Ireland is targeted to see significant growth in renewables in the next decades working towards a net zero energy system. Most of the added capacity will come from intermittent sources such as wind and solar making development of Long Duration Energy Storage (LDES) pivotal to enable a secure and stable net zero grid. Our Sustainable Futures team explore how this can be done.
In addition to enabling renewable penetration and reducing the need for fossil fuel powered backup generation, LDES will also improve the performance and cost-efficiency of the grid, which is a main concern in any energy transition. LDES is on the rise, and recent years have seen it receive increased intention for instance in Climate Action Plan 2023, by ESB Networks, and most recently by EirGrid and SONI who now call for industry feedback to shape the future of LDES on the transmission network.
Enabling high renewables generation
Energy storage is the counterweight to intermittent renewable generation capacity, such as wind and solar power, and enables balancing of the energy system by matching supply and demand. With a target of 80% renewable electricity from intermittent sources on our grid by 2030, Ireland will require a significant amount of energy storage in the years to come.
Current options are sparse: The c. 700 MW of batteries connected to the grid of short duration and mainly provide system services rather than storage service, and the only longer duration storage is the Turlough Hill Pumped-Storage Power Station with 6 hours of 292 MW storage.
In the absence of renewable storage options, gas-turbines currently supply most of Ireland’s dispatchable power generation capacity, though the lack of gas storage facilities on the island is a considerable concern with regards to energy security.
Long duration energy storage (LDES) will be crucial to our future energy systems and enable increasingly high levels of renewable penetration. As opposed to short duration storage that mainly provides system services, LDES allows for storing and dispatching energy on-demand rather than letting surplus renewable energy go to waste and using fossil fuel generation to cover deficits in times of low renewable generation.
There is no set definition yet for what duration qualifies a technology as “long-duration”, though EirGrid’s most recent definition is 8+ hours.
LDES can be supplied by various technologies, some of which are outlined below:
Duration and capacity of major energy storage technologies (1)
A key benefit of LDES is ability to reduce dispatch down of renewable power, which is a major hurdle for further deployment of renewable generation essentially involving “spillage” of renewable electricity. As such, dispatch down is the practice of deliberately reducing renewable generation.
This is usually due to supply outweighing demand or constraints originating from network or system considerations, such as limits on how much electricity power lines can carry or operational requirements to run thermal power stations. In 2022, c. 1.3 TWh[2] renewable electricity (8.5% of total generation) was dispatched down on the island of Ireland – a trend that is expected to continue growing with increasing renewable penetration.
LDES mitigates dispatch down by storing surplus energy until it is needed, or constraints are removed be it on an intra-day, inter-day, or even seasonal scale. In this way, LDES reduces reliance on fossil fuelled dispatchable generation, which today is required to cover demand in times of low renewable generation. Storage of surplus energy also provides the TSO with increased operational flexibility, which lowers the amount of grid investment required.
The illustration below shows how LDES on the system mitigates both spillage of renewable energy and requirement of back-up fossil capacity as LDES is charged with renewable energy in the night and discharged during the day to make up for the temporal differences in supply and demand for electricity.
Illustration of supply and demand of electricity along with LDES operation over a 24-hour period
Scoping out the path to LDES
LDES has received increased attention over the last few years due to its pivotal role in our energy transition and was identified as such in Climate Action Plan 2023 (CAP23). ESB Networks, Ireland’s Distribution System Operator (DSO) covered the topic in their June 2023 publication Scenarios for 15-20% Flexible System Demand [3] highlighting the importance of medium- and long-duration storage for system flexibility and stating that their work on designing market-based, location-specific multiyear contracts for medium-duration energy storage (4+ hours) has already commenced.
Furthermore, EirGrid’s Shaping Our Electricity Future (SOEF v1.1) Roadmap from July 2023 quantifies Ireland’s requirement for LDES at an additional 2,400 MW and Northern Ireland’s by 350 MW in 2030.
The benefits of LDES are not just avoided carbon emission and increased renewable penetration: In their Game Changer report from 2022[4], Energy Storage Ireland and Baringa found that energy storage can deliver a net saving of €85m per year to end customers in addition to reducing day-ahead emissions by 50% and curtailment by 100%.
The most recent development in Ireland’s LDES space, EirGrid and SONI, the island of Ireland’s two Transmission System Operators (TSOs) published A Call for Evidence on the Market Procurement Options for Long Duration Energy Storage (LDES) on 27 October[5].
The TSOs recognise the need to investigate several matters related to LDES such as the needs case, investment barriers, services provided by storage, and revenue stream options. Through this call for evidence, the TSOs look to obtain views from key stakeholders on these matters across a list of 31 key questions before 24 November 2023.
In the Call for Evidence, EirGrid and SONI highlight some of the benefits LDES can present to Ireland. The most notable ones are:
| Result (All Ireland) | No New Incremental Storage | With New Incremental Storage |
|---|---|---|
| RES-E | circa c.84% | circa c.89% |
| Carbon Emissions | 4.9 MtCO2e | 3.35 MtCO2e |
| Dispatch Down levels | circa c.35% | circa c.27% |
| All Ireland Gen Cost | €1.126 billion | €0.754 billion |
The TSOs aim to complete the Procurement Process and Award contracts for LDES in the second half of 2024 with successful applicants to be connected by the start of 2029. The TSOs are considering recommending one or more of the four options for procurement mechanisms outlined in the paper, which are:
- Status Quo – a do nothing approach
- Amended current mechanisms – minor refinements to improve revenue stacking
- A standalone auction for energy storage
- Fixed Term System Services Contract with Central Control
Our view
KPMG welcomes the Call for Evidence published by EirGrid and SONI and commends the TSOs’ work both in engaging stakeholders such as DECC[6], DfE[7] in Northern Ireland, and peer TSOs that are more advanced in LDES in the initial phase as well as seeking broader feedback through the Call for Evidence.
International learning, industry-wide collaboration, and early engagement increase the chances of success for future market structures and reduces the likelihood that major changes will be required post-implementation at higher costs, based on KPMGs wide experience in working with the energy industry in Ireland as well as internationally.
Responses to the Call for Evidence will certainly contribute to shaping Ireland’s approach to and procurement design of long duration energy storage as the TSOs aim to move towards the next stage in the process.
Highlighting the early stage is the fact that the minimum duration of LDES is not yet decided: The Call for Evidence lists it as 8+ hours, while Shaping Our Electricity Future v1.1 also included 4-8 hours in the definition. The Call for Evidence also asks for industry feedback on the definition with Question 8 specifically asking consultees “Do you agree with our definition of Long Duration Energy Storage, storage with a minimum duration of 8 hours?”
As quantified in the Call for Evidence, it is likely that LDES will play a significant role in Ireland’s energy system by the end of the decade. This Call for Evidence offers stakeholders with interest in energy storage a unique opportunity to influence the framework that will influence Ireland's path for LDES in years to come.
KPMG encourages such stakeholders to submit their answers to EirGrid and SONI by the consultation deadline.
Get in touch
If you are interested in learning more about long duration energy storage, or would like a discussion around how to get more involved in LDES in Ireland, please reach out to our team below.
We'd be delighted to hear from you.
Contact our team
Read more in Sustainable Futures
Footnotes
- Potential of P2H2 technologies to provide system services (entsoe.eu) (PDF, 4.2MB)
- EirGrid - Annual Renewable Energy Constraint and Curtailment Report 2022
- ESB Networks – Scenarios for 15-20% Flexible System Demand – National Network, Local Connections Programme (divio-media.com) (PDF, 3.3MB)
- GameChanger-ESI-Report-May2022-Web-1.pdf (energystorageireland.com) (PDF, 3.5MB)
- LDES-Call-for-Evidence-SONI.pdf (PDF, 612KB)
- Department for the Environment, Climate, and Communications
- Department for the Economy