Analysis from Modo Energy has revealed that renewable energy projects awarded contracts under the Contracts for Difference (CfD) Allocation Round 6 (AR6) could facilitate 1.4GW of co-located battery energy storage systems (BESS).
While BESS projects themselves cannot directly participate in the CfD auction, projects awarded contracts are able to co-locate with a battery. Following changes to the rules following Allocation Round 4, BESS co-location is now a far easier prospect for generators, and AR6 saw record high levels of awards for solar projects.
Modo Energy analysis suggests that 5GW of the 9.6GW of renewable energy capacity awarded contracts in AR6 could be suitable for, or has already revealed plans for, co-located battery storage. As a result, as much as 1.4GW of BESS capacity could be created as part of new renewable projects resulting from the AR6.
Using an average ratio of 60MW of BESS capacity for every 100MW of solar generation capacity, Modo Energy has calculated that 1GW of this potential BESS capacity could come from solar projects alone.
Of these, Modo Energy theorizes that EDF Renewables’ 500MW Longfield Solar Energy Farm could see the largest battery to co-locate with renewables from this allocation round. While the site does have planning permission for co-located BESS, it does not have a stated capacity; based on average ratios for known co-located BESS capacities from AR6, Modo Energy predicts that a BESS at Longfield would have a capacity of 300MW, but if EDF Renewables chooses to match its solar generation and storage capacities for this project, a Longfield BESS could be as large as 500MW.
The potential for co-located BESS from AR6 significantly bests that of AR5, an allocation round that saw significantly less renewable capacity awarded contracts overall. Modo Energy estimates that 1.1GW of the 3.6GW of projects winning contracts in AR5 could see co-located BESS, which is expected to total 750MW of storage capacity.
The total battery capacity that is expected to be co-located with CfD backed projects from AR4 to AR6 could be as high as 3.1GW. While none of the batteries planned for co-location with renewables from AR4 have begun commercial operations, co-located batteries are not included as part of the CfD agreement and therefore are not required to come online by the generator’s agreed commissioning date.
According to Modo Energy, the number of BESS projects co-located with CfD renewable energy projects could reach as much as 11 times the number of currently existing co-located BESS projects. At present, eight co-located battery sites over 7MW are commercially operational in Britain, and 77 sites from allocation rounds AR4 – AR6 could be co-located with energy storage. If these 77 sites energise their BESS alongside their target commissioning date, these batteries could all be online as soon as 2028.
