Building-level energy storage: reducing consumer bills to deliver zero-emissions heat

Building-level energy storage allows consumers to capture cheap electricity or heat when it is available and store it for later use.

This report examines the extent to which such technologies could help to reduce household energy costs when installed alongside zero-carbon heat technologies.

We also present results from a simulation exercise to determine the cost effectiveness of electric batteries, heat batteries and thermal storage installed alongside heat pumps.

The key findings show that currently there is little commercial benefit to the householder installing storage without localised electricity generation. However, the potential role of domestic storage in smoothing peak demand periods on the grid indicates that building-level storage will be required to support the decarbonisation of heat through electrification.

Recommendations

• Once published, the monitoring results from ongoing projects with building-level storage should be reviewed for evidence of financial savings for consumers. This includes the UK Department for Business, Energy and Industrial Strategy (BEIS) electrification of heat pilot, OVO Energy’s trial with Powervault and various project that are funded by the Scottish Government.  
• Ensure the Distribution Network Operators (DNOs) in their transition to District Systems Operators (DSO) actively provide support for local and national flexibility markets by engaging with aggregators when planning for the increased future demand on the grid.
• Where feasible, installers and property owners should be encouraged to pair thermal storage with heat pumps. Although there is limited evidence of the direct financial savings that this can provide for consumers, the benefits of improved system efficiencies, heat pump longevity and the ability to ease pressure on the grid during peak periods will provide indirect financial benefits.
• Grant funding or some form of financial incentive may be necessary to encourage the installation of thermal storage with heat pumps.
• Further research is conducted to understand what the identified savings from existing and ongoing research might mean for rates of fuel poverty.