- Battery storage requires subsidies of about €31 per kW per year versus nearly €100 per kW for gas.
- Up to €270 million in system savings projected between 2031 and 2050.
- Replacing 2 GW of gas with long duration storage could save €166 million annually.
A new study by LCP Delta, commissioned by Field Energy, finds that long duration energy storage can deliver security of supply at a significantly lower cost than new gas fired generation.
The analysis focusses on the evolving capacity market in Germany, where the European Commission has approved plans to procure 12 GW of new climate neutral capacity. The findings highlight the growing role of long duration energy storage as Europe accelerates its transition away from fossil fuel based power systems.
From an economic perspective, the study shows a clear advantage for battery storage. Average subsidy requirements are estimated at €31 per kW per year, compared to close to €100 per kW for gas fired plants. Over the long term, a 10 hour storage system could deliver net system savings of about €270 million between 2031 and 2050.
The report also identifies strong benefits for consumers. Replacing 2 GW of gas capacity with 18 hour storage systems could reduce annual costs by as much as €166 million, while maintaining the same level of supply security.
On the technical side, long duration storage demonstrates higher reliability. Battery systems achieve availability rates of about 98%, compared to around 94% for gas fired generation. Storage systems with durations exceeding 16 hours reach parity with gas plants when replacing 1 GW of capacity, while 20 hour systems can deliver the same level of security with less than 1 GW installed.
Unlike gas peaking plants that operate only during periods of high demand, long duration storage can run throughout the year. This enables higher utilisation rates and allows operators to access multiple revenue streams across energy, capacity and ancillary services markets.
The findings reinforce the case for long duration storage as a core pillar of future power systems, offering both economic and operational advantages as countries pursue low carbon capacity expansion.
Link to the full study HERE
Author: Bryan Groenendaal
