Enervis sees growth in battery storage systems

The management consultancy Enervis has compiled an overview of the battery storage market.

In Germany, battery storage systems with a total capacity of 1,700 MW have been installed in the last three years, whereby only storage systems with a capacity of over 1 MW were taken into account. Currently, it is mainly "full merchant battery storage" for up to two hours with marketing on the intraday market and balancing power that can be observed. This is the conclusion drawn by the Berlin-based energy consultancy Enervis in its market overview. At the same time, the experts have identified a trend towards longer storage periods and "multi-market optimization".

An expansion of at least 4,000 MW of capacity is planned for the next three years, with a large proportion of this expected to be connected to the grid in 2025. Bavaria and NRW are currently leading the way in terms of installed capacity of battery storage systems (BESS).

Enervis predicts that both the dimensioning and the storage duration of new storage systems will increase. While many installed BESS are still used for one hour in the primary control power market, the trend is towards storage systems with more than two hours of power output. The largest player in the market is currently RWE with around 293 MW of installed capacity and further projects in the pipeline.

Falling costs and power peaks help storage systems

An important driver in the past was primarily the innovation tender, now it is the sharp fall in cell costs, increasing volatility and arbitrage opportunities on the intraday market. According to their own statements, the transmission system operators have currently received grid connection requests for a further 226,000 MW of BESS lines.

The average project size is 350 MW, but there are also projects in excess of 1,000 MW. Accordingly, 90,000 MW want to be connected to the grid in the 50 Hertz area, 76,000 MW at Amprion, 48,000 MW at Tennet and Transnet BW has received inquiries for 12,000 MW.

The long-term development of the expansion of further battery storage systems depends on various factors, above all their economic viability. This will depend on the design of the electricity market system, as well as the development of investment costs and other costs for grid connection and construction cost subsidies. A capacity market or the marketing of other system services could promote the expansion of storage, depending on the design.

BESS are important for stabilizing the electricity system due to the high volatility of generation from PV and wind power. In its current electricity market scenarios for the first quarter of 2025, Enervis assumes an installed capacity of 10,800 MW to 23,000 MW by 2030. It should be noted that the capacity of the already installed BESS is subject to degradation. This depends on the use of the storage system with the depth of discharge, number of discharge cycles and similar factors, for which there is currently little long-term experience available.

Market opportunities for battery storage assessed

According to the Energy Industry Act, battery storage systems are in the "overriding public interest" and in market practice usually undergo an accelerated approval procedure for a building permit. The storage strategy and the grid development plan set the legal framework, which provides for privileged treatment with regard to the construction cost subsidy (BKZ), funding via the innovation tender and exemption from grid costs and levies for storage systems until 2029.

The future structure and amount of the construction cost subsidy (BKZ) for battery storage operators is unclear until the Federal Court of Justice has ruled on the validity of the Düsseldorf Higher Regional Court's ruling on the admissibility of charging BKZ for battery storage. A decision is expected in the first quarter of 2025.

With "Enerstorage Pro", Enervis offers the storage industry an online BESS assessment tool. This creates "individual stand-alone and co-location BESS revenue assessments". Project developers, energy suppliers, investors and banks can use these to assess the revenue opportunities and profitability of assets for specific projects. According to the energy service providers, co-location BESS is becoming increasingly important due to the growing shortage of grid connection capacities. In addition to the spot markets, there is also upside potential here through the marketing of balancing power.

AUtor: Susanne Harmsen