edit: turns out I was totally wrong. As Momonga-sama points out, there's a hard per-blast limit of constitution score, which would limit this particular character to burning no more than 22d6 per turn. I'm leaving the answer in place, though, as it contains information and insight that is still useful for understanding the resource economy of spellfire wielders overall. It turns out that even if you removed that limitation, you'd still have some serious difficulties with exploiting the upper range of that potential blast damage.
You can release it all at once, but it's not as impressive as it looks.
So, the rules clearly indicate that you can release more than one point at a time, and they make no comments that would limit you to anything less than your max cap. The spellfire wielder can indeed launch ludicrously powerful blasts. That having been said, your player isn't as impressive as you seem to think they are.
So, first, the spellfire wielder only gets Increased Storage 5 at level 7. The character you have there has a max cap of 88 (for an 88d6 damage blast). Even that, though, is not as bad as it looks. Anything he stores past 22 is going to start cooking off.
With a conmod of +6, they'll make their backfire checks 17 times out of 20. At a stored cap of 66-88, they're making a check a minute, which means on average, they're losing 9 charges every hour, and taking 9d6 damage from it. Further, every time they touch anything at all (say, in an attempt to drain it), they lose another 1d6 levels, and possibly get dazzled. This is not a particularly stable state to be in.
Even much lower on the chain, unless they've managed to figure out how to sleep standing up, they likely won't be able to sleep through the night without dropping a significant number of points. Any charge past that will get consumed, one point at a time (or more, if they started out above 44), by randomly touching things in their sleep (like, say, rolling over in bed). The fact that they're constantly firing off light spells is likely to have interesting effects on their ability to remain asleep and their tendencies to attract attention as well.
So, basically, up past 22, you're mostly limited to charging up off of having people cast spells at you today, and probably in the short term. Anything other than the standard "absorb off of spellcasting" requires you to touch something, after all. Further, damaging spells generally do a lot more than 1d6 per spell level in damage. If you're having your friends juice you up (shortly) before battle, then that one big blast is going to be really very inefficient with respect to their castable spell resources. How many sorceror friends do you have who are willing to pour their magic into you so that you can steal the show?
And then you get your one big blast, and it's impressive, all right. And then you're done, and you have 5 character levels worth of hungry hole to feed, and you've pumped a lot of your stats into con, and you're really very understrength in everything other than "blast with spellfire once" and "taunt enemy mages into casting things at me"
Worth noting that the standard ability only absorbs spells, not spell-like abilities. You can't just make friends with a warlock and juice up off of them (unless you're somehow in Eberron as well as being in the Forgotten Realms, and you have a friend with a very specific, somewhat high-level build).
Still, yes this works, and it's a bit silly, and it's still not a particularly awesome build because once you've burned all of the party spellcasting resources on one fight, then what do you do for the next fight?
Now, you can do some reasonably impressive things even without that. At level 1 spellfire channeler, they get the ability to drain charged items. If you're willing to eat a few level 1 wands a day, you can open every fight with a nice little 22d6 blast, and not cost your fellow party members anything. At higher levels, that starts being the sort of thing you can fit into your budget reasonably easily.
Also, as far as I can see, spellfire is ranged touch, rather than reflex save. Ranged touch is pretty easy to land, but if you miss, you got nothing, and spellfire channeler itself is half-BAB.