While renewables like wind and solar are getting cheaper and more efficient, they need storage to make them viable says Ron MacDonald, executive chairman of American Vanadium, who sees a big opportunity in supplying the market with vanadium-flow batteries.
"Renewables have never met their promise," said MacDonald, who was interviewed at MINExpo 2012 in Las Vegas this fall.
"One of the reasons for it is that storage was a problem. How do you store vast amounts of electricity that are coming from wind that is generating the power at night when there is no market or from solar when the demand is down? Old technologies like lead acid pretty much the only way."
MacDonald says there are new technologies out there for storing energy now but they never really met the economic test or could not be commercialized.
"Over the last six to seven years, a lot of activity in China turning up their production of renewable energy," says MacDonald.
"Six years ago China set their first renewable targets and they were at eight percent. They over-achieved. They got 8.9%. They also became the number one producer of solar panels, the number one producer of wind turbines but they increased the efficiency of it and drove the cost down so now solar is a good investment and you can get a good return on it."
But now China is now turning its attention to the problem of storage.
"Between now and 2021 they have set a target to achieve storage of 5% of their total electrical generation, not just on renewables. They are going to be generating 2.4 billion kw of power so if you do the math you see that storage—this is a massive new industry.
"Industry analysts have indicated that it is anywhere between $400 billion and a $1 trillion of investment globally between now and 2021 because these technologies are now commercially feasible.
MacDonald says these industries are now competitive with oil and gas.
"So this is going to be a massive new industry, a trillion dollar industry globally.
MacDonald says this is all great news for his business.
"Because the vanadium we got, the purity, and because of the way the deposit happens we will be able to produce the highest quality vanadium to go in those electrolyte vanadium flow batteries that are solution for renewables. And we are going to do it at a cost that we believe no one will be able to compete with.