Compressed Air Energy Storage

Given that the two least expensive forms of renewable energy (solar PV and wind) are variable in nature, common sense tells us that large-scale storage of energy will be required if we are to have large rates of integration of these resources into the grid mix. (For what it’s worth, not everyone agrees with this, as I noted here.) But in any case, the world is working hard to bring along a number of modes in which large amounts of energy can be stored during periods of reduced load, and then brought on the grid to address peak conditions.

Of course, there are many such approaches to make this happen, the most common of which is pumped hydro, which comprises well over 95% of all storage in the U.S. at the current moment.

To cut to the chase, here’s an article about compressed air energy storage (CAES), and a merger between two large players that will accelerate its implementation.  The concept is simple: some sort of closed cavern, perhaps a depleted natural gas site, is charged by pumping air in, and discharged by releasing the air. Yet as simple as this solution may be, there are only two implementations of the concept on the planet (one in Alabama, the other Germany).

I bring this up because one of my colleagues, Joe Spease (pictured), is busily at work trying to finalize his plans to build plants in Texas and Kansas (associated with some new wind farms in these areas), and the numbers associated with the IRR (internal rate of return) of the projects look quite appealing. Investors will be further encouraged by the article linked above, and the knowledge that this technology is really starting to take root.

I encourage accredited investors with an appetite for clean energy who may have an interest to contact me, and I’ll arrange a conversation with Joe.