The ESO has published its annual Future Energy Scenarios report for 2024. This report outlines potential pathways to net-zero carbon emissions by 2050. So, will battery capacity meet any of the pathways set out by the ESO?
The switch from ‘Scenarios’ to ‘Pathways’ focuses on narrower routes to net-zero
The Future Energy Scenarios report has a narrower scope in 2024. This has allowed the ESO to focus on more credible pathways to net zero, after the 2023 report sought ‘the edges of credibility’.
In 2024 the report explores three pathways: Holistic Transition, Electricity Engagement, and Hydrogen Evolution.
- Holistic Transition: A highly flexible power grid, mixing electrification, storage, and demand response with hydrogen to achieve this.
- Hydrogen Evolution: A less flexible system, as hydrogen is used more for power and energy storage.
- Electricity Engagement: Involves the least hydrogen use, with high volumes of nuclear energy reducing flexibility
The ESO has included a ‘Counterfactual’ pathway which fails to meet net-zero by 2050.
Fast battery buildout provides crucial flexibility in all pathways in the next five years
The Future Energy Scenarios pathway with the highest level of grid flexibility set out by the ESO (Holistic Transition) involves the fastest rate of battery energy storage buildout. The Holistic Transition pathway requires 27 GW of battery energy storage by the end of 2029. This would require 23 GW of battery energy storage to come online in the next five years.
That’s 5 GW more than the ESO predicts in its five-year forecast, which falls short of both the Holistic Transition and Electric Engagement pathways. The forecast predicts providers will build enough battery energy storage to match the Hydrogen Evolution pathway, which requires the lowest volume of battery energy storage of all pathways, and reach net zero in 2050.
Current battery buildout rates could miss all three Future Energy Scenario pathways
Recent battery energy storage buildout rates have slowed. The first half of 2024 saw the lowest new operational capacity since 2022, totaling 370 MW, due to delayed projects. Battery providers have attributed some recent delays to connection delays at the DNO level, commissioning testing issues, and equipment issues.
Factoring these delays into Modo Energy’s five-year forecast for battery buildout means battery capacity in 2029 would be 20 GW. This figure would miss all three net zero pathways set out by the ESO.
The ambitious pathways demonstrate the importance the ESO places on battery energy storage to provide flexibility to the grid in the coming years. However, the recent low buildout rates highlight the need for the ESO to understand and tackle, where possible, the issues leading to this.
New storage technologies will be developed after 2029 in all Future Energy Scenarios pathways
All three net zero pathways feature rapid battery energy storage buildout until 2029, which then reduces beyond 2030. Battery capacity will reach 35 GW in 2050 in the Holistic Transition pathway, with just 8 GW built between 2030 and 2050.
This is because new storage technologies will be developed in all pathways after 2030. Pumped hydro, compressed air, and liquid air storage capacities will increase by up to 12 GW between 2029 and 2050.
All three pathways do not use battery energy storage as a long-duration storage solution.
Average battery duration is under two hours in all pathways
While installed battery power reaches 35 GW in the Holistic Transition pathway, battery energy capacity reaches just 65 GWh. In all pathways, the average energy capacity from batteries is 80% higher than installed power. This means the average duration of batteries is under two hours, with twice as many two-hour systems as one-hour systems.
By contrast, pumped hydro, liquid air, and compressed air storage will, on average, store energy for 13, 9, and 20 hours each by 2050. However, the average installed power of these three storage technologies will be 4.5 GW in 2050. This means batteries will provide 70% of stored power and 25% of stored energy on average across the three pathways in 2050.
It’s not just batteries missing Future Energy Scenarios pathways
One of the key messages from the ESO is “the next two years are crucial”. The new approach involving narrow, credible pathways to net zero highlights the importance of being positioned to meet those pathways rather than playing catchup. The ESO’s five-year forecast for greenhouse gas emissions shows that Great Britain is currently off-course.
This highlights the short-term work needed industry-wide to put greenhouse gas emissions in line with the pathways set out by the ESO.