The Prospects for Battery Investment in Germany
Merger and acquisition (M&A) activity has been heating up in Germany but increased competition and high interest
PV Magazine International 1:20 pm on May 28, 2024
The rollout of large-scale battery storage systems (BESS) is still relatively small, with 1.5 GWh capacity as of March 2023 and expected to grow to 4.6 GWh by end of 2025. In contrast, smaller household BESS has seen significant growth over the past five years, totaling 10.8 GWh. The UK leads in BESS development with potential projects facing challenges regarding grid-connection permits and financial viability. Battery revenue from regulatory services is declining as operators shift towards arbitrage strategies.
- BESS growth:
- Large-scale BESS capacity is nascent, expected to reach 4.6 GWh by end of 2025.
- Household BESS has a significant installed base with 10.8 GWh as of March 2023.
- UK leadership:
- British developers are ahead in BESS development, but grid connection permits pose challenges.
- Expected large-scale BESS deployment may reach 15-30 GW by 2030, with financial viability concerns due to prolonged construction timelines.
- Market evolution:
- Revenue from regulatory services for BESS operators is decreasing as they pivot towards arbitrage strategies.
- Developers, construction, and procurement firms are increasingly selective, impacting turnkey project valuations.
- Future outlook:
- Solar market remains attractive with regulatory support despite previous excesses being addressed.
- BESS is expected to play a critical role in supporting grid capacity and solar plants, necessitating careful selection of projects by investors.
https://www.pv-magazine.com/2024/05/28/the-prospects-for-battery-investment-in-germany/