Analysis of the market conditions for storage in the German day-ahead and secondary control market

This paper analyses the market conditions for energy storage systems in today´s day-ahead and secondary control market. It also deals with the question, to which extend market designs need to be changed to enable the competitiveness of storage systems. On basis of the market development in 2012 the maximal break-even capital expenditures for new storage systems in the day-ahead market are 130 €/kWh. In relation to the actual costs of large scale battery systems it remains clear that batteries are still too expensive to be profitable. For the integration of battery storage systems in the secondary control market a change of the tendering framework is required to offer suitable conditions for providers with a limited storage capacity and operation time. One option would be a market division into two or more segments according to the control demand, possibly with a further reduction of the tendering period to one day or hours.