British Solar Renewables and Western Power Distribution (WPD) have recently announced their plans to build a £1 million battery storage project in the UK1. The project is welcome news for the sector, pushing the development of storage a step further towards becoming commercially viable in the UK's renewable energy future.
The industrial-scale battery storage facilities will be some of the first of their kind in the UK market. The project will link a 1.5 MW solar park at Copley Wood in Somerset to a storage facility and the WPD South West electricity network. The battery will be built and supplied by RES, who have previously worked on battery energy storage in both the USA and Canada. The project is due to be completed by 2018.
In the light of the last year's changes to renewable policy in the UK, much of the recent technological drive has been steered towards renewable energy storage. Industry figures are predicting a break-through year for the industry2 with sources suggesting that electricity storage capacity will reach 1.6 GW by 20203. Enthusiasts anticipate that if we are able to capture the energy generated by technologies such as solar and wind, we will be able to eliminate problems with shortfall (and arguments against the technology in general). Renewable energy is not unpredictable, but it is intermittent; greater storage potential would allow electricity to be time-shifted to when it is needed.
Despite moves towards this area in recent years, progress has to-date been slow; however, the new political landscape brings the impetus to develop the technology to the forefront. It was announced in the Autumn Statement that the government plans to double DECCs innovation programme to £500 million, with £250 million to be directed towards non-nuclear development4. Although not all of this money will be ring-fenced for storage, being one of the last sources of funding available to encourage developers in the field, it has clearly captured their attention.
There are three distinct market areas for storage5:
- Consumer support - smaller scale solutions for consumer/small commercial.
- Generation support - larger scale, alongside standalone PV, onshore wind and other large scale renewables
- Network support - National Grid and local DNOs using storage to better control capacity and the network.6
The barriers for the first two market areas have mostly been financial. The main barrier to the network support model has been regulatory.
Energy Storage Regulation and Policy
Traditionally, the legislative, regulatory and commercial barriers to grid scale electricity storage are said to have stemmed from their treatment as either generation or electricity-end-user (Electricity Act 1989 and EU Directives). The effect of this is two-fold: private storage facilities are charged too much by regulated network operators and energy suppliers, and network operators find it difficult to use storage instead of network expansion (furthermore, the Electricity Act 1989 and the Electricity Directive 2009/72/EC prevent network operators from controlling the sale of electricity to consumers, restricting their ability to use storage for fear of DNO monopolisation).
Bodies such as Electricity Storage Network argue that electricity storage should receive support for larger-scale deployment, in anticipation of the potential future need and the potential cost savings. The House of Lords Science and Technology Committee has recommended that the Government examine whether electricity storage should be placed under the Contracts for Difference regime (which pays many low-carbon generating technologies above the market price for electricity) rather than the Capacity Market which pays participants near to the market price and is unlikely to support new projects in the near-term.7
Reports suggest that Energy Secretary Amber Rudd is aware of these regulatory barriers and the need to change them, and recognises the important part that storage can play in managing our low carbon future8. With the correct incentives and regulation in place, the development of the technology certainly seems an exciting prospect for investors in the market, at an otherwise challenging time for the renewable energy sector.