New rules paving the way for increased use of batteries for electricity supplies should ease bottlenecks in the system and potentially cut prices in the long term, according to an industry figure.
Regulations coming into effect next year will give certainty to businesses seeking to invest in long-duration battery storage in the Republic, triggering an upsurge in interest in this business, according to Seán McGrenaghan, finance partner with law firm DLA Piper.
Financiers and banks will be more willing to invest in, and lend to, battery projects here as a result of the rule change, said McGrenaghan, whose firm has worked on deals involving this technology for Irish businesses working in the UK and Europe.
Increasing the number of batteries on the Irish system will allow greater exploitation of wind and solar power, as they can store excess green electricity generated at times when demand is low, and supply it when the energy is needed.
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The change comes as industry bodies such as Wind Energy Ireland highlight that bottlenecks on the national grid are forcing renewable electricity off the system.
That organisation has pinpointed long-duration storage as one of several solutions required for this problem.
The technology will allow wind and solar farms switched off as a consequence of grid problems to generate electricity for use at times of peak demand.
McGrenaghan also believes that the introduction of more batteries could help cut Irish electricity prices, which are now the highest in the European Union, over the longer term.
“If there is more power being generated in aggregate, that should bring pricing down over the course of a year,” he said.
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Battery development is advancing quickly. The technology is now capable of storing 100 hours worth of electricity, as against two or three hours just a few years ago.
The new systems are typically built alongside solar and other renewable plants, and included as part of the financing for these projects, said McGrenaghan.
The Republic has batteries capable of supplying 1,000 megawatts in total on its system, but this is all older, shorter-duration technology.
McGrenaghan estimated that there is about eight times that capacity in planning, but developers have been holding off for the introduction of rules that would give them certainty on revenue generation.
The new Future Arrangement System Services framework will allow battery owners to “arbitrage”, that is, buy electricity when low demand depresses prices and sell it when they rise alongside demand.
That will bring the Irish system into line with other European networks, such as those in Germany and Britain, where long-duration batteries are already part of the system, he added.
