UK government refuses to clarify energy storage de-rating despite ‘imminent’ decision

LinkedIn
Twitter
Reddit
Facebook
Email

The UK government’s Department of Business, Energy and Industrial Strategy (BEIS) has refused to provide any clarity over when a decision on the potential de-rating of energy storage assets within the capacity market (CM) will be made despite a senior policy advisor stating the judgement is “imminent”.

In July BEIS proposed significant changes to how their generation classes are de-rated within the CM, the mechanism by which generation assets are paid to ensure Britain’s electricity supplies are reliable, suggesting that the majority of storage assets could lose their current 96% de-rating status in place of a mechanism designed to reflect the discharge duration of assets in the instance of a stress event.

With the exception of a methodology update in September, no further notices have been issued. Since this time, storage developers have entered their projects into pre-qualification for the next CM auctions scheduled for January/February 2018, with no knowledge of whether their applications will be affected by the rule change.

Speaking at Tuesday’s Solar Trade Association (STA) Market Access and Systems Integration conference, senior advisor for smart energy at BEIS, Alexander Berland told our UK sister site Clean Energy News (CEN) the decision would soon be forthcoming.

This article requires Premium SubscriptionBasic (FREE) Subscription

Enjoy 12 months of exclusive analysis

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Annual digital subscription to the PV Tech Power journal
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

“A publication is imminent; we are expecting a decision on that to be very soon. We do want to give clarity as soon as we possibly can as important decisions on investment are relying on that,” Berland said.

He added that this information had come from the government’s security of supply team who govern the CM.

When asked to elaborate today on Berland’s comments, BEIS refused to clarify when this “imminent” publication would be issued, adding only that the department “will be publishing in due course”. The department would not be drawn on if this would be before the T-1 auction to be held 30 January or the T-4 auction on 6 February.

A number of developers have expressed concern that the rules may be implemented ahead of these dates, severely impacting the business case used to build their applications.

One developer that submitted at least two projects into CM pre-qualification told CEN in September that to do so would “lack common sense”, as it would see a number of projects likely pulled from the CM at a time when government has expressed its intention to promote energy storage.

Speaking at the STA event, Katherine Vinnicombe, energy storage investment manager for Foresight Group, called on BEIS to show its hand on de-rating as it would allow investment decisions to be properly considered for future projects.

Read Next

July 31, 2025
We look at which BESS suppliers have supplied which UK project owner-operators, with data from our Market Research colleagues.
July 24, 2025
Greater deployment of renewable energy and battery storage in Illinois would help mitigate soaring costs of capacity market auctions in PJM Interconnection territory.
Premium
July 24, 2025
Steady price falls the past few years have made lithium-ion BESS a real contender for long-duration energy storage (LDES), and that is now reflected in global project pipelines.
Premium
July 24, 2025
ESN Premium’s deep dive into Japan continues with a look at the complexities of an evolving market underpinned by strong drivers for energy storage.
July 23, 2025
Activity in the UK battery energy storage system (BESS) market continues to grow substantially year-on-year despite numerous headwinds, as detailed in this H1 recap from our Market Research colleagues.

Most Popular

Email Newsletter