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Cooper Katz McKim

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Planet Money

Re-imagining the energy grid ... through batteries (Two Indicators)

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We're going to have to figure out how to store it.

Planet Money

Re-imagining the energy grid ... through batteries (Two Indicators)

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That this was just pie in the sky. This is not real. Like another California pipe dream.

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When Batteries Get A Face Lift, So Do Renewables

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More and more was added in 22, 23, and it really took off, particularly in California. To see it for myself, I showed up to a site called Cal Flats in Central California. It's this 2,900-acre plot of land just covered in solar panels. There's, like, goats running around. There's little fox habitats.

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When Batteries Get A Face Lift, So Do Renewables

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The extra energy generated from all that solar flows straight into batteries right on site.

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When Batteries Get A Face Lift, So Do Renewables

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That's Justin Johnson, the COO of Arivon, the company that owns Cal Flats. When we talk about battery storage, this is what people are referring to. Rows and rows of stacked battery suitcases, basically, in a container that's like eight feet high, basically a cabinet.

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When Batteries Get A Face Lift, So Do Renewables

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So the site has enough storage capacity to provide electricity to around 60,000 homes for a few hours.

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When Batteries Get A Face Lift, So Do Renewables

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Yeah, it's a lot. Erevan sells that energy to Apple and PG&E, the state's largest utility. Justin Johnson says there is no shortage of customers, though.

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When Batteries Get A Face Lift, So Do Renewables

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Right. But there were still a few questions that I wanted to dig into. So, Emily, today on the show, we tackle the technological reasons behind batteries taking off so fast and what's next for them.

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When Batteries Get A Face Lift, So Do Renewables

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Yeah, I mean, it's not like one day some company said we're going to make batteries powerful enough to support the grid. That would have been awesome, but it kind of has to go back a ways. The batteries I saw on Cal Flats, it arguably goes back to the 90s when Sony introduced their camcorder with a little rechargeable battery inside of it.

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When Batteries Get A Face Lift, So Do Renewables

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Dan Walter studies the rapid growth of electrotech-like batteries.

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When Batteries Get A Face Lift, So Do Renewables

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Right. It's kind of satisfying to click in at that one.

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When Batteries Get A Face Lift, So Do Renewables

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We've all definitely used those batteries at some point. That's basically at the root of what Dan calls the battery domino effect.

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When Batteries Get A Face Lift, So Do Renewables

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Oh, Emily, hi. That's just me turning on and off the lights at a facility in California where there is battery power energizing the grid. Like literally holding energy and then releasing it onto the grid that powers all our homes.

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When Batteries Get A Face Lift, So Do Renewables

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Over time, people wanted longer-lasting and cheaper batteries, so companies had an incentive to develop them.

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When Batteries Get A Face Lift, So Do Renewables

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Yeah. And the whole story starts over as another sector finds use for that same battery from camcorders to laptops, e-bikes, three wheelers, cars. Each sector is full of people who want better batteries and will pay for it.

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When Batteries Get A Face Lift, So Do Renewables

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Yeah, that's a perfect transition to Dan's second point because the growth of EVs is a big part of this story. Long before others were investing in battery storage like back in the aughts, leadership in China saw an opportunity with the technology and became a hub for manufacturing batteries. It wasn't a big market yet, but they saw an opportunity. Wow.

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When Batteries Get A Face Lift, So Do Renewables

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And as EVs got more popular, it drove the volume of larger, lighter, denser batteries way up. That made batteries way cheaper.

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When Batteries Get A Face Lift, So Do Renewables

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Since 2010, the average cost of batteries has fallen more than 90%, which is one of the fastest cost drops of any energy technology ever. It's grown into new markets, new countries. And by 2021, battery storage finally reached that tipping point in the U.S., where they were literally contributing electricity to the entire grid.

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When Batteries Get A Face Lift, So Do Renewables

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Never let it go. Yep, exactly. Now, you remember the battery I mentioned earlier?

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When Batteries Get A Face Lift, So Do Renewables

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That was a game changer for battery storage because it used lithium-ion technology, which was way more energy-dense than what we had, nickel-cadmium or lead-acid batteries.

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When Batteries Get A Face Lift, So Do Renewables

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Meaning lithium-ion batteries can hold a charge for longer. They're lighter. It can be recharged a lot more time. It's more energy-efficient.

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When Batteries Get A Face Lift, So Do Renewables

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Yeah, it's a good question. I mean, for one, they're incredibly light compared to nickel or lead. It also gives up its electron really easily, which is important given that a battery works when electrons flow from the negative electrode to the positive one.

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When Batteries Get A Face Lift, So Do Renewables

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We should just use lemons to power our grid. What are we doing?

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When Batteries Get A Face Lift, So Do Renewables

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Grid-scale battery storage is surprisingly oftentimes the second largest source of energy on a given day in California.

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When Batteries Get A Face Lift, So Do Renewables

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Exactly. And as these batteries became more advanced, new types of lithium ion batteries came about. So there's lithium iron phosphate battery, for example, which is cheaper and less flammable than its precursors. It's also less energy dense, but it's low cost made that worthwhile.

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When Batteries Get A Face Lift, So Do Renewables

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The batteries at Cal Flats, for example, are LFPs, this lithium iron phosphate, and they can hold like four hours of energy.

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When Batteries Get A Face Lift, So Do Renewables

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Yeah, and the domino effect and an affordable, powerful chemistry for batteries have allowed this technology to grow exponentially.

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Well, forever, I don't know. But analysts like Dan Walter definitely see the dominoes continuing to fall for the foreseeable future. He sees battery storage advancing from cars and the grid to maybe even, like, freight ships, even planes.

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When Batteries Get A Face Lift, So Do Renewables

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I mean, just a few years ago, it was unimaginable. Grid-scale storage like this, it was basically a dream technology for renewable companies, a what-if scenario.

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This plane, it's on an upward trajectory, and so is battery storage. It's really in that position to be disrupted further, and likely through new chemistries. For example, sodium ion batteries are still a young technology, but they're projected to follow in the footsteps of LFP batteries.

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Sodium ion batteries are even cheaper than LFPs in part because they rely less on critical minerals. But also sodium is just kind of everywhere. It's literally a thousand times more abundant than lithium. And these batteries don't perform as well as LFPs. But the market could say we'll take lower performance at that cost.

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The other benefit of sodium ion batteries, they're less taxing on the environment. So sodium is so abundant, there's less pressure to dig deeper and deeper or into far flung places of the world. They also don't rely on minerals like cobalt or nickel, which are both known for being super water intensive and having polluting mining processes.

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So there are some versions that can go for days. And one of those is the Redox Flow battery, which is currently used on a much smaller scale. But it could change the story from just four hours to daily or even multi-day capacity.

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It really would redefine how batteries are made. Inside each battery, there are two electrodes that we talked about, the cathode and the anode. And in between them, there's liquid. Whenever electrons move from one side to the other, there's an automatic discharge. And with the Redox Flow battery, those two sides are completely separate. So it can maintain a charge way better.

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It's grown fast. By 2030, some forecasts have capacity increasing by like 400% and it's already high. So all this, it's very exciting to Dan Walter.

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If the wind doesn't blow, exactly. And battery storage, it changes that equation.

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When Batteries Get A Face Lift, So Do Renewables

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And then tap into it whenever it's needed. Well, that dream tech is now very much mainstream. around 2020 to 2021, battery storage capacity jumped 230% across the U.S.