The other day, China National Energy Administration has officially released the “Chinese 1 GW Demonstration Project Short List”. With total installed capacity of 1GW, this list comprises of 9 tower plants, 7 parabolic trough plants and 4 Fresnel plants. In addition to excitement among CSP industry insiders, if you think it over, you probably will find out that although every pilot project on the list is different from each other in technology, transfer medium, and so on. What’s in common is that all of them have heat storage system. Without any doubt, energy storage system has been playing a pivotal role in solar thermal power plants across the world.
In an effort to improve cost efficiency of CSP plants, plenty of enterprises have chosen to further increasing performance of energy storage system and at the same time reduce the cost as much as one can.
A startup company from Norway, named EnergyNest, has developed and validated a novel technology for storing thermal energy in solid-state medium. CSPPLAZA journalist has interviewed EnergyNest’s CEO Dr. Christian Thiel who said that by means of a brand new material – HEATCRETE®, EnergyNest is ambitious to change technology for storing thermal energy on a large scale.
Figure: EnergyNest’s CEO Dr. Christian Thiel
Energynest: a startup company with novel technology
CSPPLAZA: Could you give us a brief introduction of EnergyNest?
Christian Thiel: EnergyNest is a European technology company which was founded in early 2011, during the past five-and-a-half years, we have developed a completely new energy storage technology. We have initiated a comprehensive joint research project in 2013 for the building and testing a 2 x 500 kWhth EnergyNest-type Thermal Energy Storage (TES) pilot with Masdar Institute of Science & Technology in Abu Dhabi. We have validated this first fully functioning installation with an independent third party, a global certification company called DNV GL. Since October 2015 our new storage project has been running completely smoothly, we have more than 1500 hours of operation, and several hundred cycles of complete charging and discharging cycles.
CSPPLAZA: Has EnergyNest been engaged in CSP industry when established? And why did you choose this field?
Christian Thiel: at first we had the idea of developing a completely new and cost-efficient energy storage technology and at the same time, we have an eye on this industry. We started to enter into CSP as we grew, we started to talk to customers Our Masdar Pilot has been integrated into an experimential CSP facility so we are very familiar with this segment. Apart from CSP, our technology can also address two other segments, basically, industrial plants or production facilities with high temperature regimes and you need “time shift” heat for electricity generation and potential later use of process steam. Another target segment for EnergyNest is wind power. However, CSP is our beachhead market.
Regarding to the reason why we chose this field is that we think CSP industry is promising, as we all know, either (steam) Tower or Parabolic trough power plants where thousands of mirrors will collect solar to heat transfer medium, and need a heat storage system to store extra heat. Our system can basically reduce cost of the entire CSP plant by about 10% – this results from cost savings of approx.. 60% vs. Molten Salt storage. So this is of great value to our customers, and therefore we decided immediately to enter this market. And we see that today about 55 installed CSP plants don’t have thermal storage system, such as lots of plants in Spain, which I believe is a huge market for retro-fitting, EnergyNest with simple module system, hiring local worker to produce necessary components, is able to provide the high cost effective technology for these plant, especially for small or mid-size energy storage where molten salt have been recognized couldn’t compete with our system.
CSPPLAZA: It shows on your company’s official website that, EnergyNest headquartered Norway, in addition, you still have offices in California, Abu Dhabi (the Middle East), Spain, so what time did you set them up? And why these four areas are selected?
Christian Thiel: we are an international company and also have a multi-culture management team. For example, I am the CEO and a German, our CFO is also a German. We have people from Norway, US, Canada Spain and Austria. In order to be present where our customers are we have established offices in different target marketsEnergyNest wants to be present where the market is. Without a doubt, US is a huge CSP market, some famous large-scale CSP plants have been built in California, such as Ivanpha. Therefore, we will always follow the markets. I also think China is a very interesting market, actually, we’ve follow up many steps in China, and it is our second visit to China this year, so I guess China will definitely have the priority to be our next focus, the CSP market of which has many impressive and ambitious CSP plans which is reflected in the 5-year plan.
CSPPLAZA: when reading your personal profile, I notice that you have worked in BMW Group, UBS Investment Bank, McKinsey & Co. and SENVION before joining EnergyNest, I wonder why you choose to enter EnergyNest which seems like have no relevance with your previous career. What’s your personal opinion to the prospects of CSP industry?
Christian Thiel: I started my career at BMW where I worked for almost 10 years of my life at the beginning. In fact, I have been with them since my university as a permanent staff. And I have been working on strategy and electric mobility in BMW. Then, I went to UBS Investment Bank, from which I went to McKinsey as a Consultant, at that time; at McKinsey began to focus on energy topic with my experience from electric mobility (e.g. energy storage) in BMW. But when a leak occurred in Fukushima nuclear power station in Japan, Germany decided to exit nuclear power and turned with strong focus to develop wind power. So we had to manage the decrease of conventional fossil fuel, so that’s my focus in this company. I was then hired by a German wind turbine manufacture Senvion, formally known as “Repower” one of two biggest offshore wind power producers. I was in charge of new market development, strategy, marketing and government relations. And Energy Nest found me, meanwhile I found them. I can bring together all my primary experience, like energy-related technology sector – ranging from e-mobility over renewable energies to energy storage, deal with different customers, to make EnergyNest grow. As for me, making our climate a cleaner place and EnergyNest is able to provide energy storage technologies for wind power, CSP to generate electricity to replace fossil fuel. So in that case, I think it is wise of china government to release positive policies to support CSP industry, which is definitely a right answer to the climate issue.
Key technology: HEATCRETE®
CSPPLAZA: In 2012, EnergyNest and Heidelberg Cement AG (referred to as HC) developed a new solid heat storage medium for heat storage system, so what kind of organization Heidelberg Cement AG is? Why do you choose to work with them?
Christian Thiel: Heidelberg Cement, a German multinational building materials company, is one of the top four cement producers across the globe. It is headquartered in Heidelberg, On 1 July, 2016, Heidelberg Cement AG completed the acquisition of a 45% shareholding in Italcementi S.p.A. With the acquisition, Heidelberg Cement becomes the number 1 producer of aggregates, the number 2 in cement and number 3 in ready-mixed concrete worldwide. Heidelberg Cement operates 156 cement plants with an annual cement capacity of 197 million tons, more than 1,700 ready-mixed concrete production sites and over 600 aggregates quarries. When it comes to regulate concrete and high performance of cement materials, they have the ability to know exactly how to manage. Therefore, we develop the special concrete, named HEATCRETE with them.
CSPPLAZA: what are the characteristics of HEATCRETE? And what’s the difference between HEATCRETE and conventional concrete?
Christian Thiel: The material is so special with many thermal and mechanical properties, called HEATCRETE®. It has been tested and verified by independent 3rd party laboratories: such as SP Technical Research Institute of Sweden, the Norwegian University of Science & Technology (NTNU), and Masdar Institute in Abu Dhabi. These laboratories have equipment and competence to measure and compile results for thermal conductivity, heat capacity, coefficient of thermal expansion, compressive and tensile strength. The high heat capacity of HEATCRETE® reduces the required storage volume, and a high thermal conductivity increases the dynamics of the system.
HEATCRETE® outperforms former state-of-the-art TES concrete in both aspects with 70% higher thermal conductivity and around 15% higher heat capacity. This has a significant impact on thermal performance and necessary amount of storage medium required for a given capacity (MWhth).
CSPPLAZA: It is universally acknowledged that molten salt heat storage technology is the most mature and most widely used in solar thermal power plants. So compared to molten salt, what do you think the strengths and weaknesses of EnergyNest thermal energy storage?
Christian Thiel: first of all, of course, I think it is great that molten salt has paved the way for energy storage in CSP. You know, solar thermal power plants can operate with heat storage, which is an overwhelming superiority of CSP compared with PV system, because it is very expensive for PV plants to storage energy where battery systems have to be integrated. But what we can not ignore is that using molten salt means additional complexity, very high technical requirements for the whole thermal storage system and technology, besides, more special engineers are needed, and it also takes long time for project owners to install Molten Salt facilities. I think, EnergyNest thermal storage is the better alternative technology to the market now, which is based on much more simplicity. You know, we have fewer components than molten salt systems and our system is freely scalable to any size of plants, no matter how large or small, ranging from 2MWh to GWh projects. With simple components, our thermal storage system is easier to be manufactured locally, which helps a lot in reducing the price, so economic benefit of our system is also attractive for customers if you consider the CAPEX advantage of up to 60%. What’s more, a CSP plant’s lifetime is 20~30 years, during which large amount of money is needed paying for operating, and in a molten salt plant, operating costs are the nearly as high as the investment cost in molten salt system, on the contrary, our heat storage with HEATCRETE has no moving part and thereby less capital is needed to be played for maintenance, about 80% cost can be saved compared to molten salt. So overall, we bring energy storage for CSP to a completely new and better economic level.
Regarding to weakness of our system, many customers tell us that they are familiar with molten salt heat storage system but did not know yet about EnergyNest. So how can the learn more about it? In that case, we answer that, of course, you can, and then invite them to visit our running Masdar pilot project in Abu Dhabi. And three Chinese delegations have already visited and experienced on site how our heat storage operates successfully. After seeing the system running smoothly without any smoke or noise, people are all convinced that our technology is fully mature.
CSPPLAZA: which kind of transfer medium is more suitable for your thermal storage system, oil or water?
Christian Thiel: I think our system offers the flexibility to go with the customer. Currently, 90%~95% global solar thermal power plants are using parabolic trough technology in which oil are widely used and we can work with oil, for instance, our Masdar pilot is running on oil cooperating with Dow company. At the same time, our system can also cover to steam tower technology because EnergyNest system can run on direct steam. Therefore, we can offer alternatives to molten salt, either oil or direct steam system.
CSPPLAZA: As we know, the highest temperature of thermal oil is 400 degrees, and you chose oil as heat transfer medium in your Masdar pilot project, many industry insiders are interested to know whether the oil matches the tower beam down system.
Christian Thiel: It is Masdar that made the choice to use oil and we just do that. In other words, we basically have the energy storage system and Masdar just used oil to run through our system. And we chose to thermal oil from DOW because they have very high quality product. Although we are a young and small company, we have collaborated successfully with several famous companies except for DOW, Masdar, Siemens are also our partners. Siemens mainly provided us with control unit for our storage system.
CSPPLAZA: What’s the life time of your system? How often do you need to maintenance it?
Christian Thiel: as we mentioned above, our system is based on a patented design comprised of HEACRETE® and steel. By charging and discharging storage energy, you actually put little stress on this whole system. For instance, if you were to put energy in and out once a day, over 30 years lifetime, the system only needs to run 10,000~11,000 cycles, the stress of which is so little for the components, because you know branches made of concrete need to withstand millions of cycles. So in a word, our storage has lifetime of at least 50 years. The customer buys our product and has no need to replace it until the first generation of plant finalizes. That’s why we are popular in wind power field, with our system standing there for 6~7 decades, they don’t need to invest more money to buy expensive batteries, which makes our storage system very competitive. And now that there is no moving part in the whole system, so the maintenance is free. But we have cooperated with Siemens who offers control system for us to monitor every part.
CSPPLAZA: Do you have any potential in reducing cost of product? And what are they? What will you do to further improve your technology?
Christian Thiel: I think the costs of our products are already extremely low now. So I think, to reduce cost, the first step is to build a big energy storage system to gain economies of scale.
You know, we have two main components, one is steel and another one is HEATCRETE®, on which we think the key to reduce cost is material research, and we are currently perusing some eternal efforts to work on next material generation that comes even lower prices in one or two years, while on the aspect of steel, the cost of which depends on how much you purchase. Without a doubt, it will be cheaper if you buy more steels for a bigger plant.
At present, our modules provided by us are about, in terms of industry KPIs that have been used, 25 dollars per kWh (Kilowatt hour), if you build a big EnergyNest storage, the cost will down to 20 dollars. Although I can not say the exact number, I am confident to say it will be lower. Most importantly, we will not stop here, instead, we will move on.
CSPPLAZA: What do you think of the actual performance of the heat storage pilot project built by you and Masdar? Most people tend to doubt that the heat transfer efficiency of heat storage system made of concrete is too low, does this problem exist in your system?
Christian Thiel: This pilot project has been operational since last year, October. In November, CNN even came to the scene to make a special TV feature, and since then it’s operated around the clock by crew of 7 who are jointly hired by Masdar and us. With switch shift, we keep the system running day and night. It has run for several thousands of hours and continues to be operative now. So what we still face with is long term of operation.
When it comes to the heat transfer efficiency of concrete heat storage system, some words of our founder often occurs to me that the risk is something what have happened in the first cycle when you bring concrete up to uprating temperature. As shown in our pilot project, our system runs as we designed from the beginning and no risk appears and no degradation in the concrete material. After 1,500 hours of operation, we see the performance modeling – the simulation tools show that everything is good. To our surprise, the results turn out to be better than we thought.
CSPPLAZA: Does your concrete thermal storage technology have been mature enough to be applied in commercial power plants? What have you done to make your technology realize commercial as soon as possible? what are the barriers during this process？How do you convince project owners to choose your technology rather than more widely used ones?
Dr. Christian Thiel: yes, although no large scale power plants have used our technology until now, I can tell you that our three business segments respectively have one partner who is going to build relationship with us, because of confidential contracts between us, I still cannot announce their names. There are at least four or five owners from CSP plants are talking with us about partnership, and to start a business discussion is also my visit to China this time. So far, some business discussion with project owners from US, the Middle East and Europe is going quite smoothly. We also talk with European about our product’s industrial application. In China, wind power is going to be an extremely interesting market for us.
The future market layout
CSPPLAZA: which regions or countries are you developing CSP business? What are the main markets in the future?
Christian Thiel: for CSP, our main markets now are US, the Middle East, North Africa, Spain and China. We also have other inquiries in Chile and India is also an interesting market where we have a lot of customers.
As a matter of fact, we are flexible to go with where demand is all the time. Besides, in our eyes, we are curious about customers which are innovation driven. Given the fact that we have one pilot projects in Masdar, we will continue to go with partners and develop new markets.
CSPPLAZA: China FIT policy has finally been released with the electricity of RMB1.15 / kWh, how do you think the prospects of China’s solar thermal market?
Christian Thiel: well, I think the cost of CSP will go down dramatically just like wind power and PV. And I am convinced of our technology which is cost competitive. Just as I mentioned initially, with our technology, we can help to reduce entire CSP plant costs by by10%. EnergyNest is one of the companies who are able to reduce cost in CSP industry. Because we supply energy storage at lower cost and can accommodate with cost restrictions easier than molten salt heat storage system, I am confident to say we have no problem with this price.
CSPPLAZA: it’s been several years since EnergyNest stepped on the land of Chinese market, what have you achieved for this long period? What will you do next to gain more market shares in China?
Christian Thiel: for such a long time, we have been strongly focused on China CSP market and at the same time, we’d like to take advantage of China’s huge wind power market. I think customers in Europe and Middle East know more about our technology simply because we are there for many years. We are fresh and just start CSP business in China, truthfully, however, we are familiar with Chinese market and we have evaluated who could be partners to collaborate with in new projects. Actually, my travel in Beijing this time is aimed to develop some business talks with several Chinese companies. Many of them told us before that they are willing to wait until our first pilot project is installed, and they are considering applying our system to their plants. Now that our pilot project has been completed and is running successfully, I think it’s great time to meet these partners. Now, we have reached a good entry point in China, and, so maybe we start to be popular in China.
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