Hybridisation of batteries and renewable energy not only improves the technical efficiency of projects but also provides significant advantages in the PPA field, both for producers and buyers. With this growing trend, the future of energy storage and management is shaping up to be one of the most strategic pillars for decarbonising the European energy system.
The 47th edition of AleaSoft Energy Forecasting’s monthly webinar series took place on September 19. On this occasion, in addition to the usual analysis of the evolution of energy markets in Europe in recent weeks and the prospects for the coming months, Xavier Cugat, Product Director at Pylontech, and Francisco Valverde, independent professional in the development of renewable energy projects, participated in the analysis table of the webinar in Spanish. During the analysis table, interesting aspects of energy storage, particularly batteries, were discussed.
Energy storage in Energy and Climate Plans
All energy and climate plans of European countries mention energy storage, and batteries in particular, as a key element for decarbonisation and renewable energy growth. All European plans agree that energy storage will be essential, but not all present concrete targets for installed capacity by 2030. The LCOE (Levelized Cost of Electricity) of storage technologies, which has halved in the last year, will play an essential role in the total cost of renewable energy projects, determining their competitiveness against conventional energy sources.
In this respect, Spain and Portugal are two exceptions, as both countries not only mention energy storage but also include quantified targets. In both territories, pumped hydro already plays a relevant role, and its capacity is expected to continue increasing in the coming years.
In the definitive publication of the update of the Spanish National Energy and Climate Plan (NECP), the storage capacity for 2030 amounts to 9.5 GW of pumped hydro and 9.4 GW of batteries, to which 3.6 GW of storage capacity from solar thermal power plants must be added. The draft update of the Portuguese National Energy and Climate Plan (NECP) sets a target of 1 GW of batteries installed by 2030.
Ambitious and achievable targets
The focus on batteries is particularly notable. In the case of Spain, a target of more than 9 GW of battery storage capacity is projected for 2030. However, current data reflect a much larger interest in battery projects. More than 10 GW have already received access and connection permits from Red Eléctrica, while another 8 GW are in the pipeline, totalling almost 19 GW. Although it is unlikely that all these projects will be consolidated, the figure suggests that the target of 9.4 GW by 2030 is comfortably achievable.
With increasing grid access demand for battery projects, the outlook for 2030 is optimistic. Energy storage is emerging as a key pillar for an energy transition towards renewable energy sources and decarbonisation. The prospects are positive and the sector appears ready to face the challenges ahead.
Hybridisation of renewable energy and battery energy storage
The webinar also highlighted the importance of hybridisation of batteries with renewable energy production, a trend that is gaining ground in new renewable energy projects. The logic behind this approach is clear: store energy directly at the site where it is generated, avoiding the need to inject it into the grid and then extract it elsewhere, which would reduce both losses and overload on the electricity infrastructure.
Hybridisation not only optimises the use of renewable energy but also offers more technically and economically efficient solutions. According to AleaSoft Energy Forecasting, most of the battery projects carried out in 2024 by AleaStorage have been hybrid plant projects, combining technologies such as solar photovoltaic energy and wind energy with battery storage, and even some installations that allow charging from both the plant and the grid to optimise the use of storage capacity to the maximum.
Impact of hybridisation on PPA
The hybridisation of a battery energy storage system with a renewable energy plant can have a significant impact on the closing of a PPA (Power Purchase Agreement). Currently, most PPA are signed under the pay?as?produced model, which shifts most of the supply risk to the offtaker. However, by integrating batteries into renewable energy plants, greater stability for the supply is achieved, allowing more fixed energy profiles to be provided, closer to a baseload profile, which is preferred by offtakers.
The integration of storage allows energy producers to improve the terms of PPA and ultimately obtain better prices. Although hybridisation has higher upfront cost and CAPEX, this is offset by increased profits and a higher IRR (internal rate of return), making it an attractive option for the sector.
AleaStorage also provides forecasting services that quantify the increase in benefits of integrating storage into a renewable energy plant project. AleaHub, on the other hand, has a PPA marketplace, where both offtakers and renewable energy projects can find the ideal counterpart to close deals under the most favourable conditions. This space connects both parties, fostering more efficient transactions in a constantly growing market.
AleaSoft Energy Forecasting’s analysis on the prospects for energy markets in Europe and the financing of renewable energy projects
The next webinar of the monthly webinar series organised by AleaSoft Energy Forecasting, which will be the 48th, will take place on 17 October. For the fifth consecutive year, guest speakers from Deloitte will participate in this webinar. The analysed topics will be the evolution and prospects of European energy markets for winter 2024?2025, the financing of renewable energy projects and the importance of forecasting in audits and portfolio valuation.
