The rapid spread of wind and solar power has ignited a race to experimentally capture and store that energy. Several Houston startups say they've developed ways to store energy underground, and one just announced its first commercial project.
Sage Geosystems called the project “the first geothermal energy storage system that stores potential energy deep underground and supplies electrons to the electric grid” in an August 13 announcement. The company plans to install the system next to a solar farm in South Texas.
Energy storage allows excess electricity to be saved for periods of low generation, so that, for example, solar power plants can run cities at night. This race has largely spawned the explosive growth of lithium-ion battery technology and markets, and a global scramble for the rare earth minerals they require. But on the fringes, a proliferation of start-ups hopeful that emerging technologies will meet the storage needs of a new generation.
Many energy storage technologies, such as compressed air energy storage, hydrogen-based systems and various forms of thermal storage, are still in the early stages of development, and researchers and investors are not sure which technologies will ultimately be viable in terms of cost and ease of use.
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In recent years, Texas has quickly become the nation's largest producer of renewable energy and also the largest market for large-scale energy storage.
“There's a growing need for technology that can adjust generation levels to maintain grid stability,” said Yiyi Zhou, an energy analyst at BloombergNEF. “The technology Sage is developing could be a game-changer.”
Sage isn't the only startup working in this space: Two other Houston-based companies, Fervo Energy and Quidnet Energy, are also claiming proprietary technologies they plan to use to store and generate geothermal energy. All three companies plan to inject water under high pressure underground.
Here's how the system works: Electricity from solar farms, wind turbines, and other renewable sources is used to pump water into specially created underground caverns and reservoirs, where the water is stored under pressure. When electricity is needed, valves sealing the underground caverns open, sending the pressurized stored water back up to the surface, where it spins turbines that generate electricity.
“This form of pressurized water storage is very novel and, as far as we know, companies such as Sage Geosystems, Quidnet Energy and Ferbo Energy are pioneering this new technology,” said Chetan Krishna, head of research and development at climate-focused startup accelerator Third Derivatives.
Pressurized water is an old idea; the innovation, Krishna said, is the process of creating an underground reservoir to store it. Traditional geothermal energy projects typically require natural underground cavern systems, but these companies can create their own caverns almost anywhere, he said. In addition to energy storage, all three companies also want to develop geothermal power generation using the same technology.
Sage's lead geologist, Mike Eros, says the process, which the company calls geopressured geothermal systems (GGS), is similar to hydraulic fracturing for oil and natural gas, but on about one-tenth the scale and intensity: Instead of an array of compressors, it uses heavy mineral mud, wide wells and gravity to create vertical fractures in rock thousands of feet below the surface.
The system uses excess renewable energy from solar, wind and geothermal power to inject water into these cracks at high pressure and release it when needed. Eros says the system can store energy for up to 10 hours at 75 percent efficiency, and can spray a nine-inch stream of water at 5,000 pounds per square inch of pressure to spin a generator turbine.
“We call it the 'Earth Battery,'” says Eros, who worked for ExxonMobil for 12 years. “It's compressed water energy.”
He said the main risks with the system are groundwater contamination and the development of “runaway fractures” in the earth. Sage has taken precautions to mitigate those risks, including detailed geological mapping to avoid injecting into existing faults, Eros said.
In a related move on Monday, executives from Sage and Facebook parent company Meta, as well as officials from the U.S. Department of Energy, announced that the companies will use Sage's GGS technology to generate geothermal energy “virtually anywhere.”
“Hot rocks are an extremely abundant resource compared to traditional hydrothermal formations, and Sage's GGS technology is a highly scalable approach that has the potential to expand rapidly in the U.S. and around the world,” the companies said in a joint press release following presentations at the DOE's Next Generation Geothermal Development Acceleration Workshop in Washington.
The companies said Meta plans to use Sage's GGS technology to “provide carbon-free power for Meta's data centers,” but did not say where.
The first commercial project using GGS for geothermal energy storage will be built on land leased from San Miguel Electric Cooperative in Christine, Texas, and connected to a solar farm there, allowing Sage to buy peak power, store it, and sell it back to the grid at night.
Unlike Sage's announced plans for geothermal power from Meta, the first storage project will only use pressure because “you have to walk before you can run,” Eros said. Later, more advanced storage efforts will also use geothermal heat, he said.
Ultimately, the economic viability of these systems will depend on how their cost compares with the most popular new form of energy storage: lithium-ion batteries.
Five years ago, lithium-ion batteries accounted for less than 4% of energy storage in the U.S. With millions of batteries installed in June, they account for more than 40% and could surpass 50% by the end of the year, according to Department of Energy data.
Batteries complement the most traditional energy storage method, called pumped hydro, in which water is pumped uphill during peak generation times and then released back downhill to power turbines at times of peak energy demand.
But storage duration is a limiting factor for batteries: Most utility-scale batteries in the US are best suited for up to four hours of storage; newer systems can provide six to eight hours of storage, but at higher costs.
These technologies will ultimately be evaluated based on a metric called the levelized cost of storage. Lithium-ion batteries can provide six hours of storage at an average levelized cost of $72 per megawatt-hour, according to calculations by the Third Derivative accelerator. Meanwhile, Sage claims that when combined with solar power, it can provide up to 10 hours of storage for $100 per megawatt-hour.
“This is certainly better than the status quo for lithium-ion battery storage,” said Ramanan Krishnamoorthi, vice chancellor for energy innovation at the University of Houston. “This company has clearly made a breakthrough here.”
It's unclear whether the storage technology will be able to survive in the market. Krishnamoorthi said lithium-ion batteries are improving rapidly, and researchers are developing alternative materials that could dramatically change the game. Still, there may be room for multiple systems in the burgeoning energy storage market.
“Each will be an important contribution to solving our energy storage needs,” said Lisa Biswal, associate dean of the School of Engineering at Rice University in Houston. “As a researcher in the energy field, I'm excited to see commercial deployment of not only geothermal but also grid-scale lithium battery systems.”
Researchers and investors are watching to see whether Sage's planned storage times and costs will materialize in its first commercial project, after it demonstrated the technology in a non-commercial pilot last year.
“This technology has only become practical in the last few years,” said Ken Withian, associate director of the University of Texas Bureau of Economic Geology, which has worked with Sage on previous projects. “The main hurdle is getting the first commercial projects up and running.”
If the project is successful, Withian suggested that geothermal energy storage could be adopted just as quickly as wind, solar and battery projects have been adopted in Texas recently.
“What started as very little interest suddenly became a commercial project in a short space of time,” he said. “One of my dreams would be to see these energy storage wells drilled next to every wind turbine in the state.”
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Dylan Badour
Reporter, Austin
Dylan Badour covers energy and environmental justice for the state of Texas. A native of Houston, he has worked on the business desk of the Houston Chronicle, covered the US-Mexico border for international media, and reported from Colombia for several years for outlets including The Washington Post, BBC News, and The Atlantic. He also spent two years investigating armed groups in Latin America for Facebook's Global Security division before returning to journalism in Texas. Badour holds a BA in Journalism and Latin American Studies from the University of Texas at Austin. He has lived in Argentina, Kazakhstan, and Colombia, and speaks Spanish fluently.
