Battery energy storage systems (BESS) achieved the second highest daily total revenue so far in 2024, peaking at £250/MW on 21 August.
Analysis from Modo Energy found that this figure is slightly lower than the £258/MW batteries earned to balance the grid on April 16, and further suggested that the sales increase is the result of multiple periods of negative wholesale prices for energy in August 2024.
Day-ahead wholesale electricity prices fell below zero for 49 hours in August, a volume second only behind April this year, when prices were negative for 53 hours. According to Modo Energy, 34 hours of negative prices occurred between August 20 and 26.
So far in 2024, Britain has seen prices fall below zero for a total of 147 hours – 44 more than in all of 2023. Modo Energy predicts that the number of negatively priced hours will total 188 hours by the end of the year.
This increase in negative price periods contributed to an increase in BESS revenues for the end of August, with low wholesale price minimums increasing wholesale revenues and frequency response prices.
At around 1pm on 21 August, the UK BESS systems supplied over 600MW of power to the grid via the Balancing Mechanism, increasing the retail price to £47/MW, on top of their wholesale and frequency response revenues.
BESS is essential for balancing the electricity grid
As the net-zero transition continues to accelerate, BESS is becoming an increasingly important part of balancing fluctuating generation from solar and other renewable sources.
Modo Energy’s analysis found that periods of high wind generation, combined with low demand, were a large part of the reason for negative wholesale prices throughout the year. During these times, batteries could charge cheaply and later generate significant revenue by selling stored energy back to the grid during periods of higher demand.
To meet the increasing need for grid balancing support, Solar Energy UK has forecast that a further 30GW of energy storage will need to be brought online by 2030, in addition to 50GW of solar capacity.
The future of BESS development in Britain looks positive, with Ernst & Young’s (EY) latest Renewable Energy Country Attraction Index (RECAI) ranking Britain as the third most attractive BESS market in the world.
The UK BESS pipeline has reached 95 GW, an increase of 67% from 2023. Several major projects have been announced or proposed in recent weeks; EDF Renewables UK has unveiled plans to bring more than 300 MW of BESS projects online over the next 12 months, with a 200 MW/400 MWh, 2-hour project near Carlisle recently granted planning permission by the Cumberland Council.
