24 July 2017

Battery storage and smart energy – the way ahead

Battery storage and flexible energy use, now the subject of much discussion, has been an area of focused development in recent years – now that the rules appear about to change to support domestic generation and storage, it will move higher up the renewables agenda.

The shift towards demand-side response and battery storage is now being accompanied by a focus on smart energy and flexibility in the energy market. What does this mean? Smart Energy is really as it sounds – using energy in a smarter, more efficient way.

Developers are moving into battery storage in a way that was previously only talked about. It is telling that battery technology is now also being targeted at the domestic market. Costs have come down and the technology will develop, but it can only really take off on a domestic scale with the introduction of domestic smart meters. Perhaps the rule changes will start a smart energy revolution that changes the way we think about, and use, energy.

The changes follow a Government consultation which ended earlier this year – announcing the ‘call for evidence’, OFGEM Chief Executive Dermot Nolan said:  “Having a smarter system will revolutionise how we all interact with the energy market. A smarter system also makes it far easier for new businesses to enter the market and offer new services. To get there, we must make sure the regulatory regime is fit for the energy system of tomorrow and remove any barriers.”

A move to smart, flexible energy is not an easy overnight solution and requires some big thinking in relation to our distribution network. This is a challenge not be underestimated, so the Government consultation was welcome and was accompanied by attempts by National Grid and the various network operators to identify and quantify the future requirements of the grid.

Another area which ought to – but has not until now – really be the focus of attention is heat. Government figures suggest that heat accounts for around 45 per cent of UK energy consumption and more than 30 per cent of carbon emissions.

Heat is a challenge; it cannot be moved large distances in the way power can and there is no silver bullet of a solution, but surely battery storage can be a part of the picture. Heat networks can provide heat on a wider scale and can utilise waste.  There is a Heat Network Infrastructure Programme and, together with a renewed look at the renewable heat incentive, this will hopefully be an area which receives some focus.

The challenge for BEIS and those in the industry cannot be understated. As a country, we have committed to an 80 per cent cut in carbon emissions by 2050 and yet we must ensure a secure supply of energy. This will bring challenges, but also new opportunities and some policy changes, as we are now seeing, the way.

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About the Author
Harriet Murray Jones, Partner, Head of Real Estate Team, Hereford & Wye Valley
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