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| By Chris Graebe |
The shift away from fossil fuels has happened, and there's no turning back.
In 2023, renewable sources accounted for 86% of total global power system growth.
Today, the renewable energy market is now estimated at $1.2 trillion. And this figure is only set to grow as governments worldwide push for a zero-emissions, carbon-neutral future.
However, renewable energy is not without its issues.
Suppose the sun's rays are the only thing powering a city. During nighttime or periods with thick cloud coverage, there may not be enough energy to go around.
This is why it's so important for grids to store the energy harvested during ideal conditions to use later in less-than-ideal conditions. This is where grid storage solutions come into play.
The Real Bottleneck in Green Energy
The U.S. power grid’s health is in question as weather-related blackouts overpower it regularly.
So, large-scale energy storage solutions are essential for making the most out of the renewable energy we harvest.
This ability to collect and store energy for the longer term gives us a buffer zone between what Mother Nature provides and what populations demand. Doing this at a large scale is difficult. And we are only in the early stages of being able to do it effectively. Meanwhile, our appetite for power only grows stronger.
Energy demand has been fairly flat for the past two decades. But with AI, cryptocurrencies and quantum computing, global energy consumption is set to surpass any gains in efficiency by 2050.
This isn’t a future problem.
Consider that a single ChatGPT search is equal to leaving a lightbulb on for an hour. And it takes many tries to get the output you want.
Now consider that ChatGPT recorded some 3.8 billion visits in January alone. As more people start to use AI chatbots, you see where this trendline is going!
Even if we could gather all the energy we can now, pure electrical energy can’t actually be stored. An electrical current is just electrons flowing between atoms.
This is why energy that isn’t used needs to be either dissipated or saved in a different form, like a battery.
Batteries aren’t just an important technology for EVs or smartphones. They are increasingly essential for powering cities, homes or even just flipping on a light.
In the future, vast networks of cost-effective, clean and efficient batteries will be used in almost all power grids.
Market Growth & Emerging Trends
In 2023, global renewable energy grew by 473 gigawatts. That’s enough energy to power roughly 384 million American homes for a year.
This growth marked the largest increase in renewables to date.
According to the International Energy Agency (IEA), grid-scale batteries will account for the majority of energy storage growth worldwide.
IEA research shows that, between 2021 and 2022, grid storage installations rose by 75%. And nearly all the infrastructure that existed in 2022 was made within the previous six years.
As energy collection infrastructure grows, energy storage needs to grow with it. Not only is demand rising for higher grid capacity and new solutions, but the current infrastructure is aging out and will need to be replaced.
Lithium-ion batteries, the most common storage solution on the market, typically last up to 10 or 15 years before needing to be replaced.
Lead-acid batteries, the second most popular solution, have even shorter lives, typically around five to 10 years.
This aging infrastructure is why governments, firms and private investors are funneling billions of dollars into this space in an attempt to prepare for future demand.
And a lot of that is going to private companies with unique and groundbreaking technologies. Firms like …
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Hydrostor recently secured $200 million in funding from investors — including Goldman Sachs — for its patented solution that uses compressed air and water to store renewable energy.
This solution is emission-free, cost-effective and flexible. A plant can be set up just about anywhere to capture surplus or renewable energy and then release it after hours or even days to smooth out the energy supply to an area.
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Form Energy is pioneering iron-air battery technology that can store energy for up to 100 hours.
Founded in 2017 by a team that includes the former head of battery development at Tesla and an MIT professor, the company is reimagining a technology once explored by NASA in the 1960s.
Form Energy seeks to prove NASA wrong and has already secured $405 million of aid from investors in the process. If all goes according to plan, this will be the first commercially available iron-air battery ever made.
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Energy Vault (NRGV) has pioneered a way to store energy using what’s known as a gravity battery.
Gravity batteries work by using excess energy to hoist heavy blocks into the air, converting electrical energy into potential energy.
When the energy is needed, the blocks are lowered and their downward movement drives generators which produce electricity.
Unlike chemical batteries, this technology can store energy for an extremely long time without losing potency. Once the weights are lifted their potential energy remains the same indefinitely until they are lowered.
Energy Vault earned $110 million from the SoftBank Vision fund — the first-ever energy storage investment by the firm — and was named Technology Pioneer by the World Economic Forum and went public through a SPAC merger.
Investors who got into Energy Vault before it went public made money.
Unfortunately for those who didn’t, its post-IPO performance looks a LOT different …
That’s why I’m looking at companies that are still private to invest in this essential industry.
And I recently found one that is ready to meet this important moment … and the demand we just talked about.
In the coming days, I’ll reveal a startup that operates in the energy sector to my Deal Hunters Alliance Members.
Its technology has major implications for the future of energy systems and could be the next in line for a major investment from Goldman Sachs or SoftBank or to go public on its own.
To find out more click here.
Happy hunting,
Chris Graebe
