What are Battery Energy Storage Systems?

What are Battery Energy Storage Systems?

If the world is going to transition to a low-carbon economy, it’s going to need batteries. And lots of them.

All batteries allow electrical energy to be stored and supplied when it’s needed. Battery energy storage systems, known as BESS, go hand-in-hand with renewable energy generation. By managing renewably-produced electricity more effectively, batteries can help us wean off our reliance on coal and gas. 

Without adequate battery storage, an awful lot of clean, green electricity is going to be wasted. This gives the fossil fuel industry a chance to keep its foot in the door and provide energy during peak times. But willing investment is there for BESS, with the global market expected to double its size today by 2030. 

The article will take an in-depth look at BESS, covering the fundamentals, different types and uses of these important renewable energy enablers. 

What is BESS?

Battery energy storage systems are advanced solutions for storing electrical energy to use at a later time. We’ve all used the little AA batteries to power small devices, but BESS are transforming the way energy is managed and utilised in a much larger way.

One of the common arguments against renewable energy is that it doesn’t create a wholly reliable system. For example, the sun isn’t always shining and the wind isn’t always blowing, therefore energy can’t be generated 24/7. 

So, what do we do when we want energy and these natural resources aren’t generating electricity? 

We use stored energy in battery systems. This is why BESS are essential for the green energy revolution. 

  • It’s predicted that the UK will need 100TW of energy storage by 2050 to support the electrification of transport, heat and business. Currently, there’s just 3.5GW (0.0035 TW) of battery storage capacity in operation, but over 80GW in the pipeline between construction, consented, planning and pre-development.

The beauty of BESS is that they are flexible and can operate across a range of scales.

Large scale, industrial sized BESS are designed to support national grids, whereas smaller battery storage systems can support domestic level energy. In between these two, you have commercial BESS for industrial applications. 

Whatever the size of the BESS may be, the principle of storing energy is the same. 

How do Battery Energy Storage Systems work?    

Battery energy storage systems are made up of several important components, including one or more batteries, a management system and a power conversion system.

A BESS is charged during periods of low energy demand or when surplus energy has been generated by a connected system. The main ways to charge batteries come from renewable energy sources like solar and wind.  

Let’s take a solar panel as an example. When sunlight hits a solar photovoltaic panel, electrons are ‘excited’ and start to move around. Solar cells within the PV panel convert this energy into direct current (DC) electricity.  

The DC current from each solar panel then flows through cables down into an inverter. This will either be a solar inverter or a hybrid inverter. Two things can then happen to the DC electricity:

  1. It’s sent to the battery storage system to charge up the batteries. Here, the energy is stored until it’s needed at a later time, such as in the evening when solar isn’t functioning.
  2. It’s converted to AC electricity where it’s used to meet immediate domestic needs, such as powering your washing machine or TV. 

On a larger scale, once a battery is charged, the stored energy can be used directly by connected electric systems or it can be released back into the grid to meet consumer demand.

The significance of BESS extends beyond just energy storage too. By integrating smart software and control systems, these batteries can optimise energy distribution based on real-time demand and supply conditions. This helps with both energy stability and efficiency.

Types of batteries used in BESS

Several types of batteries can be used in battery energy storage, but there are two common types that are favoured:

  • Lithium-ion batteries
  • Flow batteries

Lithium-ion batteries are leading the way when it comes to battery storage both on a domestic and industrial scale. They are known for their efficiency, long life cycle and high energy density, meaning they are relatively compact in size. 

Flow batteries differ in design from solid batteries. Instead, they rely on pumped liquid electrolytes for energy storage capacity and power. 

Flow systems have lower energy density and require a lot of space, meaning they’re more suited for grid-scale storage and large scale applications. They have a long lifespan and can last for a number of decades. 

Can batteries be used without a solar connection?

Solar and batteries are often talked about synonymously. However, it’s still possible for homes to use storage batteries without a solar connection. 

This is because Battery Energy Storage Systems can be charged from the grid. The wisest way to do this is during off-peak times, such as in the middle of the night, when electricity prices can be substantially lower. This stored energy can then be used during the day when electricity prices are higher. Clever, right? The possibility and prices associated with this will all depend on your tariff though. 

Alongside smart energy bill management, there are a few reasons why homeowners may go for battery storage without solar. 

You might have a battery for backup power in case of grid outages or to help stabilise the grid during peak demand and receive a payment for your support. This latter point comes under the Smart Energy Guarantee (SEG) scheme. With SEG, your energy company should be able to offer you a tariff for any renewable energy you export to the grid.

Some homeowners may want to future-proof by installing a battery first before adding solar panels later on. 

Benefits of Battery Energy Storage Systems

By investing in battery storage systems, you can unlock a wide range of benefits. This is true for both homeowners and the electrical grid at large. 

Here are the main advantages associated with BESS. 

Homeowner benefits:

  • Savings on electricity bills by storing lower cost off-peak grid electricity to use later during high price peak times
  • Improved efficiency by optimising the use of generated energy
  • Provides reliable backup power during grid outages
  • Renewable energy supply 
  • Increased energy independence

Grid benefits:

  • Helps to green up the grid by integrating more renewable energy generated electricity, mainly from solar and wind
  • Avoid costly power plants only used during periods of peak demand. These generally pull energy from gas turbines
  • Can reduce the demand on the grid during peak hours by storing energy when demand is low and releasing it when demand is high
  • Supports grid stabilisation

Environmental benefits:

  • Facilitates transition away from fossil fuel plants towards renewable energy as widespread electrification continues 
  • Lowers carbon emissions when combined with clean energy
  • Reduces from generating renewable energy that isn’t used

How much do Battery Energy Storage Systems cost?

Ok, Battery Energy Storage Systems sound great, but how much do they cost?

The cost of installing a BESS at a residential scale can vary quite considerably. The price is influenced by several factors, including the system’s capacity, technology type and potential connections to solar panels. You then have the installation costs too.

Due to these differing factors, you can realistically expect to pay between £4,500 and £10,000 for a decent sized battery storage system. To give you a good rule of thumb, you can expect to pay an additional £900 per kWh of storage capacity. 

The prices in the table below give you a rough estimate of how much you’d expect to pay based on the capacity for a lithium-ion battery. Lead-acid batteries are slightly cheaper, but they aren’t a real long term solution. The battery size you go for will all depend on your household needs. 

Battery size (kWh)Battery price
3-5£2,500 – £5,000
5-7£3,500 – £7,500
7-9£5,000 – £10,000
9-12+£8,000 – £13,000+

Solar battery grants

Until March 2026, the UK government is running the ECO4 Scheme, which has set aside £4 billion for the installation of solar panels and heat pumps.

ECO4 aims to support the lowest income households transition to low carbon energy. However, there is a ‘LA Flex’ scheme, whereby your Local Authority can expand the eligibility for those who may not meet the original criteria. 

Alongside this but not specifically battery-related, VAT on solar panels has been reduced from 5% down to 0%. 

VAT on battery storage systems has now been removed, read more about the drop in battery VAT here.

Aside from these measures and the SEG scheme to get paid for storing excess energy, there are no specific grants for battery energy storage systems. 

About the author 

Ben Hardman

Ben is a professional writer and the creator of sustainable living website TinyEco.com.
It's here where he helps people to reduce their environmental impact through simple, everyday choices. Away from the laptop, Ben loves spending time in the natural environment with his young family and Murphy the cocker spaniel.

First Class BSc Biology degree (environmental and climate change focus)
Six years of working and writing in the environmental sector, including two years working at an international sustainability consultancy
Written for Ethical Consumer magazine, My Mother Tree, Unsustainable Magazine, Happy Eco News, Emission Index, PeakDistrict.org
Commented in The Independent, The Guardian, GreenMatch. Also featured on Radio 1's environmental special 'Minute of Me'

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