REA: Small-scale battery storage has big future
The study, carried out by KPMG and commissioned by the Renewable Energy Association (REA), claims that the technology is a vital part of the UK’s transition to a decentralised, low-carbon energy system, while also finding that the cost of lithium ion storage innovation will be low enough for “early adopter” homes and businesses to fit onto existing generation developments.
The analysis, which also argues that certain larger grid-scale storage systems are already economically viable, calls on the UK government to offer the technology a clearer route to market, stating that energy storage is a valuable but missing component in the move towards a decentralised and consumer focused energy system.
Nina Skorupska, chief executive of the REA, said that 2016 is set to be a "breakthrough year" for energy storage and demand response systems. "This report shows that storage is already upon us and while traditional fuels like nuclear and gas are needing increasing help from the government, the cost of renewable technologies are coming down and many companies are looking forward to the post-subsidy business model," she said.
"We are not asking government for subsidies, what we need is a stable policy environment that has been so lacking in the past year, coupled with a common sense approach to regulation and the ability to fully participate in the electricity market.”
Lower overall energy costs, reduced risk of negative prices at times of low demand, and an improved balancing of local demand and supply are all cited as benefits of battery storage systems, according to the research, while increased contribution to the UK’s energy system from variable renewable sources and reduced dependence on imported fossil fuels are also highlighted as positive factors.
The paper also emphasises the level of revenue available to users of the technology from sources including the Capacity Market and grid investment deferment, along with energy supply revenues gained through participation in national energy markets.
The report is the latest in a series of studies into battery storage technology, following environmental consultancy firm Eunomia’s prediction that capacity is set to rise from 24MW to 1.6GW and the World Energy Council’s estimate that storage costs will fall as much as 70 per cent over the next 15 years.
