‘Without energy storage, renewables are not serious power plants’

Bright blue skies, spring-like temperatures – perfect weather for solar power. There’s only one thing you can’t miss: the opportunity to put the electricity to good use – even if the grid can’t absorb it. That is why Sungrow invited more than 300 participants from more than 20 European countries to Munich on Thursday for its “ESS Experience Day.” The theme of the partner event: The next stage of the European energy transition.

Without energy storage, the energy transition will not continue. That is, roughly, how the panel discussion at the event can be summarized. Europe has come a long way, emphasized the experts on the podium. Last year, the continent achieved cumulative photovoltaic generation capacity of 338 GW, according to trade body Solarpower Europe. “But without storage, the electricity cannot be used sensibly,” warned Starry Ge, analyst at market research company Rho Motion. In Great Britain, for example, half of the renewable electricity generated is already wasted, due to grid bottlenecks. That inefficiency ultimately drives up electricity prices. Europe has done a lot to expand renewables; now grids and energy storage must follow suit.

Long wait times

A central theme of the discussion was long grid connection times in many European countries. Florian Diehm, director of product and supply chain at energy storage developer Kyon Energy, spoke of the average five to six years a project in Germany takes, from initial conception to operational readiness. “The power grid is not growing at the same pace as renewable energy,” said Diehm. That is resulting in declining investment – not because there is no market but because there is a lack of infrastructure.

Diehm emphasized network expansion is a political issue and added an appeal to the politicians negotiating to form Germany’s next coalition government. “We can no longer excuse ourselves by claiming that Germany is a bureaucratic country,” Diehm said. “We need a clear, recognizable political will and programs for faster and more-digital network expansion.”

Poland is making energy storage progress. Adam Zalewski, vice president for strategy and development at Polish company Griffin Group Energy, reported the country has included storage in its grid capacity market program. Eight funding programs and markets for storage auctions have already been set up.

“We have 3 GW of projects in planning and construction,” said Zalewski, adding coal-fired power plants in Poland have reached the end of their operational life. That created a technical need to replace generation capacity – first with renewables and now, out of necessity, with energy storage. Grid operators are taking up the challenge. Where synchronous machines once inherently kept the grid stable, network operators must now take action and set up programs and markets to enable storage to take over such tasks. Zalewski sees movement in the field. As in Germany, though, it will still take years before the energy storage facilities are connected to the grid. He assumes those 3 GW he mentioned will not be fully operational until 2029.

Rho Motion’s Ge said she’s monitoring around 3,000 global energy storage projects. European development and approval times are by far the longest. She said the market urgently needs to wake up. In Australia, it often takes only six months to approve and build an energy storage project. Legislation there enables grid operators to process energy storage projects in an expedited process because they are a high priority for security of supply. In Europe, by contrast, long approval cycles and a lack of political resolve are still evident.

Long-term opportunities

For Lars Löhle, chief commercial officer of flexibility service provider Entrix, one thing is clear: energy storage is a necessity, not an option. “We need a high degree of flexibility in the energy system,” he said. “Storage can provide this – efficiently, controllably, and with a viable business case.” Anyone entering the market must understand, however, that the revenue models are complex. “You move between day-ahead, intraday, and balancing energy markets and have to find a strategy for how much risk you are willing to bear,” said Löhle.

Looking ahead, Stefan Zhao, head of research at Sungrow Europe, said, “Anyone wanting to invest in storage today must choose technologies that will still be viable on the market in 20 years – or at least be retrofittable. A flexible technology platform is crucial to participating in all future markets.” Rho Motion’s Ge added, technology such as sodium-ion batteries could gain importance in the future. They are expensive but, in the medium term, promise advantages in terms of material availability and sustainability.

There was panel agreement on one point: Without energy storage, neither security of electricity supply nor stable prices nor grid integration can be guaranteed. “Renewable energy can only be treated as serious power plants if they are combined with storage,” said Griffin Group’s Zalewski. Europe must face that reality sooner rather than later.

From pv magazine Deutschland.