Making way for energy storage in mining

Delta's Energy Storage System

South Australia’s power grid failures in 2016 launched energy security into the spotlight and sparked a push to ensure the energy stability in the state.

The first power grid failure during storms on September 28 2016 caused a blackout that affected 850,000 of the state’s businesses, homes, transport services and industries

An Australian Energy Market Operator (AEMO) report on the blackout highlighted that it was triggered by tornadoes – travelling at wind speeds up to 260km – that damaged a single circuit 275 kilovolt (kV) transmission line and double circuit 276kV transmission line, causing them to fault and subsequently lead to the blackout.

The severe weather was also felt across the resources sector with South Australia’s largest mine, BHP’s Olympic Dam, forced to shut down operations. The company used back-up generators during that production halt before full power was restored a few weeks later.

However, the state suffered yet another power outage in December 2016, prompting the state government to drive a focus on energy security, with a $500 million incentive to increase energy security.

The funds were to be directed into building Australia’s largest battery to store wind and solar energy, and developing a 250MW gas-fired power plant as an emergency back-up power system, among other energy targeted initiatives.

In the middle of state government scrambling to find better energy security solutions, Tesla CEO and chairman Elon Musk tossed his hat in the ring, tweeting an offer to build a 100MW battery power system installed in 100 days or its free – further fuelling the energy storage debate.

Delta Energy Systems ANZ regional manager for industrial automation, David Bolt, said energy storage was one of the company’s main focuses from a long term direction.

Bolt said Australia is a ‘hot bed’ for such new exciting technology seeking both on-grid (utility scale) and off-grid (remote) energy storage systems as there was a strong interest in both markets.

He also highlighted that the company received more enquiries following Musk’s tweet.

“We’ve had so many enquiries ever since Mr Musk answered the ‘energy crisis call’,” Bolt told Australian Mining.

Bolt said Delta acquired Mitsubishi Heavy Industries (MHI) in 2016 to launch the company into the energy storage market. Delta now offer containerised lithium solutions up to 1MW in power output combined with bi-direction inverters (PCS) to manage energy flow between charging and dis-charge.

Bolt said the two key factors relating to the adoption of lithium energy storage were ‘peak smoothing’ in off -grid PV inverter applications and reducing the ‘spinning reserve’ amount (gas or diesel gen-sets) being utilised in remote applications where there is no reliable energy source.

While grid utility scale refers to the level of solar power supplied to the grid, peak smoothing refers to systems that smooth the peaks and troughs of large photovoltaic (PV) solar sites following cloud cover.

The smoothing system approach utilises the stored chemical energy in the batteries when the PV system is affected by cloud cover to even out the peaks.

“What they’re using the batteries for is for a giant capacitor which discharges that energy into the grid quickly when needed; smoothing the output,” Bolt said.

“The energy storage comes in and smooths all the peaks off and when cloud goes away, the solar system kicks back in again with any excess energy recharging the batteries”

What projects the company is working on

Delta is involved in remote applications in far to reach mine sites across Australia, as well as Samoa and the Marshall Islands. He said those islands, as well as the remote mine sites in the Pilbara, all use gas and diesel generators (spinning reserve) which contributes to the amount of carbon emissions they produce.

Because of these emissions, these remote locations are beginning to consider cleaner energy systems.

“What is making them look at energy storage and renewable isn’t the cost as much, it’s the fact that they’re getting charged on the CO2 output,” Bolt said.

“In Australia, for the majority of the major mine giants, every time they switch on that diesel gen-set they’re burning the diesel and they’re getting fined for the emissions, but that diesel gen-set has to stay on idle.

“So what’s pushing those companies to cleaner energy and energy storage is the fact that it doesn’t have any fine associated with keeping it operational. That’s the motivator for energy storage and pushing it on those remote applications.”

Bolt further explained the importance of energy storage particularly in remote areas like Samoa. For example, if these small islands do not receive 300,000 litres of diesel into their operating tanks because of adverse weather such as a typhoon, then energy storage combined with renewable technology’s such as hydro, wind, solar or even flywheels could be the solution for maintaining a sustainable energy source.

Utilities

Bolt described the utilities sector as an ever changing and fluid market.

He said that most large energy players were looking for other sources of energy that would take them into the future and were cleaner and more energy efficient as the market was currently “in a state of turmoil”.

Bolt also emphasised the importance of government incentives as a factor for helping reinforce cleaner, more efficient energy sources and to determine the long term future of the utilities market.

“Everything’s changing and we need to look at what’s a long term in terms of a stable supply and I think energy storage combined especially with solar can give that,” he said.

However, Bolt also emphasised the rather slow take up of energy storage with a variety of unknowns around the ever-changing technology.

“Right now the capital expenditure is still quite expensive for energy storage and the ROI (return on investment) isn’t as strong as it needs to be,” he said. “It is a dynamic, fast changing market however and the cost/kWh is getting to a much more cost effective target.

“At present the cost of running a diesel generator is around $160/kWh, the cost of energy storage is around $250/kWh. Note in 2010, deployed lithium energy storage cost was around $1000/kWh, 75 per cent more than it is today. When this meets parity and considering zero emissions, we have something much more attractive to off-grid and utility scale applications.

“We’re still at the beginning of the bell curve on energy storage – whereas the likes of coal and gas have always been there and the price of fossil fuels is in a state of flux right now with uncertainly on long term price. I think a lot of these energy companies need to make a step into a long term decision on what’s good for them, but we see a strong focus in the off-grid market at this stage where sustainable supply is critical.”

To keep up to date with Australian Mining, subscribe to our free email newsletters delivered straight to your inbox. Click here.