Understanding Energy Storage Duration

When we talk about energy storage duration, we’re referring to the time it takes to charge or discharge a unit at maximum power. Let’s break it down:

Battery Energy Storage Systems (BESS): Lithium-ion BESS typically have a duration of 1–4 hours. This means they can provide energy services at their maximum power capacity for that timeframe.

Pumped Hydro Storage: In contrast, technologies like pumped hydro can store energy for up to 10 hours. For example, the Dinorwig Power Station in North Wales boasts a massive storage capacity of 9.1 GWh compared to GB’s largest BESS at 200 MWh. That’s a difference of 45.5 times in magnitude!

The relationship between energy, power, and time is simple: Energy = Power x Time

This means longer durations correspond to larger energy storage capacities, but often at the cost of slower response times.

Different Technologies, Different Roles

Energy storage technologies vary widely in how they support the energy system. Their characteristics make them suitable for distinct services and markets, such as:

Short-Duration Storage (e.g., BESS): Fast response times make them ideal for ancillary services such as frequency regulation. However, their capacity for long-term services like capacity market is de-rated by their shorter duration.

Long-Duration Storage (e.g., Pumped Hydro): More suitable for long-term capacity market contracts due to their ability to store energy for extended periods; they attract higher de-rating factors. Limited ability to participate in dynamic ancillary services due to slower response times.

The Capacity Mechanism De-rating Factors in GB

Capacity markets form part of some energy markets globally where energy service operators procure long-term capacity contracts alongside energy to ensure demand is met during system stress events. Check out last week's newsletter for more detail. The duration of energy storage directly impacts their value in capacity markets as shown below with the de-rating capacity mechanism factors in GB.

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Short-Duration Storage (<1 hour): 11.34% de-rating factor.
Long-Duration Storage (8+ hours): 94.37% de-rating factor.

This disparity reflects the complementary roles of these technologies. For instance, short-duration storage excels in fast-response scenarios but isn’t as well-suited to long-term capacity obligations. Conversely, long-duration storage dominates capacity mechanisms but struggles with rapid-response ancillary services.

Different battery technologies cater to different markets. Understanding these nuances helps in strategically deploying energy storage for maximum value.

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