European energy storage developers have until the end of this month to submit proposals for projects in a new 10-year transmission system operators plan.
But the minimum requirements imposed by the European Network of Transmission System Operators for Electricity (ENTSO-E) mean that only a small number of projects might be eligible.
ENTSO-E, which represents 41 system operators in Europe, announced the search for energy storage plants at the end of last month as part of a 10-year network development plan.
The plan, updated every two years, acts as the basis for a list of so-called "projects of common interest" to better integrate the grid across the European Union.
To be eligible for inclusion, a project has to be at least partially located in one of the 34 countries represented within ENTSO-E, and needs to have a minimum 225-megawatt installed capacity and generation capability of 250 gigawatt-hours per year.
Bloomberg New Energy Finance associate Logan Goldie-Scot said the project parameters were likely to favor large-scale technologies such as compressed air energy storage (CAES).
“The requirements for the bid seem to limit the potential technologies involved, since battery technologies have yet to be deployed at that scale,” he said. “This suggests the bid is targeted at CAES projects, which have struggled in recent years to be developed."
Goldie-Scot continued: “Also, the projects of common interest require the project to benefit two countries, and most storage projects are very focused on specific regions, rather than cross-border.”
In ENTSO-E’s last 10-year network plan, issued in 2014, energy storage was included alongside transmission plans for the first time. With 22 transmission and smart grid proposals, 11 storage projects totaling almost 5.7 gigawatts were admitted for assessment.
Of these, nine were related to pumped hydro storage, with the largest being the Tarnita-Lapustesti project currently courting Chinese investors in Romania.
ENTSO-E reported that the battery storage plant and a 313-megawatt pumped hydro proposal in Austria both failed to qualify as projects of common interest.
Conversely, there were four projects whose promoters did not submit information to ENTSO-E. Three of these were for pumped hydro projects, while the fourth was for a battery storage system in central south Italy.
Project applications submitted this month will go through a two-month public consultation process over the summer. If accepted, they will form part of a final list of transmission and energy storage projects included in the 10-year plan for 2016, published in September.
The projects will then be subjected to a cost-benefit analysis covering socioeconomic welfare, impact on security of supply, integration of renewable energy sources, emissions reductions, and impact on transmission losses and system resilience.
Even though the 10-year plan issued in 2016 will likely only benefit a few large projects, the fact that they are included at all demonstrates how European TSOs now see energy storage as a significant part of the answer to what seemed like alarming grid problems that began to emerge a few years ago.
In its 2014 report, ENTSO-E noted: “80 percent of the proposed investments address RES integration issues. […] Storage projects in particular create substantial capacity and flexibility in the power system that will be better reflected in their assessment in the future.”
The report continued: “Typically, distributed storage solutions are today no alternative solution to transmission grid development as their capability…is about 100 or 1,000 times too small compared to transmission grid requirements.”
Not everyone appears to agree with that view.
Responding to the 2014 assessment, for example, the European Association for Storage of Energy said that inclusion of storage doesn't necessarily mean that it should be on the utility side of the meter.
The association pointed out that energy storage “can be located at all places along the electricity value chain (generation, transmission, distribution, and customer) and can provide simultaneously specific value to the different stakeholders.”
Doug Staker, vice president of global sales at the storage project developer Demand Energy, told Greentech Media: “There is a great debate on grid-scale, distribution-level, or load-level integration of storage. It is all a matter of mindset and comfort, but if you look at it from a perspective of driving the most value, we believe a distributed model that is virtually aggregated to grid scale is a better path forward. To continue to follow the large generation-transmission model of grid design overlooks the lessons from telecom that a distributed operational model is more effective and resilient."