In the evolving landscape of Spain's energy market, the surge in renewable energy deployment has sparked a new competition: the race for dominance in energy storage. With the anticipation of a forthcoming regulatory framework, slated for approval in 2024 or early 2025, companies are strategically aligning themselves to secure leadership positions in this burgeoning sector.
Luis Marquina de Soto, president of AEPIBAL (Business Association of Batteries and Energy Storage), outlined a McKinsey matrix in a recent webinar hosted by AleaSoft Energy Forecasting and AleaGreen on November 16. The matrix draws a correlation between a company's market control and the regulatory status of that market. As the regulatory landscape for energy storage in Spain begins to take shape, companies well-versed in this market have a unique opportunity to assert themselves as leaders, urging them to seize the moment and shape the market in their favor.
The revenue stacking outlook for battery storage, as presented by the president of AEPIBAL, suggests that in the initial stages, batteries will significantly impact the market by participating in ancillary services. While the market for these services is not expansive, the current price volatility presents substantial revenue potential. However, the entry of more competitors is expected to lead to a decline in revenues, given the market's limited size.
Technological innovation emerges as a pivotal factor in this context. Pioneering companies, particularly those developing advanced storage technologies like green hydrogen storage, or leveraging Artificial Intelligence for efficient energy management, stand to play a leading role in reshaping the sector.
The period of evolving regulation for energy storage also opens doors for companies less acquainted with the battery market. They can explore opportunities throughout the battery supply and value chain ecosystem.
Conversely, some companies are adopting a cautious approach, choosing to await clearer regulatory definitions. Those with extensive knowledge of the battery market may position themselves as adept developers, while others less familiar with the business may bide their time until regulatory clarity provides a strategic entry point.
The strategic importance of batteries and energy storage in the broader energy transition cannot be understated. Advocates emphasize the urgent need to implement the capacity mechanism to economically support battery deployment. Simultaneously, there is a call to prioritize the development of infrastructures for green hydrogen production and distribution.
Amidst the complexity of the energy transition, effective coordination among stakeholders is paramount. While renewable energy deployment progresses positively, a comprehensive focus on energy storage development and the stimulation of renewable energy demand are deemed crucial to sustaining investor interest and ensuring a sustainable future in the energy landscape.
