UK must invest in energy storage now to avoid higher bills in the future

by Search Gate staff. Published Tue 21 Apr 2015 10:30
“Energy storage is a potential game changer for how the UK prices energy"
“Energy storage is a potential game changer for how the UK prices energy

The next UK Government faces huge energy challenges that have the potential to not only influence the next several years but the long term future of the country’s energy economy.

Phil Taylor, Professor of Electrical Power Systems and Director of the Institute for Sustainability at Newcastle University, says if the government is going to address fair pricing of energy for consumers – a major debate in the run up to the election – then changes in energy regulation and policy are needed to make the price of energy reflect the current grid carbon mix, and demand should be more flexible to match low carbon generation.

“Energy price freezes are a temporary solution to a much bigger, long term problem that is also about energy efficiency, reducing energy usage, the UK’s carbon footprint and our dependence on fossil fuels. If the government is serious about cutting energy prices then it needs to address the bigger picture of energy usage through regulation, and upgrade UK energy policy and infrastructure to deliver a new model for energy pricing that addresses inefficiency and ways to save energy.”

In the run up to the UK General Election parties have included in their manifestos the importance of reducing energy usage. Researchers at Newcastle University find that this can be partly met through smart grid technologies, such as demand-side response, to help people reduce their carbon footprint and save on their energy bills. Energy storage can also play a large role if the UK’s convoluted energy market is simplified.

“Energy storage is a potential game changer for how the UK prices energy. It can also provide many services to the grid to make the UK’s energy future more efficient, secure and lower in carbon emissions.”

The UK has a massive opportunity to become a global leader in energy storage similar to what Germany has done for the deployment of renewable energy generation, but there are steps that government needs to take in order for the country to realise the wider benefits of energy storage for the economy.

While some parties have acknowledged the importance of energy storage, they have not said how energy storage will be deployed, nor addressed the market and regulations that hinder its benefits from becoming a reality.

Prof Taylor recommends that the next government needs to give energy storage its own asset class allowing it to proliferate across the country. He argues that the UK energy market has been made overly complicated by a fragmented energy industry that separates generation from storage, distribution and supply.

“If energy storage was given its own asset class with accompanying rules for appropriate regulatory treatment, it could offer significant benefits to the UK’s energy network such as balancing supply with demand, reducing greenhouse gas emissions and hedging against fluctuating energy prices that lead to fuel poverty.”

There is also the possibility of providing feed-in tariffs or stimulus packages to reduce pay back periods for energy storage, the same way they have been used to pay back solar panels or other forms of renewable energy generation more quickly.

Prof Taylor says: “The next government should be making pre-emptive investments in our energy infrastructure, including storage, based on an anticipated future need as opposed to waiting until either the need arises or there’s a delay in the low carbon transition, and then suddenly trying to mobilise an energy deployment project. They must look beyond the next election and make long term, carefully considered decisions about energy policy which can remain in place for periods much greater than our current electoral cycles.

In the future countries that decarbonise the most rapidly will likely look more attractive for inward investment and places for businesses to setup. If the UK invests in energy storage now it will promote job creation, social development and the economy for years to come. As carbon becomes more expensive the investment in energy storage infrastructure will make the UK more competitive internationally.

The UK’s timeline for investing in energy storage is its low carbon transition. The next government will need to ask what storage do we need? Where should it be placed? And what types should be used?

“It’s collaborative planning with pre-emptive investment that is required to secure the UK’s energy future and storage is an example of not only achieving a more sustainable energy supply, but making the UK economy more competitive, encouraging businesses to set up here," says Taylor.

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