Electricity storage in Europe and the UK - the regulatory landscape

Both the EU and UK aim to achieve net zero by 2050 and are either taking steps (the EU) or already have enshrined this target in law (the UK). In the shorter term, the EU is currently increasing its 2030 targets to a 60% reduction, and the UK set out a 57% reduction in its 2016 in the fifth carbon budget. The majority of these carbon reduction efforts is envisaged to be secured through renewable energy sources.  However, to achieve such targets, it will be essential to ensure the effective and wider deployment of electricity storage and other energy efficiency technologies, to allow for the further expansion and reliance on renewable energy sources such as wind and solar.

In the peer-reviewed paper published on OGEL “Power Storage in Europe - The Regulatory Landscape of Electricity Storage at a European Level and in the UK” Silke Goldberg and Jannis Bille are examining the regulatory landscape for electricity storage in the EU and UK, identifying possible hurdles for the deployment of storage facilities and address future developments in this space.

Background

Efficient energy storage is relevant to a wide array of sectors and fields, however, with regard to the electricity industry, it will be an integral building-block for the viability of key renewable energy sources such as solar and wind, which by their nature are only intermittent electricity generators. Similarly, storage would generally enable network operators to balance the grid more easily when faced with a greater proportion of intermittent generation, allowing for the system to adapt better to capacity peaks and lows, avoiding potential outages and contributing to a more efficient running of the network. Concurrently, storage will arguably allow for a more sustainable approach to energy production, as excess generation would not be lost but could be stored and released back into the network at a later time, therefore reducing the need for additional generation. In a system where energy from fossil fuels still plays a role, this could contribute to a considerable decrease in the consumption of fossil fuels and related carbon emissions.

While there are multiple storage technologies on the market, the probably the most publicity has been attracted by Battery storage and with it the wider application of storage within the transport sector and its planned transition away from combustion engines towards an electric solution. Being an important contributor to greenhouse gas emissions in the UK and Europe, it is essential to decarbonise the transport sector to meet national and international emission reduction targets to combat climate change. With car manufacturers being engaged in a race to the most effective battery storage solutions, electric vehicles (EVs) are an important part of the roadmap towards meeting these targets.

Regulatory hurdles to the deployment of storage

There are a number of hurdles to the effective deployment of storage across Europe and within Member States due to the applicable regulatory systems and an inherent lack of clarity. In relation to the wider application and deployment of storage the regulatory system will need to be further defined to improve investor certainty and further increase the business case for electricity storage. This will require more regulatory attention both on an EU and Member State level, as well cooperation between the two.

In addition, the large-scale rollout of industrial size storage in the form of large and small scale battery storage within different industry sectors will require appropriate regulation to deal with the unique features of such the different applications of storage (such as a mobile form of storage), including minimum standards, industry codes and specific legislation. In the case of battery storage, in particular in relation to EVs, this will have to go beyond the existing Batteries Directive and will need to address key areas of life-span and safe and effective decommissioning.

For more detail on the topic of EU and UK regulation of electricity storage please see our article in the OGEL Journal here.