Apricum – The Cleantech Advisory.
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Apricum at a glance
Business • Founded in 2008
• >200 successful projects
Industry focus • Cleantech. Strong focus on solar, wind,
water, energy storage and digital energy
Team • >40 experts
Clients • Companies, investors and public institutions
Services • Transaction advisory
• Strategy consulting
Locations • HQ in Berlin, Germany
• Branch offices: Abu Dhabi, Dubai
• Representative offices in South and North
America, Europe, MENA and Asia
Apricum has been active in MENA for several years.
Globally, increasing projects in the energy storage space.
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References from the MENA region (examples):
References from global players / energy storage companies
…and many more
Drastic market growth expected for energy storage –
increasingly appreciated by the financing world.
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Global energy storage installations [GWh]
1) In cooperation with Cairn ERA
“Energy storage:
An underappreciated
disruptor” (Feb 8, 2017)
“Energy storage: An
underappreciated
disruptor” (Feb 8, 2017 “Energy storage will grow
exponentially”
(Feb 9, 2017) 0
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BNEF
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Market for
energy storage
Reducing costs
• Capex
• Lifetime costs
• “Outside of the storage box”
Increasing demand for…
• …flexibility in the power
system
• …replacements/expansion of
grid and generation
infrastructure
• …optimization of (combined)
sources of power supply
• …adequate quality
and reliability of power supply
Improving frameworks
• Remove barriers for storage
to participate in markets
• Incentives to push
early market
We see three principal drivers for future growth of the global
energy storage market.
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2
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There are four basic categories of demand, resulting in multiple
use cases for energy storage.
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Demand for Key drivers of demand Energy storage use case
Increased flexibility
in electricity
systems
• Increasing share of intermittent renewable energy
• Loss of inertia (decommissioning of fossil plants)
• Need for higher grid resilience
• Increasing rural electrification
• Ancillary services (frequency/voltage control,
microgrid islanding, black start)
• Direct RE1 integration (e.g., ramp control, RE
smoothing, RE firming)
Replacement/
expansion of
generation/grid
infrastructure
• Aged/strained grid and peak generation infrastructure
• Rising (peak) power demand/supply
• Increasing rural electrification
• Peaker replacement (peak shaving2, peak
shifting2, demand response2, energy arbitrage)
• RE time shift (PV, wind)
• T&D deferral/avoidance
• Grid congestion relief
Optimization of
(combined) sources
of power supply
• High prices for retail electricity
• Decreasing FiT
• High prices for fossil fuels
• Increasing rural electrification
• RE self-consumption optimization (residential,
RE-hybrid systems)
• Optimization performance of fossil generation
(replacement of spinning reserve, load firming)
Adequate
quality/reliability of
power supply
• Weak/strained generation/transmission infrastructure
• (Perceived) unreliable power generation
• Backup
• UPS
Source: Apricum analysis; 1) Renewable energy; 2) Behind-the-meter use cases, but incentivized by utilities to create value in-front-of-the-meter, i.e., avoiding additional
infrastructure investments
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B
C
D
Demand drivers – and potential applications for storage –
depend on the individual challenges in a specific region.
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Source: Apricum analysis; 1) Energy storage
• Examples of challenges:
• Aging infrastructure
• Time-of-use pricing, demand
charges
• Natural disasters
• Typical use cases for ES1:
• T&D deferral
• Peak shifting/shaving
• Microgrid islanding
• Examples of challenges:
• Decreasing FiT
• C&I demand charges
• High penetration of intermittent
renewables
• Typical use cases for ES1:
• RE self consumption opt.
• Peak shaving
• Frequency control
• Examples of challenges:
• Electrification of rural areas
• Insufficient infrastructure
• Expensive/inefficient diesel based
generation
• Typical use cases for ES1:
• T&D avoidance
• Anc. services in microgrids
• Opt. perf. fossil generation
Challenges in different global regions and resulting use cases (examples)
In the MENA region, there is a high potential for energy storage
as all principal demand drivers are present…
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• Masdar rural electrification project, Morocco
• Rated power/status: ~5 MW (17,610 batteries)/under construction
• Use case: Renewables self consumption optimization
• Demand driver: Increasing rural electrification
• NEPCO battery procurement, Jordan
• Rated power/status: 20 MW/announced
• Use case: Direct renewables integration
• Demand driver: Increasing share of intermittent RE
• Dukhan Oil Field, Qatar
• Rated power/status: 2 MW/contracted
• Use case: Direct renewables integration, backup
• Demand driver: (Perceived) unreliable power generation
• Afourer Pumped Storage Scheme, Morocco
• Rated power/status: 465 MW/operational
• Use case: Renewables time shift
• Demand driver: Strained grid infrastructure
Examples of MENA energy storage projects, use cases and drivers
A
B
C
D
…which has already led to an increasing number of energy
storage installations in different stages of implementation.
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Energy storage installations announced, contracted and operational, as of April 2017
Source: DoE, Apricum analysis
815 MW
161 MW
5 MW
30 MW
20 MW
2.25 MW
0.02 MW
0.1 MW
8 MW
(Electro)-chemical Thermal
Energy storage technologies
Mechanical
(Pumped hydro) Plus an undisclosed number of 1 MW storage pilots
announced by DEWA
Increasing cost competitiveness of energy storage will further
increase demand in the region.
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Price forecast for lithium-ion battery system prices1 for large-scale stationary storage applications [USD/kWh]
• Significant cost decreases expected due to:
• Technological improvements, in particular
growing energy densities
• Economies of scale due to rising battery
sales to multiple industries
• Declining costs not only for battery cells, but
also for packaging and other system
components
Source: Apricum BESS cost model Q1/2017; 1) On DC level
-51% 368
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Missing piece: Regulatory framework to create a level playing
field for energy storage in MENA (and elsewhere).
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USA:
Reward benefits
• PJM followed order 755 from the Federal Energy Regulatory
Commission (FERC)
• Performance payments for “MW-mileage”
International examples for regulatory activities supporting energy storage
India:
Set storage
targets
• Central Electricity Authority (CEA): Storage seen as
necessary to realize “solar dream”
• 10 GW of pumped hydro storage by 2022
UK:
Remove barriers
• Energy systems and
regulations were designed
for a pre-storage world
• Barriers for storage need to
be removed, no state
incentives needed
necessarily
• Individual approach for each
geography required
Energy storage will play an increasing role in MENA – be prepared!
• Call for Evidence by the Dept. of Business, Energy and
Industrial Strategy (BEIS)
• Aim to define clear framework for storage
Various energy storage technologies exist – but which is the
right one for the targeted use case?
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Overview storage technologies
Source: Apricum, ISEA, Avicenne; 1) Includes NaS, NaNiCl and Sodium-ion batteries; 2) e.g., Zinc-Air, liquid metal batteries, NiMH, NiCd
Energy storage technologies
Mechanical Electrical (Electro)-
chemical Thermal
Batteries
Power-to-X
Lithium-
based
Redox-
Flow
Sodium
batteries1
Latent heat
storage
Lead-acid
Thermochemical
storage
Sensible
heat storage
Others2
Double layer
capacitors
Superconducting
coils
Pumped hydro
Pressured air
Flywheel
Mechanical
springs
Energy storage value chain offers various opportunities to
participate in the market – but which are most attractive?
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Example: Battery energy storage system (BESS) value chain – non-residential
Cell mfg. Materials
Developer
Source: Apricum; 1) Energy Management System; 2) Storage Management System; 3) Battery Management System; 4) Power Conversion System; 5) Distributed Energy Resource Management
System
System
owner Module/
pack mfg.
BMS3 mfg.
Manufacturing
electrodes,
electrolyte,
binders…
Containerized
solution
System
management,
aggregation
Benefitting from
storage/selling
BESS as a
service
System
operator/
service
provider Storage
provider
Integrator
Financing,
site
selection…
DERMS5
provider PE/PCS4
provider
High-level controls (EMS1) provider
Low-level controls (SMS2) provider
Physically integrating
hardware and
software into a
working system
Construction
(“EPC”),
maintenance
Upstream Downstream
What can we do for you?
Meet me at the conference or contact:
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Florian Mayr
Partner
T +49 30 30 87 76 228
M +49 170 96 86 366