Centrica is to manage a 3MW battery storage system for Gateshead City Council.
The system has been installed alongside CHP units at the council’s District Energy Centre.
Aggregator Flexitricity recently signed a 15-year deal to manage that CHP output within balancing markets, which it said would earn the council around £1m over the contract.
The council-owned Gateshead Energy Company will now look to generate significant income from current and emerging markets via the speed of response afforded by batteries.
Announcing the deal, Centrica said it will operate the system to provide various grid balancing services, generating revenue for the council, on a ten-year contract. The company added that the system will also, eventually, provide local grid balancing services, which is where many analysts believe considerable future value lies for battery storage investors.
Cllr John McElroy, Gateshead Council’s cabinet member for environment and Transport, said: “This battery installation completes the wider District Energy Scheme, which will provide low cost heat and power to homes, organisations and businesses in central Gateshead.
“It’s a bold, imaginative scheme that means we can also store and release power when we choose, as well as supporting the National Grid, which helps raise more income to support Council services.”
Centrica believes the UK is approaching a battery storage “boom”, a view that appears to be borne out by recent Energyst research.
More than half of firms surveyed for the recent 2017 DSR Report said they were considering investment in battery storage, two thirds of them believing their projects would payback in under seven years.
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