Supporting Ecuador’s Energy Transition through an Energy Storage Program

Project Summary:

Ecuador’s government has recently committed to the Ecological Transition through which it aims to reach carbon neutrality by 2050, and for this, fossil fuel base generation will need to be displaced. Although hydropower generation helped diversify Ecuador’s electricity matrix, the country remains highly vulnerable to climate change, as 68% of its hydro capacity is run-of-river. This low hydro generation in dry seasons or during extreme episodes, like El Niño/La Niña is being compensated with fossil fuels. Introducing storage in the grid will allow the use of renewable energy while maintaining high reliability in the system. Storage can also improve the efficiency of Ecuador’s grid, increasing the capacity factor of existing resources and offsetting the need for building new pollution-emitting peak power plants. Green hydrogen can offer the ability to store for long periods excess energy from run-of-river hydro power plants that would otherwise be wasted. The grant aims to support Ecuador increase the resiliency of the electricity matrix while supporting green economic post-COVID-19 recovery efforts by facilitating the development of new electricity storage capacity. In particular, the activities to be carried out will focus on: (i) assessing the potential to develop large-scale battery storage systems; (ii) developing a green hydrogen strategy to support decarbonization efforts; and (iii) identifying regulatory reforms necessary to enable private-sector investments in the renewable energy sector, including storage. It is expected that the results of these activities will serve as inputs to the National Expansion Master Plan.

List of Activities:

• Activity 1: Assess the potential to develop large-scale battery storage systems in Ecuador to balance the grid and store renewable energy. 
• Activity 2: Develop a green hydrogen strategy to support decarbonization efforts and meet its NDC targets by 2030. 
• Activity 3: Identify regulatory reforms necessary to enable private-sector investment in large renewable energy power plants, including storage alternatives. 

Outcomes:

Output 1

• Assessment and Recommendation Report
• Participatory workshops with technical stakeholders

Output 2

• Strategy paper
• Participatory workshops
• Dissemination event

Output 3

• Policy recommendation report
• Participatory workshops
• Dissemination event

Outcomes: 

• Promotion of new investments to ensure resilience (private sector influenced)
• Change in government investments
• Development of Partnerships around use of storage, hydrogen and VRE solutions as a tool for decarbonization and alternatives for storage as an enabler of green and clean electricity provision 
• Development in Client government’s strategy
• Strengthening the planning and implementation capacity

Collaboration with K-Partners and Others:

Tentative

• Korea Electric Power Corporation (KEPCO) 
• Ecuador public organizations (ie: Ministry of Energy; CENACE; CELEC; EP; State-Owned Electricity Company