The Electricity Grid Is About To Change… A Lot!

This article is part of the ‘Think Further Thursday’ series, sponsored by Fred Alger Management, Inc. For more ‘Think Further’ content and videos, visit

In 2064, solar power and wind power will be have become so cheap that fossil fuel or nuclear power plants will be ancient relics of another era. However, solar power and wind power don’t come without any challenges. The electricity grid of the past century has never been ideal, not in the least, but it especially doesn’t work with renewables. We need very responsive energy storage or quick-ramping electricity generators of another sort in order to fill in when renewable electricity generation doesn’t match supply. Well, that or massively overbuild and simply dump/waste excess electricity.

To take back one step and get to the basics of why this is important, here’s a quick fact: electricity going into the grid and electricity coming out of it must match almost identically. If they don’t, then we get brownouts and blackouts.

For frequency regulation and grid stability, at the moment, fossil fuel power plants often have to be “spinning” (turned on and burning fuel) in order to fill in for renewables when they are not generating enough electricity. Furthermore, something needs to drop off the grid if there is an oversupply of electricity. Fossil fuel power plants are really not ideal options for complementing renewables. For one, we simply can’t keep burning fossil fuels at a high rate and retain a livable planet. In addition to that, they are not made to ramp up and shut down very quickly, and they will never be made to do so.

Batteries, on the other hand, are a perfect fit for these needs.

Take a look at these charts from Younicos, a German energy storage startup I recently visited on a cleantech tour of Germany, for a better visual understanding of how battery storage compares to conventional power plants used as backup:



Energy storage will eventually be used much more instead of fossil fuel power plants for frequency regulation and grid stability, and I’m convinced the type of energy storage used for much of this will be battery energy storage. The challenge, currently, is knowing which battery companies will lead the way. There are many larger players out there, and then there are startups like AmbriEos Energy StorageAquion, and ViZn. They are all aiming to be the provider of the lowest-cost, most-effective battery storage solution for the grid (and, in some cases, also electric vehicles).

While it’s still hard to pick the winners within this battery storage market, I can’t see a future in which this battery storage market doesn’t explode… in a good way, not in a fire and destruction kind of way.

Grids will be changing in other ways as well. We will still have large grids, but they won’t be nearly as dominant. Microgrids with cost-competitive battery storage will be common, and in places where utilities don’t adapt fast enough, off-grid households and communities will primarily rely on battery systems for their energy storage. The common threads through all of them will be: 1) a lot more renewable energy, and 2) a lot more battery storage.

It’s an exciting time! We are in the midst of what many consider a second industrial revolution — the cleantech revolution. From a renewable-centric grid to electric cars, a central element of that revolution is the humble battery.

This is the first article in a series on “The Changing Grid.” Check in again for more coming soon.

6 thoughts on “The Electricity Grid Is About To Change… A Lot!”

  1. Adam Weisshaupt

    Battery Tech is what is holding renewable energy back, and I see nothing in this article that suggests a breakthrough in that regard. . Wind and Solar simply can’t drive our industrial needs until a cheaper, more reliable and more efficient battery technology exists. And no many how many regulations and government guns you put into peoples faces, fossil and fission will continue to be used – because only they can meet the need. All such legislation does is drive up the prices for energy and lower everyone’s standard of living. Sorry folks, but reality doesn’t care about your feelings. Renewables won’t be used until the prices are competitive AND the technology can do the job.

  2. “In 2064, solar power and wind power will be have become so cheap that fossil fuel or nuclear power plants will be ancient relics of another era.”

    “Too cheap to meter.” Now, where have I heard that before?

    1. It is inevitable that “too cheap to meter” happens at some point. That is is because electricity gets continuously cheaper and society gets more and more prosperous. This has already happened E. G. In Norway, where electricity is often too cheap to meter. Also With Tesla solar and battery powered superchargers, electricity is already too cheap to meter, because the marginal cost for metering EV fast charging is too high relative to electricity price. Therefore it makes sense for Tesla to give electricity away for free forever.

      1. It will be similar to what happened with Long Distance telephone charges. The technology advanced enough that the charges were negligible. That’s why everyone basically gets unlimited Long Distance calling on their cell phones.

        1. Similarly more modern example. Mobile internet was used to be horribly expensive, but today operators are giving unlimited 100 Mbps bandwith away for free in return for small monthly fee. That is: mobile Internet is already today too cheap to meter. It really happens in real life because the technology evolves exponentially and this is exactly what will happen with EV charging in near future and has already happened with Tesla Superchargers.

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