Spurred by a renewed interest in power storage the European Commission’s in-house science service the Joint Research Centre (JRC) has provided several recommendations on how to improve assessment of the economic value of storing electricity, in a recently published report. Drafted in cooperation with the R&D Department of Electricité de France (EDF), the report presents an overview of the current research into the economic drivers and barriers for electricity storage.
The researchers advise, for example, to study more systematically how storage might simultaneously provide services to different actors in the power system and how future technological and economic improvements might influence the business case for storage. These proposals are meant to be used as guidance for further research and as a discussion base for policymakers.
The researchers reviewed more than 200 publications from academia, consultants and industry. They looked into the methodologies used to assess storage value and profitability, and also defined the regulatory possibilities that might address the current challenges for electricity storage.
The JRC report differentiates between two broad categories of studies. Engineering studies aim to assess the value of an investment without modelling the whole system, while system studies represent the effect of storage on the entire energy supply system. Recent engineering studies seem pessimistic about the possibility of earning sufficient revenues to recover significant investments in power and reserve markets, although some additional value pools have been identified. System studies identified storage value in many cases, but a negative impact is possible if the deployment of storage requires additional investment in grid or generation infrastructure.
Evaluating the economic value of future electricity storage requires making assumptions about storage regulations. These may range from fees and technical instructions, ownership questions or fundamental market regulation. Minor technical rules may have a large impact on the viability of storage. In fact, any change in regulations will have an impact on electricity storage as the current frameworks for large-scale storage are not centrally regulated. New developments in the power system, such as the integration of renewable energy sources, will influence discussions on storage and issues such as the ownership and operation of storage devices.
For the full JRC report, see.