Energy storage

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Jeremy Hunt has announced that new electricity generation will be exempted from the government’s windfall levy on the sector, while unveiling a wide-ranging package of energy infrastructure planning changes in his Autumn Statement. The statement, widely reckoned to be the last before the next general election, contains a series of announcements on reforming the planning system and speeding up electricity grid connection timetables.
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Experts on long duration energy storage (LDES) are split on the necessary target needed to deliver the UK's decarbonisation goal. While some experts have urged the government to set a long-term target of up to 100TWh, others have suggested that a smaller “no regrets” target should be set to “get the ball rolling” on LDES. However, government officials have refused to be pushed on the possible size of a target.
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The government must not slip back into the complacency that ultimately led to the failure of the latest Contracts for Difference (CfDs) auctions to attract any bids from offshore wind projects, an industry expert has warned. Earlier this week, the government announced hikes to the strike price caps for next year’s auctions but Adam Bell, director of policy at Stonehaven, said further changes are needed to prevent a repeat of the problems that emerged during allocation round five (AR5).
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Latest in Energy storage

The next four-year-ahead (T-4) Capacity Market auction is expected to clear at a record high price for the third year running after the margin between prequalifying capacity and the procurement target fell to its lowest level since the auctions began in 2014. Although the target has been raised slightly to 43GW, according to analysis by EnAppSys, 45.2GW of de-rated capacity has prequalified for the auction in February next year, leaving a margin of less than 2.2GW – or 5%.
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The Rough storage facility has released stored gas into the grid for the first time this winter, to meet rising demand during colder temperatures. Operated by Centrica, Rough is the UK’s largest gas storage facility. This year, Centrica has filled Rough with the equivalent of 18 LNG tankers, double the amount stored last winter.  
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Firms involved in the development of batteries are finding it hard to access government support, the recently-published UK Battery Strategy reveals. The strategy outlines the steps government is taking to “achieve a globally competitive battery supply chain by 2030, that supports economic prosperity and the net zero transition”.
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The government will manage a “triage” process for prioritising the connection of strategically important energy projects as part of its joint action plan with Ofgem for speeding up grid connections. Working with the regulator, the Department for Energy Security and Net Zero (DESNZ) will establish a Connections Delivery Board to oversee the implementation of the six-point plan, which aims to cut the average wait for a connection from 5 years to 6 months.  
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Lower clearing prices in frequency response auctions will mean battery operators increasingly look to wholesale markets to generate revenues, an industry figure has told Utility Week. Chris McLeod, head of trading at Habitat Energy, was responding to the results from the first frequency response auctions to be held using the Electricity System Operator’s new Enduring Auction Capability platform.
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Swedish private equity firm EQT has struck a deal to acquire Statera, a UK-based developer and operator of battery storage and flexible electricity-generation infrastructure. Currently owned by InfraRed Capital Partners, Statera is due to be transferred into the control of EQT by the end of the year.
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National Grid is bringing forward the connection dates for 10GW of batteries under a new approach that allows them to connect to the transmission network before non-essential grid upgrades are completed. The previous approach assumed batteries could charge during peak times and discharge when renewable output is high, exacerbating demand peaks and network constraints.
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Two major battery storage projects have been boosted by investment decisions this week. SSE Renewables has taken a final investment decision to proceed with the construction of its 320MW battery energy storage system (BESS) in Monk Fryston, Yorkshire. Meanwhile, the UK Infrastructure Bank has announced a £60 million loan to support Pacific Green in its development of a new 249MW electricity storage park in Kent.
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The Electricity System Operator (ESO) will today hold its first frequency response auction using its new Enduring Auction Capability platform. The platform will finally allow providers to bid for multiple products with the same capacity at the same time. Utility Week looks at how the auctions will work.
Analysis
Assets such as batteries and electrolysers that can soak up excess power should receive transmission credits to incentivise them to locate in areas of the country with surplus renewable output. An SSE commissioned report points out that this would mirror the arrangements for generators which already receive credits for locating in areas where electricity demand outstrips supply. This is one of a number of recommended options for reforming Transmission Network Use of System (TNUoS) charges and constraint management to help drive the decarbonisation of the electricity system.
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Octopus Energy’s Centre for Net Zero and the Energy Systems Catapult have called on the government to introduce a Smart Building Rating (SBR), designed to incentivise demand flexibility. The rating would work in a similar way to the current Energy Performance Certificate (EPC) process, with buildings scored on their flexibility capacity.  
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The Electricity System Operator (ESO) is confident that take-up of this winter’s Demand Flexibility Service (DFS) will be at least three times the size of last winter's scheme. Under a “fairly moderate” scenario, the ESO expects around 1GW of capacity to be made available through the DFS. In a more optimistic outlook, the ESO thinks up to 2GW could be made available. The projections are made within the ESO's Winter Outlook which also reveals an increase in the de-rated margin for the first time in four years.
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