Estimating the capital costs of energy storage technologies for levelling the output of renewable energy sources

In remote areas and islands north and west of Scotland and in many other parts of the world, the high cost of connecting wind farms and other renewable energy converters to the grid may make energy storage an attractive alternative. We estimated the installed capital costs of advanced adiabatic compressed air storage (ACAES), vanadium redox flow cells (VRB) and Li-ion batteries in
the range of 0.5–50 MW and 0.7–30 MWh. These costs were all of the order of £1 million per MWh, confirming that they already compared favourably with that of network improvements and connection to mainland. VRB and Li-ion batteries had similar capital costs, with VRB being more competitive at lower power output and higher energy storage. Cost reductions of 30–50% would be required for ACAES to be competitive, which may be achieved by the use of reversible compressors that can also be operated as expanders.