January 18 2021
Mike Lanigan, Moixa
Residential and Commercial Energy Storage Working Group Chair
What a year 2020 was. Coronavirus, Brexit, political turbulance in the US, and the ever-increasing gravity of climate change’s global impact. The extent to which the status quo worldwide has been changed is unprecedented in recent years, and with so much rapid change comes a lot of uncertainty. We go into 2021 with a government seemingly committed to driving a green agenda, but with the uncertainty of Coronavirus and the reality of Brexit still weighing over us.
This year is critical for addressing the climate emergency, with the UK hosting COP26 – helping to set policies for the world, on renewable energy, electric vehicles, household energy efficiency and low carbon technologies. The key question is how can British households help as well as benefit from these new technologies?
As the market for small scale storage increases, the role of software both to optimise batteries as well as aggregate into large fleets for grid services will drive additional value. Moixa is already seeing this in countries as far away as Japan where Moixa’s GridShare software connected over 25,000 small scale residential batteries, forming 250MWh of storage with a potential of 100MW of flex – equivalent to larger solar farms and power plants. The technology is at an inflexion point and will rapidly grow to managing GWs or ‘Virtual Hinkley’ levels of power, helping to deliver on COP26 and UN sustainability targets for low carbon energy.
Also, with many of us spending more time at home and seeing our electricity bills rise, we see the potential for a significant revival of solar installations, as well as smarter batteries benefiting from an increased availability of Time of Use (ToU) and electric vehicle off-peak tariffs.
In terms of incentives, we believe the key policy levers to facilitate small-scale storage will include zero interest loans / grants, using the Building Regulations to incentivise storage in new builds, inclusion of storage in the Green Homes Grant (GHG) and extending the 5% VAT on solar to storage-only installations as well.
Further structural changes to facilitate the small-scale storage market include development of MCS battery storage standards, development of domestic flex markets for participation and the recognition of storage by DNOs beyond simple generators (i.e. ability to import and export energy and provide grid services).
Recent government announcements on grants and incentives to decarbonise homes has been welcomed, but key technologies such as domestic energy storage systems (ESS) are yet to be included.
2021 will also see the continuing escalation in the uptake of electric vehicles (EV). This will provide opportunities for grid management and balancing with the rapid increase in kWh of available energy storage. However, we need to be able to aggregate and manage these EV batteries properly to support grids or they will risk becoming an enormous challenge that will literally ‘choke’ the DNOs. We need level heads, clear policy and a focus on how we build the grids of the future.