was revealed (masking statistics from 2015), the 2020 version which compiled the earlier 5 editions’ takeaways famous that from 2016 to 2019 a complete of 18,300 battery storage jobs have been added – equal to development of 38%.

Greater than half of staff within the sector (53%) as of 2021 have been in development, 18% in manufacturing, 17% in numerous skilled providers roles, 11% in wholesale commerce, distribution and transport and a remaining 2% categorised as suppliers of “different providers”.

The DOE surveyed about 33,000 non-public energy companies and mixed that with public labour information to create its snapshot of estimates throughout 5 main energy sectors: electric energy era, fuels, energy effectivity, motor autos and transmission, distribution and storage.

Energy storage is counted as a subset of transmission, distribution and storage. The variety of battery storage jobs was virtually 9 occasions larger than the following highest storage class, pumped hydro energy storage (PHES), which employed 7,901 folks in 2021.

In actual fact, battery storage accounted for 80% of all 86,584 storage jobs, with different classes together with petroleum, pure gasoline and different fuels.

In the meantime, in energy era classes, {solar} employed 333,887 folks, an increase of 5.4% (17,212) from the yr earlier than, whereas wind energy employed 120,164 folks. Battery storage has virtually caught up with coal’s 70,831 worker numbers and employs extra staff than superior pure gasoline (69,113), nuclear (55,562) and different energy era know-how together with pure gasoline and conventional hydroelectric as nicely.

US battery storage jobs have risen considerably because the first version of the report estimated figures for 2015. Picture: {Solar} Media from USEER information.

Nonetheless, regardless of an total development in energy employment, as our {solar} PV colleagues over at PV Tech noted in their coverage of the report last week, it isn’t all excellent news.

Energy sector job numbers nonetheless haven’t returned to pre-pandemic ranges after some 840,000 jobs in whole have been misplaced by the top of 2020. Secretary of Energy Jennifer Granholm did observe that regardless of a difficult interval, the energy sector was nonetheless a standout amongst US industries for job development in 2021.

Maybe unsurprisingly, Texas and California made essentially the most new energy sector hires in 2021, with round 31,000 and 29,000 new jobs respectively.

It was additionally famous that girls stay underrepresented within the energy sector, making up 1 / 4 of all jobs versus a nationwide common of practically half, whereas Black or African American staff have been 8% of the energy workforce versus 12% nationwide common throughout all industries.

The total 2022 USEER report could be discovered here.



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Vattenfall starts filling up 200MW thermal storage tower in Berlin

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vattenfall thermal energy storage tower berlin reuter west


Swedish public utility Vattenfall is about to start out filling a 45m-high, 200MW-rated thermal energy storage facility with water in Berlin, Germany.

The warmth storage tank can maintain 56 million litres of water which will probably be heated at 98 levels celsius and will probably be mixed with the present power-to-heat system of Vattenfall’s adjoining Reuter West energy plant.

The water will probably be fed instantly into the district heating community to produce prospects’ heating wants of their houses, an organization spokesperson instructed Energy-Storage.information. The filling is anticipated to take two months, adopted by a interval of testing earlier than business operation begins in April 2023.

Jornt Spijksma, venture supervisor at Vattenfall, mentioned that the mixture of Reuter West and the storage tank varieties an “optimum, fossil-free and future-proof part to produce our Berlin prospects with warmth.”

He defined that when there’s a surplus of wind energy, the power-to-heat system can convert that surplus into warmth to be saved within the tank, decreasing any must curtail wind manufacturing. The storage tank may also combine warmth from different industrial processes equivalent to the town’s cleansing division or waste warmth from waste water.

The spokesperson added that it might doubtlessly additionally join with different renewable warmth sources equivalent to a large-scale warmth pump.

The tank has a most thermal output of 200MW which it may well discharge for 13 hours, making it a 2,600MWh system.

Vattenfall labored with three separate corporations to ship the venture though has not revealed their names. Development started in January 2022.

The corporate mentioned that the storage tank is important for securing warmth provide for its prospects, with the flexibility to make sure provide even throughout chilly climate (Berlin usually has very chilly winters).



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Billions of dollars net benefit from grid-scale BESS in NSW

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Billions of dollars net benefit from grid-scale BESS in NSW


Grid-scale battery storage has emerged as the popular possibility to make sure dependable electrical energy provides in areas of New South Wales, Australia, transmission operator Transgrid has stated.

Transgrid has checked out “a number of choices” for addressing load constraints on the community in and across the cities of Bathhurst, Parkes and Orange in addition to the North West Slopes areas of New South Wales (NSW).

Every space is experiencing progress in electrical energy demand and the development is anticipated to proceed. Constraints might result in failures in delivering dependable provides of electrical energy.

Transgrid is supervisor and operator of the excessive voltage electrical energy community serving New South Wales and the Australian Capital Territory (ACT).

The grid operator issued Undertaking Evaluation Conclusions Reviews final week, regarding potential funding choices that it will search approval for from the Australian Energy Regulator, with Bathhurst, Orange and Parkes areas thought of in a single report and the North West Slopes in one other.

“We checked out a number of choices for addressing load constraints on our community and we’re excited to say that grid-scale batteries have been recognized as the popular possibility as they supplied the best general profit,” Transgrid govt common supervisor of community, Marie Jordan stated.

It is among the first occasions up to now large-scale batteries for the Nationwide Electrical energy Market (NEM) “have outperformed different choices all through the regulatory take a look at,” Jordan stated.

Battery tasks proposed by two third-party suppliers ranked equally as the highest possibility within the Undertaking Evaluation Conclusions Reviews.

They’d have the ability to take part out there along with assembly their community help commitments, however this participation can be restricted throughout winter and summer season intervals when community help wants are more likely to be extra acute. In spring and autumn, market participation can be much less restricted.

Batteries would have the ability to cost with renewable energy at occasions of plentiful technology and off-peak demand intervals, discharging to the community when technology is decrease and demand greater. They’d additionally present providers like reactive energy help.

For Bathhurst, Orange and Parkes, the buildout would comprise a 20MW/40MWh battery energy storage system (BESS) at Parkes and a 25MW/50MWh BESS at Panorama within the suburb of Bathhurst. A 25MVa synchronous condenser and a brand new 132 kV transmission line are additionally amongst thought of choices which could possibly be picked as complementary to the battery techniques.

Within the North West Slopes, a 50MW/50MWh BESS has been proposed for development within the locality of Narrabri in addition to one other BESS of unspecified output and capability at Gunnedah substation. The North West Slopes plan additionally contains some transmission upgrades, which Transgrid stated could possibly be executed with minimal disruption by being place on current strains.

In every case, batteries had been chosen partly due to their potential to be constructed and commissioned a lot earlier than different proposals. The BESS could possibly be in place and in operation by a 2024-2025 timeline.

Aggressive solicitation set to start

A aggressive procurement course of will now be launched by the transmission operator and industrial negotiations carried out.

The Narrabri BESS might present roughly A$513 million (US$350.33 million) in internet advantages and the BESS at Gunnedah about A$496 million. The 2 BESS choices for Bathhurst, Orange and Parkes might present A$3,221 million and A$3,202 million in internet advantages, in response to Transgrid.

The announcement comes simply after the Australian Energy Market Operator (AEMO) forecast that batteries and different energy storage can be a serious participant in transitioning the NEM to low carbon energy within the coming many years.

By 2050, as coal declines in significance and disappears completely from the supply of base load energy to the NEM, the market’s firming capability combine would require 46GW/640GWh of dispatchable storage capacity, AEMO said.

This is able to be along with 7GW of current non-pumped hydro hydroelectric capability and a few 10GW of fuel technology, in response to AEMO’s Built-in System Plan (ISP) 30-year roadmap for the NEM.

Australia’s energy market is at the moment in disaster mode, with excessive electrical energy costs pushed by fuel worth volatility and outages at round 3GW of coal crops – though the latter scenario is believed to have been resolved. This comes because the nation experiences a few of its coldest winter climate for many years and for a few weeks final month AEMO temporarily suspended spot market trading in the NEM.

The scenario has pushed requires higher funding in renewables and storage – and for a national energy storage target policy.

As reported by the Sydney Morning Herald newspaper final week, there are additionally considerations for greater drilling for fossil fuels in the area around Narrabri.



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