The energy storage industry is experiencing rapid growth, with batteries playing a crucial role in the transition to a sustainable world. However, despite the tremendous promise of Battery Energy Storage Systems (BESSs), the industry faces a pressing issue: inconsistency in battery performance. Some BESS are promising more charge than they can deliver, while others are losing their ability to charge to full capacity far too early in their life. This inconsistency leads to storage operators missing revenue expectations and utilities tempering their enthusiasm for this potentially game-changing resource — at least, until it starts performing how they expect it to.
While it may be tempting to blame the hardware, the real culprit often lies in the software. Energy Management System (EMS) software, which manages energy flows between batteries and the grid, has so far largely run off inaccurate state of charge info and lacked both features and use strategies that could enhance performance, reliability and ROI in other ways. As Yann Brandt, Chief Commercial Officer of EMS provider FlexGen, explains, “Ultimately, whether batteries become a bigger part of our energy future is inherently dependent on software and analytics. That’s where the future of energy storage at scale really has to focus on, because batteries themselves, they always work — the hardware itself works — but getting it to turn on and off when you want it to is a software problem.”
The solution lies in advanced EMS that goes beyond inefficiently meeting immediate demands on the market based on inaccurate state of charge info. Brandt shares that the biggest software and operational needs revolve around enhanced performance analytics and using advanced EMS to respond to exceptional grid conditions in reliable ways. Future innovations will further unlock the power of storage.
Above all, the importance of real time performance data — including state of charge down to individual cells — cannot be overstated. Inaccurate readings can lead to storage owners either missing out on revenue opportunities or facing substantial penalties for not delivering promised energy to the grid. During the development of their
advanced EMS application HybridOS Analyze, the FlexGen team ran dozens of systems through testing; they found that even new batteries exhibited up to 20% inaccuracy in charge information, with some arrays getting just half their nameplate capacity due to energy bottlenecks created by faulty cells. With the potential for tens of millions of dollars in lost revenue or penalties, Brandt estimates the cumulative hit to the storage industry to be in the billions of dollars per year. And concerns about missed commitments lead to fewer investments by utilities and less favorable contracts to independent power producers (IPPs) – which generates fewer investments in IPP BESSs.
Advanced EMS addresses this issue by providing real-time data and actionable insights. Storage owners who fully understand their systems’ battery health and state of charge can accurately commit to meet energy market needs, maximizing benefits in the process. And owners who cycle systems ahead of high-demand, high-revenue months can do preventative maintenance on faulty cells, guaranteeing performance when it’s needed most.
Other pieces of advanced EMS are making BESS resources increasingly reliable in a changing climate. Take the example of Winter Storm Uri, which hit Texas in February 2021 and featured temperatures low enough to render idle BESSs inoperable. A case study highlighted how one BESS operator with multiple sites simultaneously charged and discharged systems during Uri: the strategic flows of electrons, enabled by advanced EMS, cost nothing on the wholesale market but kept the BESS installations warm enough to have a 99.7% uptime through the 5-day event. As a result, the operator secured significantly more revenue than its competitors while supporting a strained grid and struggling customers.
The benefits of advanced EMS extend beyond individual BESS operators. By helping operators maximize their revenues and avoid penalties, these platforms will spark investments in storage that make the grid more efficient and sustainable. Utilities will become more comfortable with the technology as batteries consistently meet their theoretical potential, leading to increased adoption by both utilities and IPPs. “At a high level, what the grid operators want, what the utilities want, is they want the batteries to do what they claim they can do – what they were supposed to do when they bought them,” says Brandt.
In conclusion, advanced EMS and analytics are the key to unlocking the full potential of energy storage. By providing real-time data on battery performance and state of charge, strategically managing energy flows, and more, these increasingly sophisticated platforms enable storage owners to optimize their operations, maximize their revenues, and avoid costly penalties. As the industry adopts these solutions, utilities will gain confidence in the technology, leading to increased investment and a more efficient, sustainable grid that benefits everyone. The future of storage as a utility resource is bright – and it’s powered by advanced EMS.
