Energy storage – What role it plays in the energy transition
- Apr 18, 2020 5:16 am GMT
It is well understood that Energy Storage Technology (EST) needs to be a key player in our energy transition and in our energy future. Like all businesses, each EST will be assessed and require a business case to yield an adequate Return On Investment (ROI) to attract investors.
One of the key challenges in building a business case for EST is the added value on other sectors of the energy value chain. However, the challenge remains in monetising this value. It is seldom a grid operator, or a government authority will provide a payment to asset owners of EST for the value they bring to adjoining energy sectors.
One sector that benefits from increased EST capacity is the grid. With the demand side, an increase in EST capacity, will reduce the load on the grid and therefore the need to increase grid capacity is deferred or avoided.
Other sectors which benefit from increased EST is the intermittent renewable generators. Considering the significant portion of the renewable generation is or will be by solar and wind generation, the EST on-demand and generation side, helps with filling the gap for intermittency of renewables.
As shown in the graph, the right EST capacity can reduce the peak demand during the peak energy prices when the renewable energy generation is unavailable. However, like the renewable technology the business case needs to produce the right ROI.
Atlantic Power Exchange is building a platform that helps with monetizing EST, helping the business case for more investment in energy storage through peer to peer energy trading.
What is your view on energy storage and the role it plays in the energy transition?
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