Opportunities for Electricity Storage and Demand Side Management in Spain

Business opportunities for Storage and Demand Side Response in the Spanish Electricity Market

Energy Storage Systems and Demand Side Response (DSR) are expected to become key elements of the future electricity system as increasing renewable capacity requires new sources of flexibility.

Spain is lagging on the development of these flexibility mechanisms with respect to European countries such as UK, France and Germany where batteries and DSR already play an important role in their national electricity systems. In Spain, until 2020, regulation did not contain any provision on the participation of demand and batteries on balancing markets.

In December 2019, the Spanish Balancing Code opened balancing markets to storage and DSR. With some regulatory developments and operational procedures still pending, storage operators and demand aggregators are now allowed to act as Balancing Services Providers (BSP) and to operate under the same rules and conditions as generation units.

In MRC, we have analysed business opportunities for storage and DSR as BSP and alternative revenue sources that may appear in the future.

The study combines a comprehensive review of the regulatory framework with an explanation of each type of balancing service. We also undertake a quantitative analysis of the historical evolution of the market and we assess the main drivers of the Spanish electricity and ancillary services markets during the next decade. The study includes a preliminary valuation of each business model based on different price forecast scenarios for the 2021-2030 period.

The objective of the report is to assess the risks and opportunities related with the development of storage facilities and DSR activities.

The report comprises all the elements affecting the feasibility and profitability of each business model proposed. We use a robust methodology aiming to provide our clients with objective and reliable analysis, a valuable guide under the uncertain scenario that the Spanish electricity market faces for the next decade. Moreover, we try to create value for our clients using MRC experts’ market vision based on more than 15 years of experience analysing the Spanish electricity market.

We offer market advisory services for storage and DSR businesses with the following scope:

In MRC, we adapt the scope of our services to the specific needs of the client. Energy Storage and DSR have several points in common that justify analysing them jointly. They are both sources of system flexibility and it is expected that their operation will be focused on balancing markets. However, there exist some important differences on the potential business models and some particularities on the regulatory framework that differently affect storage operations and DSR.

Therefore, we allow our clients to choose the scope of the report according to its interests.

To get additional information on the Storage and DSR report please contact with: