Insights / A guide to battery storage solutions

All charged up: A guide to battery storage solutions for businesses

You only need to look at recent advances in electric vehicles to see how far battery storage technology has come.

Over the past few years, lithium-ion batteries have become smaller, cheaper, and more powerful. These advances have made the technology an increasingly viable method of storing energy at scale and more economical for businesses.

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The adoption of batteries for electricity storage has been widespread. RenewableUK’s latest Energy Storage Project Intelligence report showed that the UK had 16.1 GW of battery storage capacity currently operating and in the pipeline. For comparison, in 2012, applications were just 2 MW.

What are the benefits of using batteries for businesses?

1. Resilience

Currently, most onsite batteries are used as a back-up. The stored energy works like a generator, keeping the lights on and machines ticking over in the event of a power cut.

This resilience is vital for organisations without generation capacity that are fully reliant on the grid for their energy.

Batteries are also key for companies generating their own wind and solar electricity – helping provide power at times when the weather prevents intermittent generation.

By using batteries, renewable electricity can be stored when it’s sunny or windy and then discharged when needed. This offers a reliable supply of electricity without calling on the grid or fossil fuel sources.

An increased number of intermittent renewables on the electricity system also creates a need for more balancing services. This includes generators or electricity storage that can quickly jump into action to meet demand or stabilise frequency.

National Grid ESO calls this dynamic containment and batteries are well placed to provide these services by rapidly discharging electricity when needed.

2. Flexibility

When it comes to electrical assets, being flexible means you can take electricity from (or sell electricity to) the grid, at the best possible time. Demand on the grid dictates the price and so “off-peak” times are cheaper time to use power.

Companies optimised for flexibility are able to lower their energy consumption at peak (more expensive) times. This might involve shifting some processes to run at night when energy is cheaper or even moving a tea break and turning off the machines for an hour.

But many companies can’t just turn off machines without impacting processes or halting their production line completely. This is where batteries come in.

Battery storage is the ultimate flexibility enabler. You can charge your battery when energy is cheaper, and then discharge and use that energy at peak times when the grid is most expensive. It won’t affect your output, but you’ll make significant savings on energy costs at the same time.

3. Generating revenue

Not only can you save money from lowering your demand on the grid when it’ll cost the most, but you can also export stored energy back to the wholesale market during times of high demand.

Every company is different, but we can help you work out (and automate) the best schedule to charge, store, discharge, and sell.

For example, an agricultural business with a wind turbine on site might charge up their batteries when the wind is blowing during the night and then sell that power to the grid during the day when the prices are higher.

In addition to selling excess power, batteries can also generate revenue as system stability assets. The National Grid ESO aims to procure 500 MW of low frequency response from providers who can quickly deliver electricity to balance fluctuations.

That amount is set to evolve to 1 GW next year, with batteries expected to make up the majority of frequency response providers.

How to future-proof your business with batteries

The UK government estimates that battery storage systems could save the UK energy system up to £40 billion by 2050.

Over the coming years, most new, commercial sites are expected to be built with battery storage as standard. As old diesel generators, that often supply sites like hospitals with back-up power, need replacing, battery storage offers an attractive source of resilience.

Behind-the-meter batteries

A key type of electricity storage for businesses will be behind-the-meter (BTM) batteries. These embedded, on-site batteries provide electricity directly to an organisation without going through the grid. In the past, they’ve not been seen as economical, but with new technologies like lithium-ion models, that’s changing.

Already, the National Grid is offering financial incentives for battery use. As the UK works toward net zero carbon emissions, these will only increase.

Economic incentives

At the same time, the changing nature of the grid, from centralised and fossil fuelled to distributed and intermittent, will result in higher electricity transportation costs to compensate for an increased need for balancing services.

Power will become more expensive at peak times, meaning there’s even more value to be had from flexibility. Battery storage will be key to enabling this flexibility for many businesses.

It’s a rapidly moving market – the incentives, the economics, the technology. Even the batteries themselves are constantly changing and advancing. Previously, an 8kWh battery was the size of a shipping container; now it’s the size of a chest of drawers.

With all this constantly evolving technology, you may be wondering when it’s the right time to invest. We’re here to help.

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Get in touch with our Electric Assets team who can advise and support you with your energy optimisation opportunities.

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