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Energy storage opens the way for usage of excessive production from renewables when transmission capacities are limited and prohibit balancing of supply and demand in location. Depending on demand and supply in a given region storage can therefore be a less costly alternative compared to the construction of additional transmission/distribution infrastructure.
Energy Storage represents a solution for increased energy security. On the one hand, ES can, in some cases, compete with back-up fossil fuelled power generation for grid stability. This may diminish the impact of load-following on power plant efficiency. On the other hand, if the stored energy is resulting from e.g. RES it can save costs directly linked to the curtailment of CO2 emissions from conventional power plants. As many storage technologies are still subject of research and development, their future costs are expected to decrease.
In any case, a specific/consensual estimate of future investments for the different technologies at European level is difficult to predict, taking into account:
- Uncertainty about the share, nature and special distribution of renewable generation;
- Uncertainty of the amount of storage. Energy storage is one of the means to stabilise the grids, provide flexibility and globally enable the integration of renewables. The optimal mix of technology solution is being investigated now and in the coming years;
- Uncertainty about cost evolution of storage technologies.
According to the IEA, the energy storage capacity needed, at a global level, to mitigate net variations due to variable renewable ranges from 189 to 305GW from 2010 and 2050. Please find further information on IEA website.
At the present, EASE is investigating different coherent and comprehensive business models for different storage users. Besides arbitrage, one can consider the following examples :
- Producers of (renewable) energy: energy storage can prevent revenue losses from curtailment;
- Grid operator: by providing peak shaving services, energy storage can avoid or defer grid upgrades and substitute existing grid services (ancillary services) in a more cost effective manner;
- End users of electricity: storage can enhance the value and usage of locally produced energy (e.g. rooftop PV) and/or avoid purchase of electricity during peak hours;
- Aggregators of storage services can benefit from several of the above value streams.
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