LONDON — Europe needs an immense rollout of energy storage and other flexible energy resources if it’s going to hit its 2050 net-zero target. As of today, the market largely remains stuck.
To date, Europe’s big successes on the energy storage front have come from tenders to provide frequency response and other grid services. But those needs have largely been met; prices have fallen and a very short-lived boom has busted.
The decline was accelerated by better integration of Europe’s markets, allowing assets in one country to provide services in others.
“Let me tell you a secret from continental Europe: Batteries are dead,” said Jochen Schwill, CEO of virtual power plant operator Next Kraftwerke, speaking at the recent Energy Storage Summit in London.
Prices on the frequency and primary reserve markets have been halved, Schwill told attendees. “It’s not working anymore,” he said. “When it comes to short-term flexibility, I think we have enough in the market.”
“When we take nuclear power and coal offline in Germany and add in renewables, the market might then send the price up again; we will see.”
The market can, of course, get things wrong, he added.
In any case, things had better start improving for Europe’s storage market. Recent research by Wood Mackenzie found that Europe is going to need 118 gigawatts of flexibility to balance out 298 gigawatts of variable renewable generation expected by 2040. That includes demand-side response, interconnectors and gas peakers as well as energy storage.
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