GridBeyond CEO: Hybrid behind-the-meter storage wins despite market flux

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Michael Phelan, chief executive at GridBeyond

According to the recent 2018 Battery Storage report by MCP‘s sister title, The Energyst, 64% of industrial, commercial and public sector businesses surveyed are considering the implementation of behind the meter battery storage as part of their energy management strategy. At the same time, 80% of of those organisations point to revenue uncertainty as the main factor in delaying their decision to invest. Regulatory uncertainty does not make the situation any easier, a barrier cited by 50% of surveyed businesses.

“While waiting for the new regulatory framework and more details on the new grid balancing products, which we expect from National Grid’s service review in December this year, it might be a challenging time for pure-play battery storage providers. The mid and long-term market predictions look good, but the temporarily decreasing prices of FFR and capacity market might be worrying for those who invested in battery only operations.

“It is a different story if we are talking about hybrid solutions, where behind-the-meter batteries constitute a relatively small part of the overall network. From our experience, the most effective and robust models are made up of approximately 20% battery capacity and 80% of existing assets, whether that’s on-site generation or load. This ensures the best mix of energy resilience, maximising flexibility of on-site assets for DSR participation and return on investment.

“So, with a relatively small investment (when compared to the prices of large batteries alone), we can increase the value of the clients’ assets by bringing both the benefits of optimised storage and increased flexibility.

“Ultimately, market forces will take over, and the higher value assets will lead to a higher price in the grid balancing market. The key to succeeding, despite the uncertainty of the quickly evolving market, lays in investing in technologies proven to bring value despite external circumstances,” Phelan suggests.

“The battery winners will be those who do not sit on the fence, but drive change and shape the market through their innovative ideas.”

GridBeyond was a co-sponsor of the recent 2018 Battery Storage report. It contains a survey of public and private sector organisations considering battery storage deployment, as well as views from National Grid, energy and technology companies and consultants.

Download the report here, free of charge.

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