Current batteries are too expensive for large scale use but new battery technology and technical advances in areas such as composite materials will result in energy storage systems able to replace some plants and avoid the need for new ones, as well as reduce demand for oil, according to the report by the World Energy Council.
The report argues the current focus on the cost of storage ignores the system value of stored energy. It calls for the value of storage to be recognised, taking into account the benefits as well as the costs.
World Economic Council secretary general Christoph Frei said: “Energy storage is a critical catalyst of the energy transition whose benefits are still undervalued.
“The costs have already come down, but will have to fall further for a much broader roll-out and use in household and e-mobility. The investment community has good reason to be excited about the innovation and business models that will emerge from new opportunities.”
The report makes five recommendations to policymakers to unlock the potential of energy storage including, “examine storage through holistic case studies”, “work with operators and regulators to accelerate the development of flexible markets” and “consider storage as a key component for grid expansion or extension”.
Frei added: “To take full advantage of the growing wind and solar electricity shares, policymakers must review electricity market design so to incentivise the build-up of storage capacity and ensure reliable and affordable electricity supply.”