The skip rates for batteries in the UK is decreasing but still high 90%=>75%
because it’s easier for an essentially manual process to fire up a gas plant than manage several short duration batteries even though they are cheaper.
The (N)ESO software upgrade to resolve this is looking more like 2026 to resolve this problem.
I think there is deep long term value here. In the shorter term we can expect the growth in generation to outpace the delivery of transmission leading to greater curtailment expense and hence further driver for storage. ⚡️🔋
Thanks Jon, I updated the typo and did a bit of digging around Resource Adequacy and California trading ranges. Disappointing to hear the (N)ESO upgrade is over a year out.
Dogfish is on track to be energised in Feb 2025. It will be 75MW. Full operation seems to be three months after energisation so that will be May 2025. Average ERCOT rates from May 2025 to May 2026 will be about £125K/MW/year so that makes Dogfish revenue in its first year of full operation £9.4M.
Change this sentence: "GSF forecasts declining prices in the USA (ERCOT) and Northern Ireland (CAISO) due to special schemes coming to an end in 2026" to something like: "GSF forecasts declining prices in Texas (ERCOT) and Northern Ireland (NI) due to special schemes coming to an end in 2026".
GRID chairman and inv mgr are perennial moaners about the ESO but all BESS assets are on even playing field. My take is GRID have most of their assets outside balancing mechanism (BM) which is a useful source of income for HEIT/GSF for reasons never explained. You also didn't mention that GRID have effectively sub let 50% of their portfolio to Octopus for 2yrs in exchange for an annual fee. Could work in their favour but basically was a clear indication to me they didn't believe their own forecasts and covered themselves before resetting them.
On the ESO it has a clear upgrade path to ensure BESS can be used more in the BM and since start of year BESS have taken more of the pie but as I say GRID don't have much of their portfolio in the BM anyhow.
Will give GRID credit that increasing the capacity at existing sites is a smart move doesn't need any work on the grid connection and gives them access to longer range duration but not clear if these are the sites they've handed over to Octopus.
Finally lets be real no one really knows where energy prices are going and its all finger in the air stuff and currently its largely driven by the price of gas as that is primary driver of daily electricity prices through most of the year. In higher summer when the sun is out solar thrives and floods the system driving prices negative for a few hours but for the majority of the year its gas that sets the price because its the only source of dispatchable generation and its the last plant on each half hour that sets the overall price. So if you look at global gas its well supplied with significant LNG additions coming on line over next 2yrs combined with renewables now displacing a proportion of gas we have the possibility of reasonable steady state energy balance which should keep prices in a tight range. So I would say 45k/MWh is reasonable rate to use for annualised income.
Hi Stock, it's a very interesting area where SolidPower, Illika, Invinity are also investment ideas. But also Ceres Power and Hysata whilst electrolysers are not BESS they are energy storage (so should be thought of as competing technologies). Then the next consideration is whether to back the producers of BESS or the users of BESS (e.g. Gore Street GSF), or even the metals that go into the energy storage (e.g. Vanadium, Lithium)
It could be the basis for a future "Battery Store - profer the Frauenhofer offer" article!
👍CAISO = California https://www.caiso.com/
The skip rates for batteries in the UK is decreasing but still high 90%=>75%
because it’s easier for an essentially manual process to fire up a gas plant than manage several short duration batteries even though they are cheaper.
The (N)ESO software upgrade to resolve this is looking more like 2026 to resolve this problem.
I think there is deep long term value here. In the shorter term we can expect the growth in generation to outpace the delivery of transmission leading to greater curtailment expense and hence further driver for storage. ⚡️🔋
Thanks Jon, I updated the typo and did a bit of digging around Resource Adequacy and California trading ranges. Disappointing to hear the (N)ESO upgrade is over a year out.
Dogfish is on track to be energised in Feb 2025. It will be 75MW. Full operation seems to be three months after energisation so that will be May 2025. Average ERCOT rates from May 2025 to May 2026 will be about £125K/MW/year so that makes Dogfish revenue in its first year of full operation £9.4M.
Change this sentence: "GSF forecasts declining prices in the USA (ERCOT) and Northern Ireland (CAISO) due to special schemes coming to an end in 2026" to something like: "GSF forecasts declining prices in Texas (ERCOT) and Northern Ireland (NI) due to special schemes coming to an end in 2026".
GRID chairman and inv mgr are perennial moaners about the ESO but all BESS assets are on even playing field. My take is GRID have most of their assets outside balancing mechanism (BM) which is a useful source of income for HEIT/GSF for reasons never explained. You also didn't mention that GRID have effectively sub let 50% of their portfolio to Octopus for 2yrs in exchange for an annual fee. Could work in their favour but basically was a clear indication to me they didn't believe their own forecasts and covered themselves before resetting them.
On the ESO it has a clear upgrade path to ensure BESS can be used more in the BM and since start of year BESS have taken more of the pie but as I say GRID don't have much of their portfolio in the BM anyhow.
Will give GRID credit that increasing the capacity at existing sites is a smart move doesn't need any work on the grid connection and gives them access to longer range duration but not clear if these are the sites they've handed over to Octopus.
Finally lets be real no one really knows where energy prices are going and its all finger in the air stuff and currently its largely driven by the price of gas as that is primary driver of daily electricity prices through most of the year. In higher summer when the sun is out solar thrives and floods the system driving prices negative for a few hours but for the majority of the year its gas that sets the price because its the only source of dispatchable generation and its the last plant on each half hour that sets the overall price. So if you look at global gas its well supplied with significant LNG additions coming on line over next 2yrs combined with renewables now displacing a proportion of gas we have the possibility of reasonable steady state energy balance which should keep prices in a tight range. So I would say 45k/MWh is reasonable rate to use for annualised income.
Do you know anyone who can evaluate the potential of Altech Batteries ($ATC) / Frauenhofer battery/ grid storage solution? (Not on the market yet)
Do you mean these listed on the ASX?
https://www.altechgroup.com/investors/dashboard/
Yes
Hi Stock, it's a very interesting area where SolidPower, Illika, Invinity are also investment ideas. But also Ceres Power and Hysata whilst electrolysers are not BESS they are energy storage (so should be thought of as competing technologies). Then the next consideration is whether to back the producers of BESS or the users of BESS (e.g. Gore Street GSF), or even the metals that go into the energy storage (e.g. Vanadium, Lithium)
It could be the basis for a future "Battery Store - profer the Frauenhofer offer" article!
OB