Storing for the Future
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Storing for the FutureMaciej Nowicki Martin Weiss Vladimir Zejda Pawel ZoltkoBeating the Elite
The ChallengeHow can DONG Energy leverage its portfolio of technologies and partnership to profitably lead the next revolution in the energy sector providing a clean yet reliable energy supply?We were asked:And answered:By concentrating on a new strategy that follows the 3 key pillars of DONG Energy:CleanReliableProfitableUtilizes the companys key strengths and is focused on the long term profitability.While operating in an environment that is: increasingly competitive and consolidated & focused on clean energy.
Evaluating DONGs Technology PortfolioRenewablesGenerationExploration&ProductionWindHydroCoalBiomassGasOilGasCurrentFocusCleanLongterm Growth PotentialReliableTOTAL1310910121112
DONG has a great potential in the growing European wind energy market
Global leader in offshore windparks30% market shareExtensive experienceDecided expansion plansDONGMARKET
Wind Energy Market: Target & Consumption (Europe)Growth to 34GW by 2020EU supportRenewable energy advancement (German phase-out,...)
Energy storage as a solution to low reliability The great downside of wind power farms is their unpredictability.
UnreliabilityFluctuations in outputWeatherEnergyStorageEfficient wind energy managementReliable power supply & stable power networkLong term competitive advantage in the renewable energy sectorImproved trading opportunitiesAn edge in the new trends emergence (e-cars, smart grids)
Drivers & Constraints of energy storageDRIVERSCONSTRAINTSImpact:highmediumlowIntermittent nature of renewable energyGrowth of electric vehicles/smart gridsExpensive grid upgrades deferredEU legislation and efforts (20-20-20)High investment costsLong implementation periodLow energy density1-2yrs3-5 yrs6-10 yrs1-2yrs3-5 yrs6-10 yrs
Reducing risksThis means risk.Energy storage is a new territory for DONG Energy.
Strategic partnership w/ a energy storage specialized company/-iesLack of technological know-howCapital intensive project (lack of resources)toGain access to R&D, knowledge,lower the project costs,and attract external investors.
Choosing the right partnersStorage EnergyPlayers
Chosing the solututionPotential Partners
TechnologyBatteryCAESHydrogenPreferenceUsed forLikely impl. in the long termFarms located near cavernsPrefered in windfarmsPROSCONSStorage has relatively high efficiency: as high as 90% or better
High maintenance and have limited lifespans
Battery technologyHigh potential for development costs likely to drop considerably, efficiency to riseCOSTSFrom $508/kWh for a 10MW, 10MWh unit to $196/kWh for a 10MW, 40MWh unit
Total plant costs:$227/kWh for a 100MWh plant$810/kWh for a 10MWh plant
ConclusionThe energy storage project will lead to: Efficient wind energy managementReliable power supply & stable power networkLong term competitive advantage in the renewable energy sectorAn edge in the new energy industry trends emergence (e-cars, smart grids) Answers the call to utilize the technology and partnerships portfolio asked by the management in a clean, reliable, and profitable way.Improved trading opportunities