Nissan and REA warn of regulatory inaction ahead of energy storage boon
The UK can deliver a "vibrant and healthy" energy storage industry that can create one of the world's most efficient grids, but only if the approaching General Election doesn't "rip up" progress to date.
That was the view of a roundtable of members from the Renewable Energy Association (REA), Nissan and US battery developers Eaton, who met at the UK launch of the xStorage home battery unit to discuss how the UK can foster the technology.
Eaton and Nissan’s xStorage residential battery unit will begin selling in the summer, and Eaton views the UK as the ideal location to facilitate demand for battery storage. The US firm has 4,300 UK employees across 30 sites and has worked with Nissan since 2012 to establish a commercially viable energy storage system.
Speaking at the launch, Nissan’s managing director of energy services Francisco Carranza claimed that the UK Government was supportive of energy storage as a concept, but that regulatory frameworks needed to be put in place to balance the economics.
“Energy storage has the potential to bring a significant amount of savings and efficiency to our customers,” Carranza said. “We have the opportunity to make one of the most efficient grids in the world here in the UK and it is an opportunity we should be looking at.
“I’m very confident about the UK Government, they have a clear understanding that something had to be done to create a sustainable way for citizens. Every time we discuss with them, the messages we get are very clear. Obviously, there’s always delays in politics, and we need to translate these discussions into real, regulatory frameworks, but the direction to take is understood.”
Analysis from the Carbon Trust suggests that energy storage could contribute £2.4bn to UK electricity system savings by 2030, but only if a range of ‘necessary regulatory reforms’ are introduced to steady the UK’s energy market, a belief shared by Carranza.
Carranza claimed that support for energy storage derived from a “bottom-up approach”, whereby the public were demanding new ways to source and manage energy, an ideate that was yet to be complimented by robust policy frameworks.
Nissan, who has worked on UK vehicle-to-grid trials in the past, believes that there will be around 20 million electric vehicles (EVs) in circulation by 2030, and that the batteries of older vehicles would complement energy storage systems by being reused.
However, if new decentralised and closed-loop models for energy use are to emerge, Carranza claimed that “seamless regulatory frameworks” would need to be established.
This view was mirrored by the REA’s chief executive Dr. Nina Skorupska, who claimed that the upcoming General Election had left regulatory suggestions relating to battery storage “circling the landing strip”.
Skorupska noted that both the Department for Business, Energy and Industrial Strategy (BEIS) and regulators Ofgem were “excited” about the technology, but recent political decisions had halted momentum, to the detriment of industry confidence.
“Modelling is showing that energy storage, in all of its guises, can deliver incredible savings,” Skorupska said. “All of the things that we hoped could’ve started to motor forward following the referendum last year, like the call for evidence for flexible energy systems from BEIS and Ofgem, are circling the landing strip.
“It would be really strange if a new government came in to rip up the thinking behind energy storage and the Industrial Strategy. We’ve even heard inklings from the Labour party that energy storage sounds like good sense. But at the moment, we can’t bring this down [to the landing strip] to enable the industry to engage.”
According to Skorupska, mentions of energy storage in the Industrial Strategy, and the positive engagement from Ofgem, would act as the “lighthouse” for energy storage. It is now the job of the industry to use this momentum as a “beacon” that highlights the confidence in the technology, she added.
Lead by example
Eaton is partnering with Manchester City Football Club to launch of a limited edition of Eaton’s xStorage Home. The model will now join systems from the likes of Tesla and Mercedes-Benz in the UK market.
In fact, SmartestEnergy claims that battery capacity in the UK could grow by 100-fold by 2020. Independent developers have won four fifths of battery contracts in capacity market auctions, securing 407MW compared to just 105MW with the “Big Six” firms.
Speaking exclusively to edie, Eaton’s head of energy storage business unit Stephanie Ordan claimed that the UK was an attractive market for energy storage due to the need to retrofit aging infrastructure, the increased uptake of renewables and the commercial ability to support growing technologies.
“The UK is a market with more risk for outage and less margin between peak demand and capacity from the grid,” Ordan said. “At the same time, you have a very solid base of renewables in the UK which is a significant buffer than can be used with the storage to contribute to the decentralisation of the grid.
“The capability to remove the upfront commercial burden of both residential and business costs for energy storage is here in the UK. By removing the financial burdens, you get the proof points of savings. The UK can lead by example to help with the adoption of energy storage.”