Comparing the cost of thermal energy storage to lithium-ion batteries reveals several key points:
Cost Overview:
- Thermal Energy Storage (TES): The cost of thermal energy storage systems varies significantly, but they are generally competitive with lithium-ion batteries for long-duration applications. According to a report by BloombergNEF, the global average capex cost for thermal energy storage was around $232/kWh, making it the cheapest option for durations over eight hours. Another analysis suggests a range of $350/kWh for a 10% internal rate of return (IRR) with potential costs as low as 5-10 cents per kilowatt-hour thermal (kWh-th) under certain conditions.
- Lithium-Ion Batteries: The cost of lithium-ion batteries, particularly for short-duration applications, has seen significant reductions. For four-hour discharge cycles, lithium-ion batteries typically cost around $304/kWh.
Comparison Points:
- Application Suitability: Thermal energy storage is well-suited for industrial and residential heating applications and can provide long-duration energy storage, which is advantageous for balancing energy demand when renewable sources are not available. Lithium-ion batteries are versatile and commonly used for both short- and long-duration energy storage across various applications, including electric vehicles and residential battery systems.
- Cost Efficiency: Thermal energy storage can offer significant cost savings, especially in industrial applications where process heat is needed, achieving savings of up to 150% compared to traditional methods. Lithium-ion batteries have also seen significant cost reductions due to economies of scale and technology improvements.
- Scalability and Durability: Thermal energy systems can be designed for large-scale deployment, offering advantages in terms of scalability and potentially lower costs per unit energy stored for long durations. Lithium-ion batteries are well-established and widely scalable, with their cost-effectiveness bolstered by the electric vehicle industry.
Conclusion:
Thermal energy storage is competitive with lithium-ion batteries, especially for long-duration storage needs and specific applications such as industrial process heat. However, lithium-ion batteries continue to dominate shorter-duration applications due to their versatility and rapid cost declines driven by large-scale production for the automotive sector.
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