2024 was a pivotal year for battery energy storage in Great Britain. Batteries began the year with their lowest revenues on record and ended with their highest revenues in two years.
It followed 2023, a year where buildout reached record highs and frequency response services saturated, leading to an evolved revenue stack. In 2024, batteries were utilized more than ever in high-energy services such as wholesale trading and the Balancing Mechanism.
New services, systems, and operational strategies emerged. New players entered the market, and batteries continued to grow in capacity.
This 2024 battery energy storage year in review summarises the ten main events, trends, and takeaways from the year.
1. Total battery capacity grew to 4.7 GW by the end of 2024
1 GW of battery capacity began commercial operations in 2024, taking the total rated power of batteries in Great Britain to 4.7 GW. The total energy capacity of batteries in Great Britain also grew to 6.5 GWh. Altogether this means the average duration of batteries in Great Britain was 1.39 hours by the end of 2024.
67% of the rated power from new batteries online in 2024 had a two-hour duration, compared to 46% in 2023. In addition to this, Gresham House augmented several of its existing batteries to increase their energy capacity by 190 MWh, too - Arbroath, Enderby, West Didsbury, and Penwortham.
In general, the buildout in 2024 was lower than expected. 2023 was a record-breaking year with 1.6 GW of new capacity becoming commercially operational. 2.4 GW of batteries was projected to come online in 2024. However, following the low buildout in Q1 2024, the projection reduced to 4.6 GW.
The augmentation of existing units and the buildout of batteries with higher rated powers and energy capacities are likely to increase over the next few years as the cost of building a battery has reduced and is projected to continue to fall.
2. Twelve new battery owners came to market in 2024
Twelve new owners saw their first batteries begin commercial operations in 2024 contributing a total of 380 MW. SSE, SUSI/Eelpower, NextEnergy/Eelpower, and Econergy saw the highest increases at 50 MW each.
Meanwhile, Ecotricity and Schroders Greencoat brought two new co-located sites online in 2024 - 10 MW Alveston, co-located with wind generation, and 25 MW Tiln, co-located with solar generation. Shroders Greencoat acquired Tiln from Lightsoruce bp in August.
Some other existing owners also saw a significant increase in their total operational capacity.
TagEnergy saw the largest site of 2024 come online with the 100 MW / 200 MWh Lakeside battery. At 200 MWh, Lakeside is the largest site in Great Britain in terms of energy capacity. The 50 MW / 100 MWh Roaring Hill battery takes TagEnergy’s total new capacity as a single owner in 2024 to 150 MW.
Gresham House brought three new sites online - West Disbury, York and Penwortham - totaling 150 MW. It also increased the rated power of its Nevendon site by 5 MW, meaning that the fund saw the largest total increase in capacity at 155 MW.
3. Eight new battery operators began optimizing batteries
Danske Commodities, SSE, Goldman Sachs and Ecotricity all began operating batteries that came online in the year. On top of this four other optimizers began operating grid-scale batteries for the first time with previously existing batteries. - Octopus, Gore Street, Equinicity and Field.
Octopus began its unique tolling agreement with Gresham House. Gresham House also turned over the optimization of its Rufford site to first-time operator Equinicity. Owners, Field and Gore Street Capital entered the optimizer space by switching some of their existing batteries to in-house operations.
4. The Quick Reserve and Balancing Reserve services were launched
The National Energy System Operator, NESO, introduced two new reserve services in 2024. These services allow NESO to procure firm reserve for the Balancing Mechanism in advance.
The first of the two services to be launched was Balancing Reserve in March. On average, 403 MW of capacity was reserved for the positive service and 84 MW for the negative service. Gas peakers and batteries made up the bulk of the volume at 57% and 27% respectively.
The second service to be launched was Quick Reserve which went live on 3rd December. This service is similar to Balancing Reserve but requires units to ramp within one minute compared to five minutes for Balancing Reserve. This makes it ideal for batteries - which have been the only technology to provide the service so far. On average, 344 MW of Positive Reserve was procured through this service in each settlement period, and 175 MW of Negative Reserve.
Positive Balancing Reserve prices have averaged £3.63/MW/h, while Negative Balancing Reserve prices averaged £0.98/MW/h. The negative service has a low price cap of £1.55/MW/h.
Positive Quick Reserve prices have averaged £8.85/MW/h, while Negative Balancing Reserve prices averaged £5.06/MW/h.
Batteries made £2.5k/MW/year through reserve services in 2024, which was 4% of total battery revenues.
5. Battery revenues more than doubled from their all-time low by the end of the year
At the start of the year revenues had reached an all-time low. The ME BESS GB was £36.6k/MW/year on average across January and February. The ME BESS GB (1H) was £32.6k/MW/year, lower than the previous minimum of £33.9k/MW/year seen in 2020. The low revenues were the result of a winter with low price volatility, meaning low wholesale spreads for batteries to trade on.
NESO’s introduction of the Enduring Auction Capability (EAC) for procurement of frequency response services and later, reserve services included the implementation of negative prices. For the first time, batteries could pay NESO for imported energy. as the high service went negative.