The European energy sector is gearing up to deploy tens of gigawatts of Battery Energy Storage Systems (BESS) in the coming years. While this rapid expansion presents immense opportunities, it also brings notable challenges. Many developers, relying on strategies that have worked for renewable projects like photovoltaics (PV), often overlook critical nuances specific to BESS. Failing to account for these complexities can put the financial viability of BESS investments at serious risk.

Developing a Battery Energy Storage System (BESS) project typically takes about two years and involves several critical steps, including securing grid connections, obtaining financing, and acquiring necessary permits. Once these milestones are achieved, the construction phase is relatively swift, lasting approximately six months. However, it’s the operational phase—often stretching over 15 years—that ultimately determines the asset’s long-term success and value. Despite its importance, developers frequently dedicate minimal planning to operations, a trend also observed in photovoltaic (PV) projects. For photovoltaic (PV) projects, the technology’s simplicity and maturity enable stakeholders to prioritize high-level planning, deferring operational details to later stages. Managing PV systems primarily involves optimizing energy output and addressing occasional grid curtailments requested by Transmission System Operators (TSOs). Modular system designs and advancements like new string inverters further enhance efficiency by minimizing downtime, even during partial outages.

The evolution of strategies in PV projects offers valuable insights. Developers have navigated challenges such as supply chain disruptions, financing obstacles, and grid connection delays. Here are some key milestones to consider:

These insights highlight the critical need for proactive planning. While operational bottlenecks are uncommon in PV development, they require special focus when it comes to BESS.

While BESS shares certain challenges with PV and wind technologies, it also introduces a unique set of complexities:

1. Equipment Costs and Supply: Battery costs are steadily decreasing, and manufacturing capacity currently exceeds market demand. For now, material shortages are not a pressing issue.

2. Challenges with Grid Connections: Connecting Battery Energy Storage Systems (BESS) to the grid is significantly more complex than linking photovoltaic (PV) systems. Unlike PV systems, BESS functions as both a consumer and a generator, creating unique challenges, particularly in grids that are already nearing capacity.

3. Challenges in Securing Financing: Obtaining financing is often complicated by limited operational histories and unpredictable revenue streams. Income sources like energy shifting, ancillary services, and capacity markets are inherently variable and uncertain, making it difficult to attract financial backing.

Developers specializing in solar and wind projects often concentrate solely on immediate challenges, such as securing permits, grid access, and financing, while leaving operational planning as an afterthought. However, this reactive approach can lead to significant risks down the line. At Cellect Energy, we believe that integrating operational planning into the early stages of development is essential to ensure sustainable, long-term success.

Working with BESS at Cellect Energy over the years has highlighted key challenges that developers need to tackle from the outset:

1. Fast-Paced Technology Evolution: Manufacturers regularly release new battery models, posing challenges for long-term compatibility across product portfolios. By diversifying suppliers, companies can reduce reliance on a single source while maintaining flexibility to adapt to advancing technologies.

2. Data Overload: BESS assets produce data at a rate multiple times higher per megawatt compared to PV systems. To manage them effectively, it’s crucial to have the right tools in place to process, analyze, and transform this data into actionable insights.

3. Data Quality Challenges: Battery Management Systems (BMS) frequently generate data that is inconsistent or of poor quality, particularly in key metrics such as State-of-Charge (SoC) and State-of-Health (SoH). These inaccuracies can have a direct and significant impact on overall system performance.

4. Navigating Warranty Challenges: Managing warranties can be a daunting task, yet it’s crucial for successful BESS operations. Staying compliant requires thorough documentation and proactive monitoring. Explore our in-depth whitepaper to learn how to streamline warranty tracking and enhance performance.

5. Limited Operational Experience: The limited number of operational BESS systems globally means developers have a smaller data pool to draw from when refining their strategies. While early projects offer valuable insights, these lessons must be quickly and effectively implemented.

6. Market Participation Dynamics: Participating in energy markets such as EPEX Spot, Nord Pool, or OMIE requires collaboration with energy traders and optimizers. Developers operating assets across multiple countries may need to engage with different partners for each market—or even multiple partners within the same market—to identify the most effective and high-performing solutions.

7. Market Variability: Ancillary service and capacity market structures differ significantly across countries. While EU initiatives such as PICASSO (Platform for International Coordination of Automated Frequency Restoration) and MARI (Manually Activated Reserves Initiative) strive to standardize processes, regional disparities remain a challenge.

8. Co-located vs. Standalone Systems: Systems integrated with wind or solar (PV) plants require unique strategies that differ significantly from those designed for standalone setups.

9. Seamless Team Coordination: Strong cross-departmental communication is essential for efficiency. Misalignment between Asset Management and Operations & Maintenance (O&M) can create costly inefficiencies. Discover strategies to eliminate communication barriers in energy storage operations by exploring our whitepaper: Breaking Communication Barriers.

10. End-of-Life Impact: Proper planning is essential to ensure batteries are recycled effectively and environmental impacts are minimized. Discover practical strategies for creating more sustainable BESS solutions in our dedicated blog: Explore sustainable BESS strategies.

Neglecting to plan for BESS operations during the development phase can lead to inefficiencies, increased costs, and diminished profitability. By proactively addressing potential challenges early in the project lifecycle, developers can set their assets up for seamless transitions and reliable performance over time. Discover the key Do’s and Don’ts of selecting your Asset Management Platform in our exclusive whitepaper.

At Cellect, we are dedicated to equipping you with the tools needed to manage BESS assets efficiently and reliably. Our support begins in the early development stages and continues throughout operations until the end of the asset's lifecycle.

The Cellect Platform is the only asset management solution dedicated exclusively to BESS, offering real-time monitoring and management of your storage systems. Gain actionable insights to optimize operations and improve performance. With Cellect Control, streamline your control processes and enhance trading efficiency through advanced battery analytics and event notifications. Our Cellect API ensures seamless connectivity between your assets and stakeholders, delivering comprehensive operational data and analytics in one centralized source of truth.

Our solutions are crafted to optimize operations for technical and commercial asset managers, as well as operations and maintenance teams. By leveraging automated analytics and centralized platforms, we help reduce downtime and increase revenue. Whether you're overseeing a large utility-scale storage portfolio or embarking on your first project, our team is dedicated to supporting you at every stage of the journey.

Want to learn more? Reach out to our team today to discover how we can help drive your BESS strategy forward. Contact us to get started.