Faster battery buildout could save German consumers up to €2.8 billion by 2035

A faster rollout of utility-scale battery storage could deliver billions of euros in savings to German households and businesses while improving power system resilience, according to a study by the Institute of Energy Economics at the University of Cologne (EWI).

The report, commissioned by battery storage developer and operator Green Flexibility, comes as investors face uncertainty over evolving market rules, including grid tariff reforms, network regulations, and flexible grid-connection agreements.

According to the analysis, accelerating battery deployment would reduce electricity procurement and network costs sufficiently to lower consumer costs by up to €2.8 billion in 2035.

The researchers modeled two storage deployment pathways. The first assumes a rapid expansion to 32 GW of installed battery capacity by 2030 and 57 GW by 2035, broadly aligned with Germany’s long-term grid development plans. The second assumes a slower rollout reaching 12 GW by 2030 and 19 GW by 2035, reflecting current regulatory uncertainty and potential delays in permitting and grid connections.

The study found that a faster buildout would lower average wholesale electricity prices by about €2 ($2.27)/MWh in 2030 and €3/MWh in 2035, reducing average power prices by as much as 5% by the middle of the next decade.

Battery storage would also reduce price volatility by up to 26% in 2035 by absorbing electricity during lower-price periods and supplying power during peak-price hours. The gap between the highest and lowest hourly prices within a single day would fall by 18% in 2030 and 25% in 2035 under the accelerated deployment scenario.

Solar generators would benefit from the shift, with the market value of solar power rising by almost €4/MWh, or 18%, by 2035. The researchers attributed the increase to batteries shifting solar generation from lower-priced midday periods to higher-value evening hours.

The effect on wind generation would be more mixed. The study projects a 5% decline in the market value of onshore wind and a 12% decrease for offshore wind by 2035, as batteries discharge during periods of strong wind generation and comparatively higher prices.

The report also found that faster battery deployment could reduce market-based curtailment of renewable energy by 36% in 2030 and 48% in 2035. Storage systems could also help lower grid-related curtailment and reduce redispatch costs, although the researchers noted that Germany’s single bidding zone currently provides limited incentives for batteries to respond to local network constraints.

The study estimates that lower wholesale prices and reduced network costs would cut electricity costs for consumers by up to €0.3/kWh in 2030 and €0.4/kWh in 2035, resulting in total savings of as much as €2.8 billion.

The researchers also concluded that larger battery fleets would strengthen energy security by displacing fossil-fuel generation during periods of high residual demand. Under the accelerated deployment scenario, Germany’s natural gas imports would decline by 4% in 2030 and 5% in 2035, while hard coal imports would fall by 9% and 1%, respectively.

From pv magazine Deutschland