Big growth on the cards for UK’s energy storage market

While UK’s renewables projects stagnate, an energy storage market boom is predicted.
Published: Mon 08 May 2017

The UK’s commercial battery storage capacity is predicted to grow 100-fold by 2020. This is according to a new report from UK utility SmartestEnergy which is calling for  renewables and energy storage to be able to compete on a level playing field with other energy sources.  

The company’s fifth annual report highlights the fact that energy entrepreneurs are increasingly investing in large-scale battery units rather than in independent renewables.

Energy entrepreneurs focus on energy storage

One such example is renewable energy developer Anesco and supplier Limejump which plan to install a 185MW energy storage infrastructure by the end of 2018. Limejump will be operating the new system.

The storage system is expected to be the largest portfolio of energy storage that the UK has seen to date and could play a major role in balancing the grid once it enters the Capacity Market.

Anesco is no stranger to the utility storage sector. The company has just connected its twentieth utility scale battery unit, setting its active storage portfolio at an impressive 18.9MW.

In a statement, Erik Nygard, Chief Executive Officer of Limejump states :“The key to bringing more storage online will be to optimise the revenue that can be earned by generators and developers, from securing a good price for power exported onto the grid, to participation in the full range of revenue-generating schemes such as the capacity market.”

The energy storage battery revolution

The SmartestEnergy report goes on to show how renewable project figures have been dropping steadily. Over the last four years, an average of 275 independent renewable projects were installed, costing around £1.5 billion. Now as a result of subsidy cuts, the renewables projects figure is falling even faster - 38 in Q4 2016 and to just 21 in Q1 2017.

Moving to the storage sector, independent developers have already won 80% of battery contracts in capacity market auctions, ensuring a sufficient and reliable supply of electricity to meet peak winter demand. 

According to the report, independent developers have won 80% of battery contracts in capacity market auctions, having secured 407MW compared to just 105MW with the ‘Big Six’ firms.

Independents have also won more than half (110 MW) the battery contracts to provide enhanced frequency response to stabilise the national grid.

Just 20MW of commercial batteries were operational last year but 31 projects have already secured long term contracts to provide 578MW of capacity by the end of the decade. Planned projects for the next four years total more than 150 projects with a combined capacity of 2.3GW, an increase of more than 100 times.

This storage capacity is expected to prove vital in supporting an increasingly clean and intermittent energy mix.

Iain Robertson, Vice President of Renewables at SmartestEnergy, said: “Energy entrepreneurs are at the forefront as we transition to a new energy system.

“Independent developers still have renewable project pipelines and are looking at innovative ways to build without subsidy. They are now also driving forward the battery revolution.”