"This is a very fast-growing market and a key element in fighting climate change, which is high on our agenda," says Hervé Amossé, executive vice-president energy storage solutions (ESS) division at Saft. Amossé joined the company three years ago after more than 15 years in the energy industry.
Saft is the world's leading battery developer and manufacturer, designing and producing batteries for more than 3,000 industrial customers worldwide. Established in 1918, it has set the pace for the development of changing technology in the sector for just over a century.
The renewables sector is driving the appetite for batteries for energy storage. "We're talking about triple digit growth to reach a market of 37 gigawatt hours (GWh) by 2025. That's equivalent to the energy needs of 11 million homes per year," explains Amossé, "The good news is that the growth in energy storage is sustainable thanks to the transition to renewables. Such a scale effect will enable us to reach $100 (USD) per kWh by 2025. We started at $1000 an hour in 2010, so we're talking about a tenfold reduction if we come in on target. These are really exciting times for ESS."
Saft holds a commanding position in all its major markets; from aviation and rail, to defense and space. In 2019, the company had a $1 billion (BN) turnover, about 12% of which has been reinvested in R&D.
Total acquired Saft in 2016. "That has enabled us to accelerate in the ESS market where we are shifting from the niche for relatively small players in the frequency regulation space, to becoming a global player looking to further develop our solutions for customers in the U.S., Southeast Asia and Europe," he continues.
A symbiotic working relationship
Becoming part of Total has enabled Saft to accelerate in developing strategic relationships and creating partnerships in bigger markets, like China. As of November 2019, Saft has a 40% shareholding in a joint venture with Tianneng Energy Technology to push forward with lithium-ion development, production and sales. The partnership also means expanding manufacturing operations at the Changxing Gigafactory, west of Shanghai.
"Total is also a customer of ours. We work with Total Solar International (TSI), Total Eren and Total Quadran — all renewable energy developing entities. This is really interesting from a business standpoint; it means we regularly get their feedback on our products. Total systematically puts us in competition for tender to make sure they are getting the best price!" he smiles.
One such project, France's largest lithium-ion energy storage system to date, will be up and running close to the port city of Dunkirk by the end of 2020. The site was previously one of the Group's refineries; it closed in 2010 to make way for a fuel depot. With the site still connected to the grid, Total saw an opportunity to launch energy storage activity there.
Now, 11 of the latest high-performance Intensium® Max 20 High Energy storage solutions will be installed in Dunkirk, taking the project to an industrial scale. The project was developed by Total Solar International (TSI) as part of a portfolio of 103MW capacity, attributed to Total in early 2020 through a tender by the French transmission system operator RTE. The Energy Storage System (ESS) Team of TSI develops and builds ESS projects in France and internationally for various grid and renewables stabilization services. At Dunkirk the main application of the battery will be capacity provision to the French grid during congestion periods over the winter as well as ancillary services to the grid. The project is also supported by the local region, bringing new life to ESS in France with a storage capacity of 25 megawatt-hours (MWh) and output of 25 megawatts (MW) of power.
Dunkirk is a landmark operation for Total and a second phase, already in the planning, would see a doubling of capacity here. If all goes according to plan, similar scaling on other sites in France as well as in Spain and Belgium are not far off.
With significant input from Saft on energy storage, the Group is building a portfolio of power and renewables operations with the objective of seeing them account for up to 40% of its sales mix by 2050.
Demand for energy
Global demand for electricity is expected to double between now and 2040. The International Energy Agency's Sustainable Development Scenario has renewable energies accounting for close to 30% of the energy mix by then. As the world wakes up to the reality of climate change, renewables are taking center stage.
The main sources of clean energy, the sun and wind, are unpredictable and often unstable. "The sun shines and wind blows but not always at the point of high consumption. You need to balance consumption and production, put energy into the battery and use it later. Shifting power to the grid when demand is high and stabilizing it are the two main ESS applications," explains Amossé, "Wind and solar energy entering the grid network can be intermittent increasing the risk of a black-out, and no one wants a blackout."
The continuing development of renewables needs flexible electricity storage options. Saft has always prized research very highly, it has two main research centers: one in Bordeaux, France and a second in Cockeysville, Maryland in the U.S. The year 2000 marked the beginning of R&D in the storage of renewable energy; looking for new technologies which would be safe and reliable, while outperforming the competition.
"Since 2012, when our ESS products really started coming onto the wider market, we have seen huge growth and we are making continual improvements to our offerings," he says.
Close collaboration with customers is key, particularly when it comes to money. "Our number one challenge is cost, and the total cost of ownership for our customers. Seeing as we sell most of our projects to renewable developers the return on investment is critical and the less CapEx they can put in the better," he goes on, "With this in mind, we have worked hard on new products which are offered at a market price aligned with what large suppliers/competitors from Korea or China are offering."
Extensive global reach
Saft has successful renewable storage projects running from the tundra of the Arctic to the Australian Outback. Optimizing wind and solar power, as well as providing backup and black start capabilities.
One customer operating in tough environmental conditions is TuuliWatti in Finland, who chose Intensium® Max 20 High Energy for their sites. "TuuliWatti wants to become the main power supplier in the Arctic region. It is a leading developer of wind power and really active when it comes to ideas for mitigating climate change. The team is already running 11 sites in northern Europe and wanted to back up supply on 3 sites with ESS," says Amossé, "The latest frequency regulation technology injects energy to compensate for the constant changes of the wind farm power output. They needed faster response times to the challenges they face up there."
Different but nonetheless tough conditions in the Australian bush, 982 kilometers northeast of Perth, also call for an energy storage solution. The remote off-grid location of the Agnew Hybrid Renewable Microgrid means it has to generate its own electricity. Saft's lithium-ion battery ESS is now an integral part of the country's largest hybrid renewable energy microgrid, as well as being the first to incorporate wind power at a mining site on such a large scale.
Last but not least, TSI plans to develop projects combining solar and storage in the U.S. Where Saft will be a preferential partner.
Future energy strategy
The demand for flexible ESS can only increase, as more customers come to rely on renewables for their energy needs. That means providing a holistic ESS, more than just a battery. "We have an offer which starts from the battery itself where we can store the energy and bring it back to the grid when required. But of course, you need to be connected to the grid for such an option to work," Amossé emphasizes, "So we offer not just the battery, but all the connections required to connect the battery to the grid. That is a solution we sell to renewables developers like Total Solar, Total Eren and Total Quadran or directly to utility providers. Those providers might be very large size utilities at high voltage grid level, or microgrid customers, who have a small grid which can be used to bring power to remote villages, communities, military bases and so on, places that want autonomy over their source of power."
Total Saft's range of products is in constant evolution, with a development strategy sharply focused on end user needs. "We will be updating products every 12-18 months on average. The products we are releasing now are first versions, the good news is that costs will drop as the renewables market evolves. We are building products and a roadmap to serve our customers for the next generation."