Gravity Well Commercial Economics Assessment: Potential Revenue and Cost: Cooperative Research and Development (Final Report)

In the Gravity Well Revenue Study, we evaluate the potential revenue from energy storage using historical energy-only electricity prices, forward-looking projections of hourly electricity prices, and actual reported revenue. This analysis examines the impact of storage duration and round-trip efficiency, as well as the location of the storage, on storage revenue within the current and projected U.S. power system. We also investigated the impact of round-trip efficiency on storage revenue. We found that the relationship between storage revenue and round-trip efficiency is nonlinear. The value of improved round-trip efficiency declines as round-trip efficiency increases. In the Gravity Well Future Cost Study, we applied learning curves to predict the future cost trajectory of Gravity Wells (GrWs). Two types of analysis were implemented. The first was a bottom-up analysis that used historical learning rates for cost components, such as motors and gearboxes, and cost categories (e.g., engineering and design, etc.) to determine the learning-by-doing based single-factor learning curve. The single factor learning curve expresses the relationship between the cost of GrW and the number of units deployed (or the cumulative capacity). In the second analysis, we predicted future GrW costs via a top-down approach. This approach accounts for historical cost trends in other renewable energy and storage technologies, which have similarities with GrWs. Using a multifactor learning curve that accounts for both intrinsic (cumulative capacity) and extrinsic (the elasticity in the price of steel) factors, we estimated the future cost of GrWs.