Modo Energy’s Post

In August, batteries in Great Britain earned the most revenue from wholesale trading and the Balancing Mechanism since December 2022. This helped increase total revenues by 42%, with revenues matching the monthly figures from April and June. The increase was partly driven by a 55% increase in price spreads - due to an increase in gas prices and wind generation. Meanwhile, in the Balancing Mechanism, batteries were dispatched for a record 1.4 GWh of Offers each day, despite in-merit dispatch rates for batteries in the Balancing Mechanism increasing only slightly to 10.5%. This led to August reaching a record-high for a single month of Balancing Mechanism revenue for batteries. Read the full article on the Modo platform to find out more about what changed for battery revenues in August - link here: https://lnkd.in/ewx5X63M

Battery energy storage revenues in Great Britain increased by 3% in February to £22.6k/MW/year. The GB BESS index increased following three consecutive months of falling revenue. Lower wholesale revenues were more than offset by increased Balancing Mechanism and frequency response revenues. Rising Dynamic Regulation High prices caused frequency response revenues to increase by 6%. Wholesale revenues fell 3%, as average wholesale day-ahead spreads reduced to £40/MWh, 20% lower than January levels. In-merit dispatch rates for batteries reached 6.5%, up from 4.5% in January. This follows improvements to the Bulk Dispatch functionality the ESO uses to instruct batteries. As a result of these improvements, a record 1.5 GWh of battery Bids and Offers were dispatched in the Balancing Mechanism. This caused Balancing Mechanism revenues to rise 11% to £7.5k/MW/year, their second-highest figure ever.

Battery revenues fell by 26% to £39k/MW/year in July. Here's why lower wind generation was key to this. Wholesale spreads averaged £47/MWh in July, a 22% reduction from June. After 16 hours of negative prices in the first week of July power price minimums increased throughout the month. This was due to a sharp decline in wind generation, which averaged 6 GW in the first half of July but fell to 3.5 GW in the second half of the month. National demand reached its lowest level in 2024 on July 27th, but coincided with just 500 MW of wind generation, meaning power prices remained high. The low trading value caused by reduced spreads meant batteries earned £9k/MW/year less from frequency response services in July than in June. In the Balancing Mechanism, batteries were heavily utilized for Bids, and imported 400 MWh more than they exported each day in July. This meant that Balancing Mechanism revenue halved, but revenues from wholesale trading remained stable, as batteries sold the excess energy in wholesale markets. #BatteryEnergyStorage #NetZeroTransition #BalancingMechanism

Battery energy storage revenues in Great Britain fell 12% in November after reaching their yearly high in October. Batteries earned £51.9k/MW/year in November, as revenues from wholesale trading and frequency response fell sharply. Imbalance revenues - which are new to the ME BESS GB Index - also decreased. This was partially offset by the second-highest Balancing Mechanism revenue in 18 months, as batteries were dispatched for a record 3 GWh of Balancing Mechanism volume daily. The reduced revenues were due to lower wholesale price spreads, which fell to £74/MWh. This is still their second-highest level this year after prices spiked on November 6th due to tight power margins. You can read the article to find out more, including why Balancing Mechanism revenues and dispatches increased in November. https://lnkd.in/ed7N4NEf

Battery energy storage revenues increased by 25% in June to £49k/MW/year. Negative power prices returned this month, but what else impacted battery revenues? Wholesale price spreads increased by 34% to £59/MWh, their highest monthly average since December 2023. This led to a 34% increase in wholesale revenue, rising to £17k/MW/year. This was largely due to the return of negative power prices, driven by a 20% increase in average wind generation. There were 18 hours of negative pricing in June, bringing the yearly total up to 83 hours. That’s only 23 hours less than in the whole of 2023. Meanwhile, gas and carbon prices increased by 10% and 16% respectively. This caused peak power prices to rise in June, further increasing wholesale prices and spreads. The higher value in wholesale markets resulted in frequency response prices rising by 77%, as operators increased their bid prices. This resulted in frequency response revenues increasing by £8k/MW/year. Meanwhile, Balancing Mechanism revenue remained at £8k/MW/year, despite an increase in battery dispatches. That’s because most of the increase was in Bids (where they pay for energy) - June saw a record 1.2 GWh Bid volume daily for batteries. The in-merit dispatch rate for batteries increased to 10.1% after a reduction in May. You can read the article here: https://lnkd.in/eSfbqxd4 Modo Energy subscribers can read the full article to find out more, including how the top-performing strategies differed based on battery location. #BatteryEnergyStorage #EnergyTransition #BalancingMechanism

Batteries in Great Britain stack revenues from multiple markets across multiple timeframes in order to maximize returns - but the value of these change continuously. Understanding each of these markets and how they will evolve is therefore critical to building an effective business case for battery energy storage. Two years ago, frequency response accounted for 80% of all battery revenues. Today, that has fallen to just 10%. Wholesale trading is now the dominant revenue stream for batteries, but more attention has been on the Balancing Mechanism. More effective dispatch of batteries should grow the importance of the Balancing Mechanism for batteries - in 2027 30% of all battery revenues could come from this revenue stream. GB BESS Outlook subscribers can read the full BESS Market Outlook to get the lowdown on every market batteries operate in, and how these are forecast to change. Find it on the platform here: https://lnkd.in/e8nwPtyQ

By 2027, the largest battery in Britain will have 10x the power capacity of the current largest battery. But how do revenues for larger systems compare to existing batteries? Currently, three batteries - Capenhurst, Clay Tye, and Dollymans - have a rated power of 100 MW. The first batteries with a rated power above 300 MW could come online next year, with systems of up to 1GW online by 2027. These batteries face ramp rate restrictions that could mean they see lower wholesale revenues per MW. Under the Grid Code, generators are restricted to ramping at 50 MW per minute for dispatches above 300 MW. This helps to ensure grid stability, but limits the amount of energy that batteries can trade - particularly over shorter dispatches. However, larger batteries can minimize this revenue impact by performing more infrequent but longer trades. Because of this, a 1 GW battery might only earn 3% lower wholesale trading revenue than a 300 MW system per MW. There are other effects too - large batteries could also have market-moving effects on power prices and be dispatched differently in the Balancing Mechanism. To read more about the impact this has on revenues, head to the article: https://lnkd.in/etvhe5u7

Battery Cyclers Market It will grow to $1.18 billion in 2028 at a compound annual growth rate (CAGR) of 14.4% Read More @ https://lnkd.in/ggebHbPw #marketresearchreport #marketresearch #marketintelligence #marketreport #industryanalysis #TheBusinessResearchCompany #TBRC #BatteryCyclers

When power suppliers compete in a wholesale electricity market, customers save money. FirstEnergy expects a 27% reduction - $101.08 per MWh down to $73.89 per MWh - in wholesale power costs compared to last year, which will be passed on to thousands of Ohioans starting this June.   Read more: https://lnkd.in/dsiBANux #powermarkets #ohio

Batteries Are Transforming the Way the U.S. Uses Electricity - Once upon a time the business leveraged the Californian primary Aluminium Smelters' cheap electricity longterm contracts by shutting down the smelters and selling the electricity onwards at profit. Now smart business is leveraging the fact that the wind and sun are not available all the time. Batteries are being used to address peak demand periods. Over the past three years, the US battery storage capacity has grown tenfold, to 16 Gigawatts. It is expected to nearly double again during 2024. More in the NYT article from 7 May 2024 below -