ANALYSIS-Russia gas crisis highlights Europe's green energy storage problem

* War in Ukraine spurs drive to move away from Russian gas * Green energy companies devising solutions to boost storage * But financing and political will to invest in short supply By Umberto Bacchi June 10 (Thomson Reuters Foundation) - From dropping weights down old mine shafts to pumping compressed air into caves, companies are racing to develop inventive new solutions to store renewable energy as European nations try to move away from Russian fossil fuels.

* War in Ukraine spurs drive to move away from Russian gas * Green energy companies devising solutions to boost storage

* But financing and political will to invest in short supply By Umberto Bacchi

June 10 (Thomson Reuters Foundation) - From dropping weights down old mine shafts to pumping compressed air into caves, companies are racing to develop inventive new solutions to store renewable energy as European nations try to move away from Russian fossil fuels. Expanding storage is vital to ensure a consistent supply of electricity as countries shift to using more clean power from wind turbines and solar panels, which do not provide round-the-clock supplies, analysts say.

But today's most broadly used solutions - such as storing power in hydropower reservoirs or in lithium batteries - have drawbacks ranging from environmental impact to limited lifespan, leading to a growing search for alternatives. Those could become increasingly important as Russia's invasion of Ukraine sparks worries across Europe about gas supplies and rising prices, spurring calls and plans for a faster transition to green energy.

The European Commission in May unveiled a 210 billion-euro https://www.reuters.com/business/sustainable-business/eu-unveils-escape-route-russian-fossil-fuels-by-2027-2022-05-18plan for Europe to end its reliance on Russian fossil fuels. It also proposed a legally-binding target to get 45% of EU energy from renewable sources by 2030, up from the current goal of 40%. But as governments worldwide race to build more renewable energy plants in a bid to meet global climate goals, green energy storage capacity has lagged, industry experts say.

The European Union needs to more than triple its storage capacity by 2030 to adequately support its green transition, said Patrick Clerens, who heads the European Association for the Storage of Energy (EASE), an industry group. That means installing about 14 gigawatts (GW) of storage annually for the next eight years - up from the roughly 1 GW of additional capacity put in place in 2021, he said.

"It's a huge effort," Clerens said in a telephone interview. "We will need any storage technology that is out there." Adding storage quickly is key to reach the Paris Agreement goal to cut carbon emissions to net-zero around 2050. The International Energy Agency estimated last year that total energy storage capacity would have to expand 35-fold this decade.

Russia's war in Ukraine has brought even more urgency, Clerens added. European countries currently burn gas to help shore up the electricity grid when production from renewables is low. But that is becoming more costly, with the conflict pushing up prices and Russia, which typically provides around 40% of the EU's gas, retaliating against sanctions by curbing supplies.

Investing in renewables with storage could help reduce such risks - but most governments have turned instead to more fossil fuels to replace Russian gas supplies, according to an analysis published this week by the Climate Action Tracker (CAT). WEIGHTS AND WATER

More than 90% of global electricity storage capacity is provided by 'pumped hydro' https://www.hydropower.org/factsheets/pumped-storage, a system in which excess electricity is used to pump water uphill so it can later run through a hydropower dam's turbines when added power is needed. Although well-established, such systems can't work in many places, said Billy Wu, a senior lecturer at Imperial College London who studies energy storage.

"You can't really put a hydroelectric dam everywhere. It's geographically confined, and there's a huge amount of capital needed," Wu told the Thomson Reuters Foundation by phone. Other efforts to boost renewable power storage capacity have largely focused on lithium-ion batteries.

The cost of these batteries has plunged over the last three decades, according to a 2021 study https://news.mit.edu/2021/lithium-ion-battery-costs-0323 by the Massachusetts Institute of Technology, making them an increasingly viable solution. But critics object that they have a short lifespan – up to 10 years - and mining the needed raw materials such as lithium https://www.foeeurope.org/sites/default/files/publications/13_factsheet-lithium-gb.pdf and cobalt often causes environmental harm.

That has led to a growing search for other alternatives. Some energy storage companies, for instance, are pumping compressed air into underground caverns or other containers, using excess renewable power. When power is needed it is then released to run turbines.

Other systems, like pumped hydro, take advantage of gravity. A process developed by Britain's Gravitricity stores energy by using spare electricity to winch weights up abandoned mine shafts. When the weights are later slowly let back down, they drive turbines to produce energy.

Switzerland's Energy Vault uses a similar system with weights lifted above ground, while Gravity Power in the United States and Germany's Gravity Storage GmbH aim to use excess energy to run water pumps to lift weights in underground silos. Another storage approach - "power-to-gas" - involves converting renewable electricity into combustible gases, usually hydrogen, which can later be burned to produce electricity.

One firm, Electrochaea, produces "synthetic" methane using microorganisms and hydrogen made using renewable energy. "You can take energy from a windmill ... (and) convert that into chemical bonds of synthetic methane that you can have on call when you need it," said Mich Hein, the German company's CEO.

LACK OF FINANCE Proponents say some of these solutions have an edge on pumped hydro and battery storage because they can be installed in a wide range of places and many could last for decades with only simple maintenance.

Financing, however, is a problem. While most such energy storage firms have created or are developing proof-of-concept pilots, almost all are yet to build their first large plant. Securing investors is often cited as the main hurdle.

"(The problem) is not the economics of our technology, it's getting the first project built," said Gravitricity's managing director, Charlie Blair. "We face the same challenge of pretty much every renewable technology in the world, which is being relatively expensive at the beginning," he said.

As a result, "investors are sort of understandably nervous." Patchy and dated regulatory frameworks are also an issue, with innovative storage firms lamenting that many countries still see building storage as a job for government and large power utilities, even though there is now an ecosystem of start-ups ready to do so.

"Regulations in most energy markets are not properly laid out for storage," said Gravity Storage GmbH's managing director Sven Bode. Storage firms can normally turn a profit by buying electricity when it is cheap and selling when it is expensive - but the strategy is tricky in some places.

In Germany, for example, storage facilities are treated as end-use energy consumers, meaning they pay fees and taxes on the energy they buy, even if they later resell it, according to Bode. Incentives are also lacking for long-term, seasonal storage of electricity - such as keeping abundant solar power harvested in summer in storage for use in winter, when energy demand is higher.

That means firms working on new storage ideas see little current benefit in developing systems that would holding energy that long. Some governments have moved ahead. The state of California for instance, has mandated that utilities install storage capacity, which has helped spur development in the sector.

In Europe, countries including Spain https://www.energy-storage.news/spain-targets-20gw-of-energy-storage-by-2030-as-part-of-new-strategy and Greece https://www.energy-storage.news/greece-doubles-2030-energy-storage-target-to-3gw/#:~:text=Greek%20minister%20Kostas%20Skrekas%20meeting,electricity%20generation%20proportion%20of%2070%25 have set energy storage capacity targets, and EASE is lobbying for the EU to set its own goal, which Clerens said could ease investors' minds by putting political will behind storage projects. Funding more research into solutions and setting up pricing mechanisms that reward storing energy would also help the industry, he said.

"It makes no sense to roll out more renewables if we throw away the energy they produce when we have too much and replace it with imported gas when we need it," said Clerens. "We need a proper energy storage strategy."

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