That is the view from a cross government body responsible for low carbon innovation, the Low Carbon Innovation Co-ordination Group (LCICG). The group has produced an assessment of the innovation that is needed to deliver energy storage and smart energy grids at lower cost.
The LCICG said the UK’s biggest opportunities were in electric vehicle integration; storage technologies including thermal-to-electric storage, lithium-based batteries, and redox flow batteries; and overcoming co-ordination challenges for integrated electric vehicles, demand response, smart distribution, and storage solutions
However, while UK firms are currently trying to develop some of those technologies, sometimes using bill payers’ money through programmes such as Ofgem’s low carbon networks fund, they are held back by market and coordination failures, said the LCICG.
It said smart distribution, electric vehicle integration, demand response, and home hub technologies are mutually reinforcing and dependent, making it difficult for individual players to push forward. On an intelligent distribution network, the report cited a lack of national rollout plan and coordination as a critical failure. DNOs would struggle to rollout smart grids on their own, and the levels of penetration of renewable generation, heat pumps and energy efficiency measures coming on stream over time are uncertain, said the LCICG.
Other policy failures cited were a lack of understanding of the value of energy storage and that the value of storage services could not be captured under the existing market arrangements. Neither does current regulation allow sufficiently dynamic tariffs to deliver smart benefits, said the report. Even if they did, it would be hard to co-ordinate nationally, said the LCICG. Larger-scale, coordinated trials of several technologies at once are needed, according to the report.