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Business Models and Profitability of Energy Storage
Felix Baumgarte1, Gunther Glenk2, Alexander Rieger3
1FIM Research Center, University of Bayreuth, Project Group Business & Information Systems Engineering, Fraunhofer FIT, Bayreuth 95444, Germany.
Iscience
|October 21, 2020
Summary
Identifying profitable energy storage investments is crucial for renewable energy growth. While some storage technologies and business models show profitability, many combinations require further research for a complete understanding.
Area of Science:
- Energy Systems Engineering
- Renewable Energy Economics
- Energy Storage Technologies
Background:
- The increasing penetration of intermittent renewable power sources necessitates robust energy storage solutions.
- Accurate assessment of investment opportunities and profitability in energy storage is vital for grid stability and economic viability.
Purpose of the Study:
- To develop a conceptual framework for characterizing energy storage business models and investment opportunities.
- To identify suitable energy storage technologies for various business models and review their profitability.
- To highlight neglected areas in energy storage research concerning profitability.
Main Methods:
- Development of a conceptual framework to categorize energy storage business models.
- Systematic differentiation of investment opportunities based on the framework.
- Literature review on the profitability of energy storage technology and business model combinations.
Main Results:
- Commercially available energy storage technologies can support all identified business models.
- Certain technology-business model combinations are nearing profitability, particularly those examined recently or involving stacked business models.
- A significant number of technologically feasible combinations remain under-researched.
Conclusions:
- Energy storage offers viable business models with commercially available technologies.
- Profitability is emerging for specific, well-researched or multi-faceted applications.
- Further research is essential to comprehensively understand the economic potential of diverse energy storage solutions.