The rise of batteries: battery markets seems to follow a similar path, so I lined up four of them by quarters since batteries first passed 1% of peak load. The pattern is fairly consistent. A few quiet years hovering around 2 to 3%, and then the curve bends sharply upwards. California reached 33% of peak load within 22 quarters of crossing the 1% threshold. Australia got to 23% in 17 quarters, with a dramatic acceleration towards the end. Texas hit 17% in 16 quarters. Great Britain is also at 17%, but it took 28 quarters to get there. What California, Texas and Australia show is that once batteries become cheap enough and the market rewards flexibility, deployment compounds rather than growing linearly. In the leading markets batteries now cover a third of peak demand, which would have sounded implausible five years ago. Other markets will follow this curve. The open question is how quickly. More on global battery markets in my next Substack. Sign up here: https://lnkd.in/ey3jr8JK
There are three markets for batteries: ancillary services, peak lopping and solar soaking. The third is by far the largest, which is why sunny, summer-peaking grids will ultimately have the highest battery penetration
Great Britain taking 28 quarters to reach the same 17% Texas hit in 16 is telling. Same technology and pricing, yet regulatory design alone seems to nearly double deployment speed.
Bulgaria would sit well above the top of this chart. Using the same capacity-to-peak-load metric, Bulgaria’s officially reported 4.1 GW of battery storage is equivalent to roughly 55% of the country’s peak electricity demand, compared with about 33% for California in the chart. And this is no longer only nameplate capacity. On 15 July, Bulgarian batteries actually discharged at a record 2.84 GW - approximately three quarters of national electricity load at that moment. The two figures measure different things, but together they show both the extraordinary scale of Bulgaria’s storage buildout and its already-visible impact on system operations. https://www.capital.bg/en/reports/energy
Impressive developments, but let's be clear that this is only power, not energy. Even in leading market like California, the energy volumes are in single digits percent. Example from yesterday: battery peak power 28%, battery energy supplied: 5.4%
The GB lag isn't just connection queues, it's price signal design. Texas, Australia and California all have merchant markets with real-time price volatility sharp enough to make standalone battery arbitrage bankable early. GB batteries spent most of that 28-quarter window relying on balancing mechanism revenue rather than wholesale price spreads, which is a much thinner and less scalable business case. Fix the signal and the curve bends faster, not just the queue.
Jan Rosenow, the S-curve pattern is striking. The investment question behind it is, what revenue stack made the acceleration bankable in each market? Was California driven mainly by contracted capacity and ancillary revenues, Texas by scarcity exposure and rapid market entry, and Great Britain held back by a different revenue mix and grid access? Falling technology costs may start the curve. It bends when capital can underwrite a credible and diversified revenue stream.
The leading regions,are of course where solar irradiation / power is greatest. This is why Califonia & Aus are ahead and UK not Solar pv maximises over a relatively narrow period of the day - which is not the maximum demand time. Hence storage is essential
Cheap batteries alone are not enough, the market must reward flexibility. The UK's early slowdown was largely due to its relatively conservative and cumbersome ancillary services market entry mechanisms and capacity market design. This offers important insights for other markets that followed (including China's ongoing electricity spot market reforms): the speed of institutional opening directly determines the slope of the S-curve in the electricity market
This is quite misleading. Battery storage should be expressed in MW-hours, not just in nominal MW (or nominal MW as a percentage of peak MW load). Shorter backup times can indeed be used for short peak shaving and grid stability - and this is what you show, but no more. But the whole concept of using batteries as energy storage to compensate intermittent renewables for over 12 hours each night (and for 10+ days in winter) when the sun isn’t there, or for when the wind stops blowing, depends on MW-hours. And today’s batteries are commercially too expensive for this. BESS typically have only a one to two hour backup time (or less), not the ten+ days we would need for full intermittent independence. We need to separate the expensive stack (MW) from the less expensive storage (MWh). This would suggest flow or hydrogen batteries, salt heat storage or compressed gas storage, rather than having to multiply the expensive anodes and cathodes in the stack (which puts lithium ion or sodium batteries in parallel to increase backup time). Today’s “battery storage” remains fast action gas turbines that kick in when renewables drop. Indeed, gas is a fundamental component of today’s renewables revolution.