Compressed air energy storage will realize industrialization

In the new power system, energy storaging will become a crucial link, which is a necessary guarantee for new energy consumption and grid security. It will be widely used in the generation side, grid side and power consumption side. In the Chinese market, new energy allocation and storage, independent energy storage and other landing forms have promoted its growth demand index.

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Driven by the outbreak of market demand and policy encouragement, the mature pumped storage and lithium battery storage showed explosive growth, and new long term energy storage technologies such as compressed air energy storage and liquid flow energy storage also entered the fast lane of development.

After several years of development, compressed air energy storage has ushered in the primary stage of industrialization. As of September this year, China’s compressed air energy storage capacity under construction/to be built has exceeded 6 million kilowatts, and the industry is expected to usher in a commercial year.

Compressed air energy storage is more suitable for large-scale promotion

Compressed air energy storage is a large-scale long-term mechanical power storage method, which is characterized by:

● Large capacity: The capacity of existing contracted projects reaches 1GW/6GWh
● Safety and environmental protection: No explosion risk
● Low cost: The unit investment cost of the existing planned project is 5-6 RMB/W, and the cost of electricity per kilowatt hour is 0.45-0.5 RMB/KWh
● Long service life: More than 30 years
● Short construction period: 1.5-2 years
● High energy conversion efficiency: It has reached more than 70%

Compared with hydrogen energy storage, gravity energy storage, liquid flow battery and other long-term power storage routes, compressed air energy storage is closer to large-scale promotion in terms of economy and technical maturity.

Thermal storage compressed air power storage is the current mainstream

Compressed air energy storage can be divided into two types: afterburning type and non afterburning type according to whether it is divided into hot pressure separate storage or not. The current production in China is non afterburning, of which the thermal storage (insulation) system is the mainstream.

The afterburning system only stores the pressure potential energy, and the heat energy is provided by the combustion of fuel in the combustion chamber. In the 20th century, other countries have adopted this technical route for projects that have been put into production, and the efficiency is generally lower than 55%.

The non afterburning type stores the compression heat generated in the compression process in the form of heat energy in the heat storage tank, and the efficiency can be improved to 60% – 70%. Among them, the thermal insulation system realizes the recovery and reuse of the compression heat, greatly improving the system efficiency.

The cost of compressed air energy storage has dropped

After years of development, the cost of compressed air energy storage has dropped rapidly. In 2014, China’s first compressed air demonstration project, Wuhu 500kw Power Station, was put into operation, with a unit investment cost of about 60000 RMB/kw. However, the unit investment cost of Feicheng Phase I 10000kW Power Station, which was put into operation last year, has dropped to 10000 RMB/kW.

At present, the lowest unit investment cost of the project under construction/feasibility study/contract has reached 5-6 RMB/W, which is close to the saved 5.5-7.0 RMB/W. A set of 10MW compressed air energy storaging system has a service life of more than 30 years, and the cost of power storage is 0.3~0.5 RMB/kWh.

According to other estimates in the industry, under the two scenarios of peak shaving and valley filling and the consumption of renewable energy on the power side, the cost per kilowatt hour of compressed air energy storaging at this stage is 0.904 RMB/kWh and 0.441 RMB/kWh respectively, which is lower than that of lithium iron phosphate battery storage and close to that of small and medium-sized pumped storage.

By 2025, it is expected to be reduced to 0.748 RMB/kWh and 0.321 RMB/kWh respectively. In the long run, as the cost of the industrial chain accelerates to decline, the cost performance of compressed air storaged energy technology will become increasingly prominent, and the installed capacity is expected to grow rapidly.

Compressed air energy storage planning project has exceeded 6GW

By the end of September 2022, the capacity of China’s compressed air energy storaging projects has increased significantly, with an installed capacity of 182.5MW; The projects under construction/under preparation have reached 6.32GW. According to the data, by 2025, the new powert storage capacity will be more than 30 million kilowatts. The installed capacity of compressed air energy storage will account for about 20%.

Under optimistic expectation, the installed capacity of compressed air energy storage in China is expected to reach 10 million kilowatts by 2025 and more than 58 million kilowatts by 2030; Under pessimistic expectation, the installed capacity in China will be more than 3.5 million kilowatts and 27 million kilowatts respectively in 2025 and 2030.

The market space of compressed air energy storage core equipment is considerable

As the compressed air storage power plant is expected to enter the stage of industrial development, its core equipment will also usher in a broader incremental space. The upstream of the compressed air energy storage industry chain includes equipment (compressor, expander, heat exchanger, etc.), salt cavern/gas storage tank, etc.

From the perspective of investment proportion, the construction of compressed air energy storage project can be roughly divided into core equipment, other equipment, electrical control system, civil engineering and construction, among which the expenditure on core equipment accounts for 40% – 50% of the total construction cost, mainly air compressor and turbine expander.

According to the expected new installed capacity of 6.6/43.0GW of compressed air energy storage in China in 2025/2030, assuming that the value of the above core equipment accounts for 45% and the unit investment cost is 6 RMB/W, the market space of compressors and expanders required for compressed air in 2022-2025 will be 17.8 billion RMB in total, and that in 2022-2030 will be 116 billion RMB in total.