A report by the Association for Renewable Energy and Clean Technology (REA) has suggested that a new market mechanism is required to stimulate growth in new energy storage technologies.
With greater intermittency brought about by the growth in wind and solar generation, one of the big challenges facing the grid is increasing the amount of flexibility in supply markets.
Flexibility markets are currently largely the preserve of fossil fuel assets, and REA estimates that at least 30GW of longer-duration energy storage is required by 2050 in order for the UK to meet its net zero commitments. Longer-duration energy storage includes technologies such as Pumped Hydro, Gravity Batteries and Compressed / Liquid Air Energy Storage.
However, the report suggests that under existing market conditions this target will not be met. This is due to the high capex costs associated with such technologies combined with low certainty in returns, making the securing of investment challenging.
REA Director of Policy, Frank Gordon, said: “Longer-duration energy storage will be vital to supporting our grid through the energy transition in the drive to net zero. However, as our report shows, we are a long way from meeting our targets on current trends.”
The report concludes that an ‘income floor’ would be the simplest and most effective solution for incentivising investment, and requests that BEIS issue a ‘Call for Evidence’ on how the barriers inhibiting longer-duration energy storage projects can be removed.
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