Energy storage is key to consumers enjoying reliable, affordable, and clean energy into the future while also ensuring that the grid remains reliable. But to achieve this, we will need different scales of storage working together. 

While there’s lots of buzz about household and large-scale batteries, there’s scant information on the in-between – community-scale batteries. To better understand this gap, we commissioned the Brattle Group to conduct initial research into the ‘missing middle’ in the storage market.

The outcome of this exploratory research, Unlocking the Value of Community-Scale Storage for Consumers, is an important first step in beginning to understand this area. It investigates the opportunities of community-scale batteries for consumers, identifies barriers to community-scale storage deployment and adoption, and determines approaches for overcoming these barriers.

We acknowledge that further, and perhaps contradictory insights about the relative strengths and weaknesses of various storage types will emerge as more data becomes available.

While this is an exploratory report, the research indicates that community-scale storage has the potential to provide economic benefits to Australian energy consumers because it can combine the cost savings of larger-sized batteries with benefits that can only be achieved from distributed resources. 

However, realising this potential is not a given – the policy settings need to be right for this to occur. The success of community-scale storage projects will depend on:

• Its location in particular parts of the network that need storage the most.  
• A decrease in the installed costs of community-scale storage projects 
• The ability of the energy system to reward community-scale storage (and consumer energy resources more broadly) for the value they provide. 

To unlock the full potential of community-scale storage, government, industries, and communities will need to work together.

The report highlights three key priorities to enable community-scale storage implementation and ensure all consumers benefit:

1. The electricity market’s design needs to evolve so that small-scale resources are rewarded for the services and benefits they provide.
2. Community-scale storage (and consumer energy resources) will provide more value in certain locations of the network than in others.
3. The long-term success of community-scale batteries in delivering value to consumers will depend on the local industry and the broader supply chain reducing costs.

This report is exploratory in nature and provides helpful initial insights into this emerging area. The report shows value in further research to provide more detailed information on the way forward and to understand the best types of storage for consumers.