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EY RECAI Demands Change Of Mindset Towards Energy Storage

We can no longer wait for energy storage to “change the game,” because it already has, according to the most recent Ernst & Young Renewable Energy Country Attractiveness Index.

Ernst & Young’s 44th issue of its Renewable Energy Country Attractiveness Index (RECAI) makes a point to focus on explaining how energy storage is well past simply being a “game changer,” and how it has already changed the game.

“With many storage technologies already proven and costs falling fast, it’s not about waiting for the game to change,” write the authors of the report. “It already has, and business as usual is no longer an option. It is now time therefore, to focus on developing a clearer view of the investment opportunity, the business models, and the most suitable markets.”

According to Ernst & Young (EY), investors are unsure how energy storage “can deliver a return on capital invested” because energy storage is “still often talked about in either vague or overly technical terms” making it “difficult for investors to get a clear view of the investment opportunity, the business models, and the outlook.”

“With a number of storage technologies already proven and costs falling fast, we must stop thinking about storage as something that will arrive tomorrow. It arrived yesterday and the game is already changing,” said Ben Warren, EY’s Global Power & Utilities Corporate Finance Leader and RECAI Chief Editor. “It’s time to start viewing storage as just another energy asset that generates long-term predictable revenues and needs competitive and appropriate construction capital solutions.”

EY-2

Despite encouraging market forecasts — with Lux Research projecting a $10.5 billion grid storage market by 2017, and Bloomberg New Energy Financing predicting energy storage capacity levels to reach 11.3 GW by 2020 — EY is clear to point out that “the investment case for storage can also be complex given the numerous technologies, applications, customers, and market drivers.” The authors of the RECAI’s article on energy storage conclude:

In short, with a number of storage technologies already proven and costs falling fast, we must stop thinking about storage as something that will arrive tomorrow. It arrived yesterday, the game is already changing and investors need to ask themselves, how they can use the technology to secure the necessary returns in the future.

 
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