Even as the world ushers in 2023, a considerable fragment of the collective mind that guides our future energy strategies still seems stuck on an age-old proposal: “Build more transmission capacity.” It’s as if they believe the solution to all our power needs lies in enormous strings of power lines crisscrossing the landscape. A great idea, if not for the minor inconvenience of lacking an Act of Congress to appropriate the millions of acres necessary.
Oh, and then there’s that persistent issue of NIMBYs.
While debates rage, the background hum of innovation grows louder and steadier. Wind, solar, and, most notably, batteries are exploding onto the scene. The rate of investment in battery technology, manufacturing, and growth is skyrocketing, at an increase of approximately 250% per year! Cost? It’s dwindling into the shadows, making new solar farms and battery plants incredibly profitable – the latter often within just two years.
Batteries vs. Transmission: A Duel for the Ages
Here’s the game-changing revelation: Batteries and transmission are duking it out in a direct competition. Both play the essential role of arbitrage in electricity, repricing the resource by matching varying levels of supply and demand. Where transmission moves power through space (or null space, for the physics aficionados), batteries move power through time. But here’s the catch: while batteries have a steadily decreasing fixed cost per MWh delivered, transmission lines grow more expensive with length.
Add to the mix that the competitive length for transmission lines is falling rapidly due to cheaper batteries and costly lawsuits, and the outcome looks rather bleak for traditional transmission.
What really tips the scale in favor of batteries is their knack for adapting to the more varied temporal correlation in energy demand. Whether spread over a 500-mile grid or constrained within local weather systems, spatial correlation of demand is surprisingly uniform. Contrast this with the daily fluctuations in power demand, and the astonishing 18-month profitability of batteries becomes apparent. Why are transmission lines losing money? The answer is clear.
Dive into the Data
Let’s dig into the numbers, reusing figures from the enlightening research “Geophysical constraints on the reliability of solar and wind power in the United States” by Shaner et al., published in 2017.
This chart is a veritable battlefield where different strategies clash. Is it wise to add more transmission, storage, or wind/solar? The results are staggering. Adding transmission barely nudges the needle, while batteries could catapult renewable reliability to support up to 86% of total demand.
The figures in this section pull back the curtain on how renewables can attain even the last fractions of reliability. A grid without storage? Practically useless. But sprinkle in some strategically planned storage, and the overbuild needed for generation diminishes significantly.
The energy landscape of the future? Imagine < 10x nameplate overbuild, 99.99% reliability, and no strings (read: transmission lines) attached.
The Battery Revolution is Here
These findings paint a picture that’s more than just a prediction. It’s a vivid, irrefutable portrait of a future where energy storage takes precedence over outdated and costly transmission lines. We’re staring at a tantalizing glimpse of how the grid will look in the years to come.
By choosing incremental batteries over additional grid infrastructure, we’re not only steering away from stranding assets but also setting sail on a voyage towards profit and value growth.
The future of electricity is local, and it’s powered by batteries. And for those still convinced that transmission lines are the answer? The data tells a different story.
