Battery energy storage systems, perfect allies for Europe’s energy transition | NTT DATA

Wed, 29 May 2024

Battery energy storage systems, perfect allies for Europe’s energy transition

The search for cleaner and more efficient energy production is a commitment embraced by the entire energy sector. In this context, the rise of storage systems on an industrial level can become a perfect ally, the BESS systems (Battery Energy Storage Systems). NTT DATA, a global leader in IT business and services, has presented its whitepaper "Finding opportunities in Europe’s Battery Energy Storage Systems (BESS) Market" in which it identifies growth and development opportunities in the sector.

On one hand, Europe, in its ambition to achieve net zero emissions, revised the EU Renewable Energy Directive, which sets a binding renewable target of 42.5% for 2030, representing a considerable increase from the previous target of 32%. To achieve these goals, a greater investment in digital technologies and new assets will be required to provide more flexibility in energy generation and meet consumption demands. This is where BESS systems play a fundamental role, as renewable energies, whose capacity, and production depend on weather conditions, cannot guarantee a constant electricity supply or reliably respond to peak demands. But these systems can store electrical energy during times of low demand to supply it during high demand, which helps reduce high energy demand peaks and optimize the use of the power grid.

On the other hand, the objectives regarding renewable energies with high expectations are leading many countries' grids to a critical turning point, and the increasing levels of renewable generation and the lack of improvements in the grid create an urgent need to increase storage capacity in national grids. In this case, BESS act as a hybrid solution for renewable energy plants and transmission grids, providing energy and ancillary services to the grid.

Opportunities in a developing market

The development of the market for these systems and the evolution of battery technologies are creating new opportunities along the energy value chain. Despite challenges such as high initial costs, large-scale BESS projects offer significant opportunities, especially when considering all possible sources of long-term revenue. For this, a centrally coordinated market that offers independent power producers (IPP) opportunities to provide ancillary services to the grid operator would be ideal. The interesting aspect is to reach a mature market with a well-established framework and mature products, as well as a clear regulatory framework.

Report - 20 min read

Finding opportunities in BESS Market

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