Investors are now becoming more comfortable with battery storage, with projects being profitable and cost-effective, according to industry experts.
Speaking at the Energy Storage Network’s Annual Marketplace, Alicja Kowalewska-Montfot, commercial manager-energy storage at Gore Street Capital, said the asset owner had established a “very strong” retail base of investors, who would typically be more risk averse to newer technologies and that are now getting comfortable with this sort of asset class.
This in turn is showing that investors are getting more comfortable with the associated merchant risk and understand that in the absence of long-term or government-backed contracts, “they are indeed capable of functioning in the context of the fundamentals that are happening in the market, so the growth of renewables”.
She added that what is “incredible” about battery storage is that it never had a subsidy. Other clean energy technologies such as wind and solar have benefited from support schemes such as the Contracts for Difference (CfD) scheme, and while some solar and wind farms are now subsidy-free, a new round of the CfD opened in December.
“This to me is one of those very interesting stories of a technology that effectively proved to be capable of being merchant and unsubsidised pretty much from day one,” Kowalewska-Montfot said.
Indeed, managing director and head of Gresham House New Energy Ben Guest said: “It’s a cost-effective technology, and a reliable technology which is resulting in profitable, unsubsidised projects so clearly it’s an area that’s standing on its own two feet.”