Thermal Energy Storage a Budding HVAC Option
The market’s set to grow from $3.67B in 2017 to $6.20B by 2022
Thermal energy storage has been a proven commodity for years in Europe, but the technology has seemingly been on the peripheral of the HVAC industry in the U.S. Now, energy storage is gradually stepping into the industry spotlight, and manufacturers are ready and willing to showcase their offerings in this important space.
In fact, according to a report published by MarketsandMarkets, titled “The Thermal Energy Storage Market, By Technology, Storage Material, Application, End-User, and Region - Global Forecast To 2022,” the market is expected to grow from an estimated $3.67 billion in 2017 to $6.20 billion by 2022, registering a compound annual growth rate (CAGR) of 11 percent from 2017 to 2022.
According to Steve Benz, a 35-year veteran of the thermal storage industry and Evapco’s director of global thermal storage and district energy, the genesis of today’s thermal energy storage market began in the 1980s, years after the Arab oil embargo. In the 1970s, many Americans experienced firsthand the painful vulnerabilities of energy dependence via this event.
Then came the economic boom of the early 1980s, which brought a new set of problems as electric utilities were unable to build power plants to meet surging demand for electricity. Energy rates increased sharply as a result.
Because of significant research conducted by Electric Power Research Institute (EPRI), electric utilities were encouraged to promote the use of thermal energy storage.
WHERE WE ARE
Mike Hopkins, CEO, Ice Energy, said energy storage has only entered the mainstream over the last four years. In that time, the technology has been adopted by businesses, homes, and utilities.
“Now you have policymakers wondering how to make this happen faster because it is so important,” he said. “It’s like what happened with renewable energy. That is the trajectory I see for energy storage generally. It will become more commonly accepted and costs will keep being driven down.”
The mainstream acceptance of energy storage, according to Hopkins, was spurred on by the state of California passing the Assembly Bill (AB) in 2013. Per the California Energy Commission, this legislation “was designed to encourage California to incorporate energy storage into the electricity grid. Energy storage can provide a multitude of benefits to California, including supporting the integration of greater amounts of renewable energy into the electric grid, deferring the need for new fossil-fueled power plants as well as transmission and distribution infrastructure, and reducing dependence on fossil fuel generation to meet peak loads.”
Hopkins said the legislation had an immediate impact there, and the decision got the attention of policymakers across the country. Now, the impact is being felt across the nation.
“Building owners and facility managers are facing mounting pressure to reduce electricity and water consumption to support corporate sustainability and environmental stewardship goals,” said Owen Smith, director of utility and grid solutions, Trane. “These challenges combined with regional water conservation regulations and the uncertainty of future energy prices spurred Trane to invest in thermal storage solutions to help its customers unleash the full potential of their buildings.
“Today, thermal storage systems are mature, cost-effective solutions that provide energy savings and operational flexibility,” continued Smith. “These systems will become increasingly valuable as renewable energy drives changes to the utility grid.”
The actual applications for energy storage have changed to a degree over time, but most manufacturers have chosen to expand offerings rather than change them entirely.
“In many ways, applications haven’t changed,” said Benz. “What has changed is related to the electric market — with an emphasis today on sustainable energy production and electricity storage. This has driven media attention. In many ways, its reduced attention on thermal energy storage because it’s considered ‘mature’ technology — it’s not ‘sexy’ anymore. When government dollars aren’t flowing, research and market interest is diverted, and that’s when the best and most viable, sustainable technologies lose.”
Smith said thermal energy storage is a mature, proven solution to sustainably cool a commercial building, and while the technology itself has not changed, Trane has adjusted its controls and schemes to address changes to utility rate structures.
“The increased use of renewable energy has shifted the focus of high-performance design to net zero-energy buildings,” said Smith. “When the sun doesn’t shine, thermal energy storage provides ample energy, which eliminates the need to take load off the grid. As a result, peak utility demands — and costs — can be reduced and properly managed. Trane anticipates this trend will continue across North America.”
Evapco’s latest core product was the Extra-Pak® ice coil technology with elliptical tube design, which was introduced in 1998.
“Since then, we have developed and introduced more advanced controls — like our ice thickness controller — to improve system operation and efficiency,” said Benz. “Our explanation is that the mature technology works and works optimally. This is a positive because the long track record of great performance points to superb, reliable, energy-efficient operation. If it hasn’t changed in all these years, we must be doing something right.”
Ice Energy’s latest offering is the Polar Bear, which provides energy storage for refrigeration.
“There are some changes in the controls [from the Ice Bear versions of the product], and we are adding a certain amount of glycol to water, which allows us to lower the freezing temperature of our thermal battery enough for refrigeration, supermarket displays, or process cooling situations,” Hopkins said. It’s a whole new market segment for us. This will be a new application with a continual demand and not just a seasonal load.”
Manufacturers tend to agree that thermal energy storage is on an upward trajectory with no clear signs of slowing down in the near future.
“If you read different reports about the market, you would consistently see the projections undershooting what actually happens,” said Hopkins. “I don’t know how long it will continue, but we are in a period of exponential growth, and I don’t see that changing over the next few years. This is overdue. I think there are great products coming out at great price points. People understand there are different technologies that have different attributes. Demand will grow, and products will become more optimized to specific applications. You will see continued growth in the market and eventually, years from now, it will level off, but that is a long time away.”
Benz believes demand for Evapco’s technology here in the U.S. will grow as the economy improves and demand for electricity increases.
“We’ve been stuck at less than 2 percent GDP growth in the U.S. for a decade,” he said. “If we achieve the Trump administration’s goal of 4 percent sustained economic growth, we will likely see higher demand for our technology as has been the case for us in places like China.”
Smith highlighted that renewable energy sources, like wind and solar power, are not always available.
“We must find a way to store and conserve it,” he said. This need will drive demand for thermal energy storage solutions in the future. Customers investing in 30-year assets want solutions that work today and can adapt to tomorrow’s modern electric grid.
“Right now, high-performance buildings can install transparent, functional energy storage to store energy when it’s readily available along with the ability to use that stored energy during peak periods,” Smith continued. “Customers want energy savings, cost savings, and the ability to adapt over the equipment’s life while being comfortable and productive.”
Publication date: 8/21/2017