A new paper examining the key role of energy storage in a decarbonised and decentralised UK energy market is being launched today at an event in London. The paper was written by leading experts in decentralised energy, Regen, with the support of key industry players: Green Hedge, TLT LLP, Triodos Bank and Vattenfall.

The paper Energy Storage: The Next Wave looks at the key role of energy storage in providing flexibility as the transformation to low carbon and more decentralised energy continues. The paper sets out the key challenges for government and market to overcome if energy storage is to achieve its potential to play a key role in the smarter energy system.

Ray Arrell, senior project manager at Regen, said "There has been unprecedented interest in storage with a 'first wave' of over 500MW in the pipeline. Our analysis shows the next wave of projects will be located alongside generation and demand at the heart of a low carbon, decentralised energy system. But, to unlock this potential we need the right support from government and the market, driving cost reduction of energy storage."

Philip Bazin, environment team manager at Triodos Bank UK, said: "The deployment of sustainable energy storage solutions is one of the key pillars that is required to achieve an energy system that is 100% sustainable - a low carbon, resilient and balanced energy system. It is essential that financial institutions work closely with developers, regulators and policy makers to create a conduit for energy storage technology that will support the wider deployment of renewable energy generation. As this report identifies, some very helpful progress has been made on the regulatory side these past few months but more work is required to establish a stable, medium to long term regulatory framework that will help make this a truly "bankable" asset class."

Gunnar Groebler, head of business area wind at Vattenfall, said: "The beauty with the battery is that you have a wide range of options of how to place a battery in an electricity system, be it EFR like Pen y Cymoedd or back-up. So there's much more flexibility around the business case with batteries. Here we have a four year contract with National Grid and after that we are merchant, or we find another way of offering that service to National Grid or anybody else.

The flexibility around the business case is much higher so we're taking to some extent a higher risk on the investment but also I think the flexibility provides us with some kind of genuine certainty that there is a business case for it."
Maria Connolly, head of real estate at TLT LLP said "Energy storage has already played a key role in re-shaping the clean energy sector and driving the growth of clean energy projects across the UK. One area of particular interest for developers and investors has been co-location and behind the meter projects, where a battery is co-located with another renewable energy source such as solar or wind or operates to manage supply and demand of energy in buildings, with or without a generation asset.

The barriers to entry for co-location projects are reducing and we are likely to see a continued upsurge in these types of installations over the coming months, thanks to recent high level indications from Ofgem. From a legal perspective, issues to consider include lease terms, power purchase agreements and grid connection arrangements to name but a few.

We are delighted to be able contribute to this report and hope that it will provide some useful insight to those who are looking to operate within this space, and encourage the next wave of energy storage projects in the UK". 
Niels Kroninger, managing director at Green Hedge Energy UK said "Since the publication of Regen's first storage report we have seen standalone, distribution-connected batteries relying on ancillary services revenues (EFR, FFR) becoming a reality. It is, therefore, timely that the second report again looks into the future: how can ancillary services revenues be replaced as the main revenue for batteries with other income streams, how can batteries be used in more complex eco-systems, in other words alongside demand and/or generation. There is every reason to believe that the business case for new storage systems will continue to evolve."

Download the paper Energy Storage: The Next Wave

Notes for Editors

About Regen 

Regen passionately believes that sustainable energy has a vital role at the heart of a successful economy and thriving local communities. We are an independent not for profit that uses our expertise to work with industry, communities and the public sector to revolutionise the way we generate, supply and use energy. www.regensw.co.uk

About Green Hedge
Established in 2010, Green Hedge develops, builds and operates energy storage projects. It is majority owned by cleantech private equity firm Zouk Capital and has developed 20 solar farms across the UK, totalling 150 MW.

About TLT LLP 
TLT has been involved in the clean technology sector for over 20 years, advising on a wide range of projects for a variety of different organisations from high growth entrepreneurial companies to large utilities, banks and equity investors.

About Triodos Bank
Triodos are a global pioneer in sustainable banking, using its €13.5 billion in assets to create social, environmental and cultural value in a transparent and sustainable way. Triodos Bank 20 years' experience of investing in renewable energy, with UK operations based in Bristol and branches in the Netherlands, Belgium, Spain, Germany and an agency in France.

About Vattenfall
Vattenfall are a Swedish power company, wholly owned by the Swedish government and one of Europe's major producers of electricity and heat. Vattenfall is progressing the largest co-located battery and wind farm project in the UK at the 228 MW Pen y Cymoedd Wind Energy Project, a 22 MW battery storage system which will provide Enhanced Frequency Response (EFR) services to National Grid.

About Regen's storage market insight publications

  • Energy Storage: Towards a commercial model was published by Regen in November 2016
  • Energy Storage: The Next Wave was launched at an event in London on 1 November 2017, with speakers from the sponsorship partners and National Grid