Nickel 28 Capital Corp.
Suite 5300, TD Bank Tower,
Box 48, 66 Wellington Street West, Toronto, ON M5K 1E6
info@nickel28.com
US Battery Storage to Reach New Heights In 2019
With so much focus on EVs, it’s easy to forget about the growing behemoth known as the energy storage sector.
Recent analysis by Wood Mackenzie Power & Renewables and the Energy Storage Association (ESA) shows the deployment of energy storage installations in the US alone doubled in 2018, with 2019 set for another doubling of deployed capacity.
The research found an 80% year-on-year jump in deployed storage capacity to 777 megawatt-hours (MWh) of capacity in 2018, with the forecast calling for 1,681MWh of grid-connected storage to be deployed in the US alone in 2019.
The US residential storage market quadrupled in 2018 year-over-year.
The researchers credit policy intervention at the state level for most of the growth. They point to a series of gubernatorial, legislative and regulatory actions aimed at unlocking the potential of storage, specifically to create a more resilient, efficient, sustainable and affordable electricity grid.
Incorporating energy storage in utility planning processes was another key US policy theme for 2018, with the National Association of Regulatory Commissioners adopting a resolution calling on utilities to include storage in long-term planning efforts. At the federal level, the Federal Energy Regulatory Commission’s landmark and bipartisan Order 841 provided a critical policy signal that triggered discussions on breaking down storage deployment barriers in regional markets.
The report noted 311MW of energy storage were deployed in the US in 2018, with Front of the Meter (FTM) accounting for 47% in megawatt terms.
Critically, more Behind the Meter (BTM) storage was deployed in 2018 in the US than any previous year on record, accounting for 53% of the megawatts deployed in 2018. The US BTM market is expected to pick up an increasing share of overall storage market value and is expected to account for more than half of annual market value in dollar terms by 2021.
Indeed, during 2018, several utilities initiated programs to explore the use of residential storage for grid services, opening a new chapter in residential storage where market players can access diverse new revenue streams beyond backup power, the ESA said.
2018 was also marked by battery supply shortages, as manufacturers committed capacity to the South Korean market to take advantage of incentives.
Consequently, US storage system price declines slowed in 2018, with some products even seeing slight price increases. These shortages are expected to be short lived and to decline from the end of the March-quarter, as several Tier 1 battery vendors bring new production capacity online.
The researchers expect battery-rack prices to fall below US$150/kWh over the next five years.
WoodMac estimates that the annual value of the US energy storage market will exceed $2.4 billion in 2020, rising to $3.8 billion by 2023 as falling costs and favourable policies drive new demand.
This all bodes well for technology metals such as cobalt, graphite and nickel, all of which are needed to make lithium-ion batteries – the current, undisputed leader in the race for dominance as the commercial technology of choice for grid storage.
Yes, vanadium-flow batteries have been catching up, however, that particular tech continues to play second fiddle by a very large margin, since today’s world is a lithium-ion world. Lithium-ion batteries will continue to dominate the grid-storage mix for at least the next decade, if not longer, given the incredible amounts of capital flowing into lithium-ion battery mega-factory build-outs happening in the US, Europe and especially in Asia.
I invite investors to get in touch with any questions.
Anthony Milewski, Chairman of Nickel 28
About Anthony Milewski
Mr. Anthony Milewski has spent his career in various aspects of the mining industry, including as a company director, advisor, founder and investor. In particular, he has been active in the commodities related to decarbonization and the energy transition, including nickel, cobalt, copper and carbon credits. Anthony has served on the London Metals Exchange Cobalt Committee, which includes representatives from the largest mining and commodities companies globally, to represent the interests of the industry to the board of directors the LME. Mr. Milewski holds a B.A. in Russian history from Brigham Young University, an M.A. in Russian and Central Asian Studies from the University of Washington, and a J.D. from the University of Washington. Anthony Milewski has been interviewed by numerous Media outlets, including BNN, The Financial Times, Bloomberg, The Northern Miner and many others. Most recently, Anthony Milewski has written op-ed articles for leading mining publications including The Northern Miner.
Forward-Looking Information: Some of the posted entries on the CEO Corner may contain forward-looking statements. Forward-looking statements address future events and conditions which involve inherent risks and uncertainties. Actual results could differ materially from those expressed or implied by them. Examples of forward looking information and assumptions include future estimates of the worldwide supply and demand for nickel and other metals and the effect that these changes could have on the short term and long term price of nickel and other metals on the world markets, statements regarding the future operating or financial performance of Nickel 28 including the net present value, metal recoveries, capital costs, operating costs, production, rates of return and payback. Forward looking statements involve known and unknown risks and uncertainties which may not prove to be accurate. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Among those factors which could cause actual results to differ materially are the following: market conditions and other risk factors listed from time to time in our reports filed with Canadian securities regulators on SEDAR at www.sedar.com.
In some cases, forward-looking statements can be identified by terminology such as "may", "will", "should", "expect", "projects", "plans", "anticipates" and similar expressions. These statements represent management's expectations or beliefs concerning, among other things, future operations and various components thereof affecting the economic performance of Nickel 28. Undue reliance should not be placed on these forward-looking statements which are based upon management's assumptions and are subject to known and unknown risks and uncertainties, including the business risks discussed above, which may cause actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Accordingly, readers are cautioned that events or circumstances could cause results to differ materially from those predicted.
Links: Some of the posted entries on the CEO Corner may include links to 3rd party websites. Nickel 28 has not reviewed all websites linked to or from this Site and is not responsible for the contents of any such websites. The inclusion of any link does not imply endorsement by Nickel 28 of the linked website or its content. Use of any such linked website is at the user's own risk.
For further information we refer you to our legal notice.