Battery storage: Finance and revenues challenging but businesses predict 3-7 year payback

May 26, 2017

Three quarters of companies considering battery storage projects predict payback periods of between three and seven years, according to early findings of a survey by The Energyst.

However, when it comes to securing funds, predictability of revenue is a concern for almost two thirds (62%) of those surveyed, while stability of policy worries almost half (48%).

Respondents include water companies, telcos, manufacturers, logistics companies, universities and local authorities. Of 54 survey responses so far, exactly half are looking at battery storage (24 companies considering projects, three have already invested).

A third (32%) of planned projects are sub-250kW, a third (36%) are 250kW-500kW while a quarter (24%) are 1MW+. Two planned projects are between 500kW and 1MW and two respondents did not specify project size.

Of those projects, roughly 20% are standalone, roughly 30% are collocated with renewables and roughly 50% are behind the meter.

Respondents plan to stack multiple revenue streams to monetise their batteries, with peak charge avoidance/load shifting and faster frequency response services the most common denominators (see table).

A third of those polled say planned investments have three to five year projected paybacks, while almost half (46%) believe their projects will payback in five to seven years.

Two thirds of respondents will finance the battery internally, but only three in ten said they had experienced no problems in securing funds.

These early responses are part of a broader demand-side response survey and market report. As such, a different picture may emerge as the survey sample increases.

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