Contributed Commentary by Conor Sheehy, VP Green Economy Investments, IDA
April 13, 2022 | Countries around the world are driving ambitious climate action targets to end generation-long effects on global warming. Some governments are going even further to guarantee their carbon neutrality with Ireland among the few countries holding its feet to the fire by incorporating climate action targets into law.
As the world races to meet climate-action goals, new technologies are emerging to meet the demand. Electrochemical storage technologies are one of the more important tech ecosystems solving very real needs and have become the savior for capturing and storing energy in clever ways for future use in vehicles, houses, industrial use, smart cities and more. At the fore of this exciting revolution are battery energy storage systems (BESS). These unique systems capture and accumulate energy from electricity grids, solar, wind and other renewable power sources and store the energy in rechargeable batteries for later use.
The global market for BESS, estimated at $3.2B in 2020, is projected to reach $12.9B in 2026, according to global industry analyst StrategyR. The US BESS market was estimated to reach $1B by year-end 2021, and European demand is expected to exceed $709.3M by 2026. Without a doubt, BESS—given their availability, efficiency, and technological advances—are expected to lead the way in energy storage in the coming years.
Countless companies at the heart of Silicon Valley’s battery ecosystem are beefing up production to meet this growing industrial and consumer demand. These companies say their biggest challenge comes from their inability to grow fast enough in the US to reach the market opportunities. Hampered by the lack of talent as well as the desire to reach lucrative markets in Europe, some companies are considering Ireland as a resource to support their operations.
Why Ireland for Batteries?
The Irish government supercharged the renewables sector with an ambitious target of 70% renewable electricity for 2030—key to this is transitioning its grid from fossil fuels toward renewable energy. The country, distinguished as the third highest globally of per-capita wind energy capacity, is now looking to wind energy to not only supply energy but as a means for energy storage. However, the intermittent nature of wind is the biggest problem associated with this power. As the capacity of wind increases, so too do the problems. Energy storage systems are now seen as solutions to these problems and can be used to store electricity at times of high wind and discharged in times of low wind speed.
The wind farm scene in Ireland has significant potential. This breeze-abundant island has 900 miles of coastline and a sea area seven times larger than its land mass. Wind Energy Ireland reports that Ireland is number one worldwide in onshore wind energy, producing nearly 40% of its electricity needs from wind. This capacity will more than double in the next decade.
Offshore wind provides the largest opportunity. While current production levels for offshore wind are significantly lower than onshore, Ireland plans to almost double its onshore wind generation (from 4.1 GW now to about 8 GW) and increase its offshore wind electricity from 25 MW today to 5 GW by 2030.
English-speaking Ireland is often favored by US companies as a base from which to grow their emerging technologies because of its cultural and language similarities, deep talent pool, and thriving R&D ecosystem. Its deep-tech startup scene attracted $800 million in venture capital between 2015 and 2020, making Ireland among the top 10 places in Europe for funding. IDA Ireland, too, has a suite of grant mechanisms for sustainable projects.
Amazon’s first wind farm project outside the U.S., located in Cork, is just coming online, and another will follow in Donegal. Facebook/Meta has signed a deal with a wind farm operator in Tipperary that is part of a bigger project tapping wind and solar to reduce its greenhouse gas footprint by 75% and reach 100% renewable energy use. And Microsoft was an early adopter of wind farms to power its local operations in Ireland, signing a deal with GE in 2017 that gave the company available energy for trading while also testing new batteries designed to deliver energy back to the grid.
In addition, Statkraft, the largest energy generator in Europe, has plans to develop 500 MW of offshore wind energy in Ireland and has developed an energy storage battery in partnership with US Fluence. The hybrid battery and wind project combines 11MW of battery with 23MW of onshore wind.
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