Germany's battery boom could block grid access for industry and power plants

The rapid growth of battery storage projects in Germany is raising concerns among transmission system operators about an impending grid connection capacity bottleneck. Investors are currently applying to connect projects with a combined capacity of more than 250 GW. Transmission system operators are therefore calling for a change in legislation to prevent irreversible “lock-in” effects that could threaten access to the grid for industry, data centres and new power plants. The government is also considering setting an upper limit on battery development.

According to German transmission system operators, current grid connection applications include battery storage projects with a combined capacity of more than 250 GW. The operators warn that the current rules give priority to projects that apply first, regardless of their benefits to the grid.

This could leave no room to connect new industrial facilities, data centres or power plants. According to the operators, this situation could persist until the end of the 2030s.

The operators have published a document, according to Montel, calling for a new system for allocating grid connection capacity that places greater emphasis on how well projects align with the needs of the transmission system.

The rapid growth in battery projects is being driven by the increasing share of wind and solar power in electricity generation, which is causing greater fluctuations in electricity prices. Overproduction during periods of low demand pushes prices down, sometimes into negative territory, while evening peaks drive them sharply higher. Batteries can therefore buy electricity very cheaply and sell it during periods of high demand, making them an attractive investment.

One proposal being discussed is for Germany's grid regulator, the Bundesnetzagentur (BNetzA), or the government itself to set an upper limit on the development of large-scale battery storage. Although the number of applications to connect storage facilities is extremely high, Germany currently has 15.7 GW of battery storage installed, with a capacity of 23.3 GWh, according to Energy Charts data. BNetzA data show that this includes 921 large-scale battery systems with a combined capacity of 2.3 GW and a storage capacity of 3.2 GWh.