Greening the Grid: LightSail Aims To Make Power Cleaner By Making Energy Storage Cheap




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Inside a converted firehouse in Oakland, Calif. sits a Willy Wonka-like contraption sprouting pistons, crankshafts and cylinders connected to a pipe running through a wall to a large tank that squats outside the early-20th-century building.

It could just be the future of energy.

The compressed-air system devised by a 24-year-old wunderkind named Danielle Fong and her 50-something partners at LightSail Energy looks old-school industrial but is on the technological cutting edge. The startup is angling to alter fundamentally the way we generate and use energy by creating a clean, economic way to store electricity and return it to the power grid when it is most needed. That’s crucial if carbon-free but intermittent sources of electricity like solar and wind power are ever to displace fossil fuels.

“LightSail has the potential to be the cheapest technology if things turn out as we expect,” says green tech guru Vinod Khosla, a leading Silicon Valley venture capitalist who has invested $15 million in LightSail.

As more renewable energy comes online, utilities face the prospect of building multibillion-dollar fossil fuel “peaker plants” to supply electricity to keep supply and demand balanced when the wind stops blowing and the sun isn’t shining. Utilities would pay a lot to avoid building new plants and transmission lines if energy storage could solve the same problem. “I realized we had our sights on a market of almost inconceivable size,” says Steve Crane, LightSail’s 58-year-old chief ­executive.

In 2009 Crane, a serial entrepreneur, founded LightSail with Fong, the startup’s chief scientist, and chief technical officer Edwin P. Berlin Jr., a 54-year-old engineer. Fong dropped out of junior high school to enter ­college at age 12, worked on nuclear fusion at Princeton at 17 and moved to Silicon Valley at 20. Khosla says he knew within 15 minutes that he wanted to invest in Fong, a member of FORBES’ 30 Under 30 list, noting her “off-the-charts brilliance.”

Fong believes her breakthroughs in compressed-air storage technology will allow LightSail to provide electricity more cheaply than a natural gas peaker plant, whose rates can run around 15.5 cents per kilowatt-hour. Compressed-air storage uses a motor to drive a piston to compress air in a tank. As the air compresses, it warms and converts mechanical energy into heat energy. To release that energy when needed, operators re-expand the air by heating it. The force of the expanding air drives a turbine or pistons to generate electricity.

Existing systems expel the heat into the atmosphere during compression and burn natural gas when heat is needed to re-expand the air. LightSail claims it has greatly reduced the amount of wasted heat, and thus lowered the cost of compressed-air storage, by spraying water into the air inside the tank during compression to absorb heat energy. It then separates the water from the air and stores it in a small holding tank. When electricity is needed the warm water is sprayed back into the cylinder to heat and expand the air.

LightSail will build a pilot project that’s expected to go online at a Texas wind farm next year. “It may be a good economic solution for the large potential market in midrange energy storage,” says Andrew Oliver, an executive with the wind farm operator Renewable Energy Systems Americas.

The startup faces an array of competitors that may hit the market sooner, according to Lux Research analyst Brian Warshay, who estimates the global market for grid storage will hit $1.4 billion in 2015. Says Fong: “What’s really crucial is for this industry to produce technology at a really low cost.”