Setting the stage for energy storage

How battery storage plays a central role in the smart grid

The energy transition is in full swing as the share of renewable energy sources such as wind power or photovoltaics continues to increase. However, a major drawback of renewable energy sources is that their energy production does not always cover the current electricity demand, as it is highly dependent on changing environmental factors such as weather and climate. Connecting these energy sources to a battery storage system can therefore help to cushion the fluctuations in energy generation. Widespread adoption of this decentralized flexibility will help renewable energy achieve a breakthrough. But there are still some hurdles standing in the way of large-scale use of the valuable flexibility potential of these new technologies: On the one hand, huge investments need to be made in upgrading the aging transmission grids and lowering some of the energy market's barriers to entry. On the other hand, new regulations and standards must be implemented.

Battery storage provides more flexibility

On the one hand, battery storage is a prerequisite for the success of the energy transition, but on the other hand, it is also a must for residential and industrial customers if they want to achieve decarbonization of their energy consumption. It also saves them money in the long run. Battery storage has become much more affordable in recent years due to increased demand, opening up new application possibilities. One of the main reasons for the widespread adoption of this technology is the resulting gain in flexibility for all players in the energy market.

Flexibility facilitates energy optimization

The amount of electricity generated from renewable sources cannot be adjusted to demand or market price. However, battery storage makes it possible to create some flexibility on the consumer side as well. This flexibility can be used to take advantage of periods of energy surplus, with favorable electricity prices, while mitigating shortages. Utilities and large industries can adapt to the new market realities by digitizing their operations and managing loads with demand-side management. On the other hand, consumers can now optimize their energy balance, gain more independence from grid power, and even have a backup system in case of a blackout. As a rule of thumb, those who have a high proportion of flexible power are able to obtain cheaper energy from an intraday trading market and minimize overall energy costs. With benefits for all stakeholders, demand-side flexibility is an important success factor for the long-term operation of sustainable energy systems.

Flexibility can cushion peak loads

Optimizing flexible energy can also be a promising solution when it comes to capping peak loads. Let's take an example where a solar system provides the energy supply and a battery storage system provides the flexibility. The battery charging process is not simply based on the time of day or the position of the sun, but can also take into account the load on the grid. The electricity from the morning sun is first fed into the grid. Only when there is a surplus of electricity around noon is the solar power finally stored in the battery until it is fully charged. In this way, a grid-optimized battery can help relieve the load on the power grid. What applies to this use case also applies to an entire energy system. System-wide access to stored energy, which can be traded on the power exchange using an algorithm, opens doors for other types of optimization. The grid can be relieved of peak demand that occurs by anticipating electricity-intensive periods and regions. By lowering the cost of energy for selected time windows, electric utilities can provide additional incentives on the demand side, resulting in evenly distributed electricity consumption.

Energy storage in smart grids

While integrating energy storage into traditional energy grids can be challenging at present, the smart energy grid of the future will be built around it. Energy storage will need to be given a clear classification to provide an effective regulatory and financial framework for their use within a smart grid. When properly deployed, energy storage technologies can offer significant opportunities to improve grid efficiency and operations. Their ability to provide energy power on short notice allows them to respond quickly and effectively to signals throughout the energy grid. Therefore, widespread implementation of energy storage will play a critical role in the operation of the smart grid.

There are still some to-dos

A major problem that has slowed down renewable energy so far is the aging infrastructure of most power grids, which cannot be renewed overnight. It was designed and built several decades ago based on the type of power generation that was common at the time. This was based almost exclusively on huge, centralized power plants, most of which ran on fossil fuels. Renewable energies, on the other hand, have other characteristics such as limited availability and plannability. They also tend to be based on a broad network of smaller power generation facilities, such as wind and solar farms. The only way to deal with this is to make massive investments in upgrading power grids, which must be organized and financed by transmission system operators, utilities and governments. Numerous reforms must also be initiated on the regulatory side: On the one hand, deregulations should lead to increasing revenues, a higher degree of competition and more precise prices for storage capacities, which will contribute to a cost-efficient use of the flexibility potential of battery storage. On the other hand, new regulations need to be created to ensure non-discriminatory access to the energy market and to have an updated system of surcharges and fees.

The new era of battery storage

t is important what happens at the higher level in terms of regulations, standards and modernization of the electricity infrastructure. But it is also critical to continue to develop and improve battery storage, as it will play a central role in the smart grids of the future. Neoom's battery storage systems have been designed precisely to generate savings for the consumer by optimizing self-consumption and intercepting peak loads. This dual mode of operation achieves the greatest possible savings in electricity costs. This is also made possible by NTUITY®, the integrated energy management software. This intuitively controls and automates the entire energy infrastructure, regardless of manufacturer and location. With its help, consumers, generators and storage facilities can be monitored and controlled in real time at any time and from any location. The improved efficiency and functionality of storage modules is one side of the coin, but battery storage will only be able to develop its full potential and make a major contribution to the energy transition if it is deployed on a large scale. This is only possible if the technology is constantly developed further and both companies and private customers jump on this trend and rely more on battery storage.