National Grid has issued a warning to battery storage developers that it would expect them not to rely solely on grid balancing markets for revenue.
The warning came during an industry event organised by trade body Regen to launch its ‘Energy Storage: the next wave’ report, published last week.
The system operator’s head of business development Claire Spedding spoke at the event, insisting that now was a “really exciting time” to be at National Grid considering the significant changes that are occurring within the power market.
“Last summer we saw a huge increase in the amount of solar on the system and it was a completely different way of operating the system. We will never go back again to the way we used to operate the electricity system.
"Things are going to change and they’re going to change rapidly. It’s really important that we’re prepared for the change and that we can move rapidly with it as well,” she said.
Battery storage has risen to the fore as being a potent weapon in National Grid’s balancing arsenal. It procured 200MW of capacity through the Enhanced Frequency Response mechanism and continues to source additional capacity from batteries through monthly Fast Frequency Response contracts.
But having kick-started the market, Spedding warned of looming saturation and insisted developers be flexible when it comes to stacking their revenue streams.
“I would make one appeal, which is: don’t put all of your eggs in one basket and build your entire business case around FFR.
“It’s a small part of the opportunity that’s available. FFR is a finite market. It’s getting increasingly competitive and as you get more participation in the market the prices are going to cool down and we need to be looking at other revenue streams and stacking revenue streams together,” she said.
For a full account of Claire Spedding’s remarks and the Regen event in general, visit our sister publication Energy-Storage.News.