Energy Storage Report 2019
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21 FEBRUARY 2019 n WWW.RENEWS.BIZ RANKED N°1 The transatlantic IN RELIABILITY law firm close FOR BESS to home FIND OUT MORE Find out more here ENERGY STORAGE REPORT 2019 Storage spark for renewables MADE IN GERMANY CONTENTS 21 February 2019 ENERGY STORAGE 02 UK 03–09 Battery overdrive he global installation of energy service markets, such as the balancing n Developers get creative storage is surging as costs mechanism, are now the name of Energy storage is continue to fall and regulators the game. n Pivot’s ambitious play T n Eelpower and Orsted set to deliver step up efforts to facilitate batteries to “There was a very significant growth n Council and EU salt cavern schemes flourishing as costs help balance growing volumes of in interest in storage, particularly after intermittent generation. the enhanced frequency response Figures compiled by reNEWS show auction, which seems to have peaked,” IRELAND/GERMANY 10–12 fall and regulations around 2.5GW of 1MW-plus storage is said Anthony Price, director at UK loosen in the drive to due online in major markets in 2019 storage consultancy Swanbarton. — more than double the around 1GW “It has turned into a more mature balance grids, writes deployed last year. This expansion is market with more sophisticated types led by the UK, Australia, the US and of investors who are doing it with their Tim Probert South Africa. eyes open,” he added. Storage developers believe the Nonetheless, UK installations are n DS3 capped tender finally launched technology is on an unstoppable path due to hit almost 600MW in 2019, n Brandenburg flagship blueprint as renewables-plus-storage solutions which would top last year’s tally of n German power-to-gas nears reality become increasingly competitive with 460MW. n REDT looks beyond lithium-ion fossil fuel alternatives. The role of battery storage for “The point at which renewables vehicle charging and the rising FRANCE/REST OF EUROPE 14-15 generate cheaper than existing number of councils developing thermal plant is coming to pass,” said projects are key to the UK market. Mark Simon, chief executive of UK The country’s near neighbour, developer Eelpower. Ireland, is about to take its first In the UK, energy storage is going serious dive into energy storage through the same kind of growing having merely dipped its toe in recent pains as renewables did when support years. The Delivering a Secure n France and its territories get active mechanisms evolved. Sustainable System (DS3) tender, due n Italy leads European charge Developers have had to crunch the by the summer, is expected to n Schemes to improve grid stability numbers hard to make projects stack procure more than 100MW of storage n Battery demand tipping point ahead up financially in light of the suspension for Ireland’s Integrated Single of the capacity market and derating of Electricity Market. AMERICAS 16–18 short-duration projects as well as In Germany, standalone projects for other regulatory uncertainties such as the primary control reserve market grid charges. remain king but the country is finally The imminent removal of starting to get to grips with how embedded benefits, which incentivise co-located storage can enhance wind the use of storage to avoid grid sites. charges at peak times, have hit Power-to-gas schemes, meanwhile, n Gigawatt gain from US regulations financial models for storage projects. are poised to reach the 100MW-plus n Ontario’s peak shaving opportunities Co-located sites remain on the scale backed by major players such as n Mexican’s first big battery agenda but planned regulatory changes grid operator TenneT. n Utility-scale development in Chile to remove barriers to deployment are The US remains the most advanced yet to take serious effect. storage nation in terms of policy, with REST OF WORLD 19–21 Merchant projects that can California and New York states setting renews.biz participate in a wider range of grid ambitious targets for deployment. reNEWS figures showed around 2GW of US storage on the book as utilities’ procurement programmes and regulatory changes in regional grid markets take effect. n India’s storage industry mission A similar albeit smaller-scale n Policy push in China and beyond storage boom is happening in Canada, n Middle East make storage moves where rising grid charges and demand n South Australia leads the way response programmes are motivating large industrial users to take FRONT PHOTO advantage of peak shaving services. In the southern hemisphere, Australia is increasingly becoming the land of big batteries, particularly in South Australia where incentives are high amid grid instability. In Asia, storage is being driven by n BIG BOOST: Eneco’s Puurs 2MW state-backed and regional battery supplied by Alfen and linked SKY’S THE LIMIT: ElectraNet’s 30MW Dalrymple battery storage project programmes to balance renewables to 2.3MW Enercon turbines, Belgium’s in Yorke Peninsula, South Australia, commissioned last month output, in particular for solar in India Photo: ElectraNet and wind in China. first large storage system Photo: Alfen n 21 February 2019 ENERGY STORAGE 03 Creative surge needed to bring on the batteries K energy storage developers hit “significantly” by Ofgem’s Targeted live in the BM last August — the are having to be more creative Charging Review minded-to decision 10MW Breech Farm developed by Developers rethink Uto bring battery projects to last November to remove the financial Anesco, which was followed shortly fruition as a morass of regulatory benefits of transmission and afterwards with the 6MW Clay Hill. business models uncertainty threatens to slam the distribution grid charge avoidance. More aggregated storage sites are brakes on progress. “Storage has been really useful to expected to follow in the coming years to make numbers Industry experts said the sector had avoid importing from the grid at peak as National Grid adopts the Europe- been hit by a “triple whammy” of a times and that has been quite lucrative wide balancing platform TERRE (Trans stack up, writes capacity market suspension by the but that will be disappearing,” she said. European Replacement Reserves European Commission, frequency “Moving to a fixed charge from 2021 Exchange). Tim Probert response market price depression is a blow to the business model for Everoze partner Felicity Jones said and the impending phase-out of storage — developers, investors and the UK is seeing a “bifurcation” in embedded benefits by Ofgem. operators need to be more creative to revenue models for storage. Figures compiled by reNEWS show a find their niche in the market.” “On the one hand, some parties healthy storage pipeline of almost Developers are doing just that by focused on energy-intensive models 600MW of 1MW-plus projects due exploring market models that put a such as the BM and arbitrage, online this year, which would better greater focus on more energy- which are location agnostic, more last year’s total of 460MW. intensive modes of operation for merchant and tend to benefit from Many of those projects, however, batteries, such as National Grid’s economies of scale on a per are based on grid ancillary service balancing mechanism (BM), electric megawatt-hour basis,” she added. contracts such as frequency response vehicle charging, arbitrage and “The other big strategy is focused on and the capacity market, which no co-location with solar PV and wind. location-specific longer offers plentiful returns as they Storage aggregator Limejump revenue streams, such did a year or two ago. Energy entered the first battery to go as the emerging 04 One prominent UK storage developer told reNEWS it did not reach financial close on any of its 10MW- plus projects in 2018 and is not expecting to bring anything online until it works out how to make the numbers stack up. “The model is highly likely to be a combination of merchant revenue in the wholesale electricity market via timeshifting, the capacity market and Containerised Substations Lloyds NERS ICP firm frequency response contracts,” a source said. Electricity Storage Network policy chief Madeleine Greenhalgh said the renews.biz storage sector’s prospects would be Grid Connections Balance of Plant Private Networks Contestable Works up to 132kV Electrical & Civil Balance of Plant Bespoke Containerised Substations Operations & Maintenance Grid Connections Energy Storage Solutions Earthing Design & Installation 4358 Certificate Number 11675, ISO9001, ISO14001 & OHSAS18001 g2 Energy, Olney Office Park, Osier Way, Olney, Buckinghamshire, MK46 5FP BOXING CLEVER: Stratera Energy’s 50MW Pelham in Hertfordshire +44 (0) 1234 482482 [email protected] www.g2energy.co.uk Photo: Stratera Energy 21 February 2019 ENERGY STORAGE 04 ACTIVE UK DEVELOPMENT Braco, Perthshire Capbal 10 Lithium-ion battery Creyke Beck, East Riding of Yorkshire Statera Energy 50 Lithium-ion batery Online in 2018 Cricket St Thomas, South Somerset South Somerset District 25 Lithium-ion battery Project, location Developer MW Technology Council/Opium Power Aylesford, Kent BESS 29 Lithium-ion battery Drumcross, West Lothian Muirhall Energy 30 Lithium-ion battery Barnstaple, Devon Philip Dennis 3.75 Lithium-ion battery Emirates Stadium, London Arsenal Football Club 1 Lithium-ion battery Foodservice Larport Farm, Herefordshire Anesco 19.5 Lithium-ion battery Batwind, Aberdeenshire Equinor 1 Lithium-ion battery Lower Road, Essex Gore Street 10 Lithium-ion battery Breach Farm, Derbyshire Anesco 40 Lithium-ion battery Harker, Cumbria Pivot Power 50 Lithium-ion battery Broxburn,