Storage must work for its owners, too

Ask two different questions

How much can the store deliver at once? How much energy can it deliver before it needs to recharge? Power answers the first question. Energy answers the second.

A planning model must state both. It must also state losses, operating limits and the cost of replacement. Our economics model separates these inputs.

A revenue test with clear limits

We tested a battery against historical Swiss day-ahead electricity prices. Day-ahead trading is buying and selling electricity for delivery on the following day. The model knows all future prices within the test year. That makes this a benchmark, not a record of earnings.

The ownership calculation spreads the purchase cost over an assumed working life. It includes financing and an allowance for operation and battery upkeep.

Under these assumptions, the modelled energy-trading margin is below the illustrative annual ownership cost. Other services and contracts are outside this comparison. It cannot establish that all batteries are unprofitable. The cost assumption is not a current supplier offer.

Hydro is not a free storage service

Our planning rule: hydro owners must have a viable business case for the service a national plan expects them to provide. We should state water, environmental and commercial constraints before assuming that a reservoir can shift production to any desired hour.

Compare proposed hydro expansion with batteries for the same service and delivery date. Include capital cost, operating cost, losses and income foregone from alternative uses. Do not compare the purchase price of one option with only the operating cost of another.

What the evidence does not establish

National battery availability and procurement costs require verified supplier offers and delivery commitments. A comparison with hydro projects also needs location-specific engineering, connection terms and revenue assumptions.