Energy security is one of the defining challenges of this era. The 2022–2023 energy crisis after Russia’s invasion of Ukraine highlighted the need for the EU to reduce its vulnerability to geopolitical shocks and volatile global markets. However, the bloc still imports 58% of its energy. The EU set a target of sourcing over 42% of its energy from renewables by 2030, to address part of this challenge.

Installing wind turbines and solar panels alone will not deliver energy independence. The intermittency of these resources demands additional system flexibility and significant grid enhancements. To this point, the European Parliament flagged flexibility shortfalls as a near-term reliability risk, and projected system needs of 30% by 2050, a near three-fold increase from the amount of flexibility in 2021.

Energy Storage Europe (formerly the Energy Storage Europe Association) completed an extensive review study that showed the EU needs an energy storage capacity of about 200 GW by 2030, inclusive of significant amounts of long duration storage, to achieve its renewable energy goals.

The EU must implement an effective combination of a mix of storage durations, including short-duration (two to eight hour), long-duration (eight to 24 hour) and ultra-long-duration storage (24 hours plus). Deploying a blend of resources with different durations helps the EU avoid filling flexibility gaps with new gas infrastructure, which would make the region more vulnerable to fuel supply disruption and price volatility. Research shows that a portfolio approach with different durations will also be significantly more cost effective than relying on short-duration technologies alone.

Today, EU policy mostly supports short-duration technologies, primarily lithium-ion batteries, with most investment still concentrated in these assets. There is no such mechanism incentivising and providing long-term price signals for long-duration solutions, which makes investing in and developing these projects difficult and potentially impossible.

Hydrostor, in a new white paper, suggests that the EU develops policy to incentivise storage solutions with longer-durations to meet these needs. This will help attract necessary investment in resources that can provide these services at the lowest cost.

The EU must implement an effective combination of a mix of storage durations, including short-duration (two to eight hour), long-duration (eight to 24 hour) and ultra-long-duration storage (24 hours plus).

An energy storage mix 
By deploying a combination of energy storage solutions, the EU could bridge flexibility gaps in a way that delivers energy independence and avoids sinking billions into stranded assets.

For example, a single 500 MW advanced compressed air energy storage (A-CAES) project that provides energy storage for more than eight hours can power nearly 1.2 million European households with home-grown clean energy, reducing energy market price volatility. At the macro level, energy storage could also save the EU €103bn in grid operating and curtailment costs by 2040.

Additionally, energy storage supports grid resilience against extreme weather and can help lower electricity prices by cutting the link between low-cost renewable energy and expensive traditional fuel-generated power. Having done so, Finland now enjoys some of the lowest electricity prices in the EU, with wind, hydropower and solar comprising 42% of the country’s energy generation.

To enable the deployment of these technologies, the EU must first undertake system modelling that factors in the costs and asset lifetimes of all types of energy storage. In Ireland, for example, this modelling found that the strategic deployment of long-duration and ultra-long solutions could deliver up to €85mn/y in net savings to Irish households by 2030.

The EU must also set procurement targets for each type of energy storage solution, with transparent, multi-year schedules to achieve them. Italy’s MACSE scheme provides an illustrative example for others to follow. Targeting 50 GWh of energy storage by 2030, it is starting with 2.5 GW of four-hour batteries in its first round and intends to include longer duration technologies in subsequent rounds.

A flexible grid needs flexible thinking
Energy storage does not come in one shape or size, and each solution provides different benefits. Large-scale long-duration projects deliver hundreds of jobs and can play a key role in driving long-term economic growth. A 500 MW A-CAES project, for example, employs more than 6,500 people over the course of construction and 40 full-time employees throughout the 50+ years of operation. Over their lifetime, these types of projects can abate over 45mn tonnes of CO₂ emissions.

The EU needs to implement policies that ensure revenue certainty for long duration projects. These could include procurement through cap-and-floor mechanisms, as introduced in the UK. These types of policies and procurements will result in development and deployment of long duration storage, which is crucial to achieving energy independence and decarbonisation for Europe.

Read more about these insights in Hydrostor’s white paper, From Ambition to Action: Embedding Long Duration Storage in European Energy Strategy.

The views and opinions expressed in this article are strictly those of the author only and are not necessarily given or endorsed by or on behalf of the Energy Institute.

• Further reading: ‘Energy storage – long and short-term’. Lithium-ion batteries sometimes seem to have taken over the world, as they are nearly universal in consumer electronic devices. Discover more about their benefits, the most obvious one of which is that they retain charge for a substantial length of time.
• Find out why pumped hydro is back in vogue for energy storage.