Thermal Storage Solutions to Decarbonize Industrial Heat
By Felix Hennebert
Gigaton Potential
The emissions related to heat and power needs of heavy industry amount to roughly 12 Gt of GHG emissions per year. The biggest CO2 emitters in this sector include cement, steel, petrochemical, glass, ceramics, and refining industries. To meet the Paris Agreement's goal of limiting the rise in mean global temperature to below 2 degrees Celsius above pre-industrial levels, it is urgent to significantly reduce greenhouse gas emissions from heavy industrial applications. However, this is easier said than done.
For reference: in 2019, the world emitted 51 gigatons of CO2-equivalent greenhouse gases. Project Drawdown estimates we need to cumulatively eliminate 1,000 GT from 2020-2050 to keep global warming below 2 degrees Celsius.
What You Should Know
Challenges to Decarbonizing Industrial Heat
Traditional heavy industries rely heavily on fossil fuels due to their ability to generate high-temperature heat and power at a low cost for their processes. One alternative is to electrify those processes thanks to the rapid decrease in the cost of wind and solar. Unfortunately, two challenges remain.
Challenge 1: Intermittency of Wind and Solar
For the first time in history, power from wind and solar sources is now cheaper than from conventional sources like thermal and nuclear power plants in many parts of the world. This is an incredible opportunity for the energy transition! However, one main challenge in replacing fossil fuels with electricity from renewable sources like solar and wind is intermittency. The availability of sunlight and wind varies and hence the electricity production as well. On the other hand, industries have production lines running 24/7 and cannot afford from an economical and operational standpoint to only produce when the sun is shining or the wind is blowing.
Charging, storage, and discharging process of a thermal energy storage (TES) solution. Credit: Rondo Energy Inc.
Challenge 2: Fossil fuels are convenient and cheap
The second significant challenge in electrifying heavy industry is the convenience and affordability of fossil fuels. Fossil fuels, such as coal and natural gas, have dominated the industrial sector for decades for a good reason. They burn at high temperatures, providing the intense heat required for industrial processes, and are readily available at a low cost, especially in countries producing oil & gas like the United States.
Overcoming those two challenges involves delivering significant quantities of energy at high temperatures on a baseload basis (running 24/7) and at a cheaper cost than fossil fuel alternatives. This is the market that companies with thermal energy storage (TES) solutions are trying to disrupt.
Thermal storage solutions
Thermal energy storage is a key solution for transitioning heavy industry away from fossil fuels and reducing up to 12 gigatons of annual greenhouse gas emissions. Rondo Energy, a Californian startup, has, for instance, developed a thermal energy storage solution, the Rondo Heat Battery (RHB) that converts electricity from renewable sources like solar and wind into reliable heat and power for heavy industry. Here's how it works:
Low-cost, intermittent electricity turns into heat: Cheap, intermittent electricity is used to heat refractory bricks via electric wires. Those bricks are composed of Aluminum Silica, a material readily available at scale. This is the same idea as a toaster but filled with bricks instead of bread.
Thermal radiation warms bricks at temperatures up to 1,500°C, storing heat: The bricks are heated up to 1,500°C and can conserve the stored heat energy for days, with daily energy loss of less than 1% thanks to an effective insulation layer.
Heat is delivered on demand whenever it’s needed: When heat is wanted, air flows up through the brick stack. This superheated air can be used in two ways:
Process Heat: It can be delivered to industrial customers as high-temperature air, or converted to steam, replacing fossil-powered process heat without emitting greenhouse gases.
Heat and Power: the thermal storage unit can be used in a Combined Heat and Power (CHP) setup with an additional steam turbine to generate a baseload electricity supply as well as clean heat.
Charging, storage, and discharging process of a thermal energy storage (TES) solution. Credit: Rondo Energy Inc.
The storage material and thermal exchange processes vary between TES actors but the steps are the same: transforming renewable electricity into heat and delivering it at a specific rate via an energy storage medium. This simple but hard-to-implement solution is the key to providing cost-effective, low-carbon heat solutions and supporting the transition to a fully decarbonized world economy.
Benefits of thermal storage
The key advantages of this thermal storage approach include:
Cost-Effectiveness: The use of low-cost material as a storage medium and the efficient energy transfer mechanisms result in a competitive cost per stored unit of energy (kWh), making it economically competitive compared to traditional fossil fuel boilers.
High-Temperature Operation: The storage material is the same as has been used in steel furnaces for hundreds of years and has exceptional thermal stability. This allows operations at very high temperatures (up to 1,500°C), which is key for industries requiring intense heat.
Low Supply Chain Risk: The materials used in the main TES involve aluminum silica (basically dirt), carbon, volcanic rocks, or molten salt. All those materials are readily available at a low cost.
Easy Integration: Thanks to a modular design, those batteries can be built and integrated onsite without causing additional downtime.
Long Lifetime: The materials used in TES solutions often don’t change their chemical state and have a long lifetime of over 30 years. They don’t suffer from cycle degradation as is the case with lithium-ion batteries.
Improved Air Quality: Combustion-free heat generation eliminates NOx, SOx, and particulate matter caused by conventional boilers that cause respiratory disease, heart conditions, and prenatal issues, harming employee and community health.
Zero Carbon: This approach eliminates greenhouse gas emissions associated with heavy industrial heat processes, accelerating corporate decarbonization goals.
Key Players
Here are some of the main actors developing solutions to decarbonize industrial heat:
Rondo Energy offers Rondo Heat Batteries with storage capacities of 100 MWh and 300 MWh. These batteries utilize alumina silicate refractory bricks, allowing them to achieve high heat temperatures. With a 2MWh pilot project operational, this Californian startup raised an extra $60 million from notable investors including Breakthrough Energy Ventures, Energy Impact Partners, Microsoft Climate Fund, John Doerr, and other industrial players seeking clean heat solutions.
Antora Energy’s thermal batteries are charged using solar and wind electricity and utilize carbon blocks as heat storage material. In September 2023, this Californian startup launched its first pilot project in Fresno, California. Founded in 2017, Antora Energy is supported by investors such as Breakthrough Energy Ventures, Lowercarbon Capital, Shell Ventures, and others.
Brenmiller’s bGen TES units can be charged using excess renewable power and waste heat. The energy is stored in crushed volcanic bricks and can deliver heat up to 750°C. Brenmiller was founded in 2012 in Israel and is listed on the Nasdaq. It is targeting Industry and Utility applications with already four successful projects in operations.
Malta was established in 2018 as a spin-off of X, Alphabet's Moonshot Factory. The company, based in Massachusetts, specializes in the development and manufacturing of TES systems using molten salt. Their technology involves storing heat in a liquid salt, which can be released as needed. Malta has completed a pilot project and is currently focused on commercializing its technology for grid-scale energy storage applications. The startup has received support from investors such as Breakthrough Energy Ventures, Piva Capital, Chevron Ventures, and others.
Rondo’s 2MWh pilot unit in California. Credit: Rondo Energy Inc
Opportunities for Innovation
A few key opportunities exist to overcome the remaining challenges:
💲 Financial: Without a fixed price power purchase agreement (PPA), there are limited supporting market mechanisms that valorize flexibility. When they exist, those energy markets such as ancillary services or balancing markets, even though very profitable, are very unpredictable, and complicated. This unpredictability of the power price used to charge the TES batteries is a risk and increases the cost of financing the project.
🌱 Commercial: The TES industry is young and therefore suffers potential commercial risks. With no full-scale projects operational yet, the nascency of TES technologies is often seen as a risk-factor by potential users and investors.
🌐 Customer Awareness: Due to the industry’s nascency, there is a lack of awareness of the potential TES applications. This is further increased by the multiple use cases of TES solutions that can generate, depending on the setting, hot air, steam, or power.
🏗️ Renewable Energy Development and Grid Infrastructure: TES batteries require electricity to charge. New wind or solar assets are often challenging to develop and suffer from long permitting delays. When the carbon intensity of the power is low, an alternative is to charge the batteries directly from the grid. This accelerates the project development process but may also impose limitations in terms of available power, costly grid upgrades, and development delays.
The financial and commercial challenges are typical of early technologies and are addressed today thanks to clean energy grants for pilot projects and interesting tax credits available through the Inflation Reduction Act. Regarding renewable energy development, the US Congress and its administrations passed policies focusing on permitting reforms but more work is still needed at the state level to fasten the permitting process and upgrade the grid. The Inflation Reduction Act and the high gas prices in Europe act as a catalyst for the transition to clean heat solutions. However, this will require approximately an impressive 9,000 GW of extra renewable electricity to decarbonize all industrial heat with thermal batteries. As of the end of 2022, the total worldwide wind and solar capacity installed was 1,950 GW. So the road ahead is still long but the opportunity for growth is impressive.
Way Ahead
Given the industry's early stage of development, it is crucial to address its challenges and raise awareness about the applications and potential of TES solutions. Those include better rewarding flexibility, and reducing the technological and commercial risks associated with initial project investments.
But, with operational pilot units and full-scale TES projects being built, a race is underway among the startups in this field. As the business case against fossil fuels becomes clearer and the technology proves itself reliable, rapid scaling and delivery will be crucial in realizing TES's potential to decarbonize heavy industry.
Further Reads
The Financial Times, An ‘embarrassingly simple’ solution for industrial emissions, August 2023.
McKinsey, Net-zero heat: Long-duration energy storage to accelerate energy system decarbonization, November 2022.
Energy Innovation, Thermal Batteries: Decarbonizing U.S. Industry while Supporting a high-renewable grid, July 2023.
World Economic Forum, 3 reasons why decarbonizing industry might be easier than thought, May 2023
About the Author
Felix Hennebert is an MBA candidate at UC Berkeley, Haas. Prior to Haas, Felix, with his background in mechanical engineering, worked in the renewable energy sector. He first installed offshore wind farms in Europe and then specialized in energy markets in the optimization team of a large utility. Felix started at Haas with the idea of staying in the renewable energy sector but from an entrepreneurial perspective. Rondo’s elegant solution and brilliant team convinced him to intern there during the summer and to pursue research for them during his second year of MBA. In his free time, Felix enjoys discovering nature and the world, having a good time with friends, meeting new people, and exploring clean energy startup ideas.
Sources
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https://my.pitchbook.com/profile/459043-48/company/profile#timeline
https://bren-energy.com/
https://bren-energy.com/projects/
https://www.ft.com/content/7c6a0928-a233-4444-b294-297006270141
https://ourworldindata.org/grapher/installed-solar-pv-capacity
Take a look at Kyoto Group. Thermal Storage solution using mature technology and already commercially available.