Soaring energy prices is one of the many challenges facing telecom executives today. However, with intelligent energy storage systems, telcos can reduce costs, create new revenue streams, contribute to stabilizing power grids and be part of the solution to enable a more renewable energy system, according to Swedish battery developer Polarium.
Following the Russian invasion of Ukraine, energy prices have gone up all over the world, but Europe has been hit particularly hard. However, rising and more volatile energy prices cannot simply be explained by the Russian invasion. In fact, EU electricity prices are up 400 percent[1] since 2019, whereas price volatility has increased eight-fold.[2] Furthermore, the strained energy situation in Europe has led to a more unstable power grid, and an increased risk for power outages.
- Predicting energy prices is like predicting the weather – it is hard. But if you consider that the world is on a path of rapid electrification – meaning an increased demand of electricity – and that the incoming power supply will mostly be renewable from intermittent sources of energy. Neither prices nor price volatility can be expected to go down. Finding ways to intelligently manage energy costs will be imperative for telecom operators in this new energy landscape, says Peter Wasmuth, Head of Europe at Polarium, a Swedish battery developer.
From reserve power to energy optimization systems
Polarium was founded in Stockholm, Sweden, to challenge the global telecom industry to switch its reserve power from diesel generators or lead-acid batteries to long-lasting lithium-ion batteries. To date Polarium have installed over 350 000 batteries in more than 70 countries – from Sub-Saharan Africa to Svalbard. The next step is to help telecom to use reserve power capacity to intelligently manage its energy costs by optimizing the power load and actively participating in grid support markets.
- This is a huge opportunity for mobile operators. When power prices increasingly vary over the day, money can be made, by simply shifting your power load. Our systems allow companies to cut energy costs by charging their batteries when prices are low and use stored power when prices are high, says Peter Wasmuth
In addition, a combination of longtime underinvestment in grid infrastructure and an increase of intermittent energy supply, has created a market for grid support services – i.e. grid operators pay companies to provide capacity if and when needed to balance supply and demand.
- By upgrading your reserve power to an energy optimization system, you can reduce cost while creating new revenue streams. Based on data from 2022 we can see potential energy cost net savings of 30 up to over 100 percent, meaning net income depending on load profile, regional price volatility, and how the market is for grid support services is set up, says Peter Wasmuth
Help stabilize power grids and enable a more renewable energy system.
According to the International Energy Agency (IEA) there is currently unprecedented momentum behind renewables, with the world set to add as much renewable power in the next 5 years as it did in the last 20. The shift is most dramatic in Europe due to the urgent need to rid the energy system of its longtime dependent on Russian gas.[3]
Because of the load fluctuations and intermittency of renewable energy, energy storage is seen as a key component in the transition to a more renewable energy system.
- My experience is that people want to do good. We must rid our power systems from fossil fuels. Quickly. By adding much needed energy storage capacity, telcos can play a crucial part in stabilizing the grid and enabling the shift to a more renewable energy system. This is a great opportunity for telcos to lead the way and save money doing it, Peter Wasmuth ends.
[1] Average Wholesale Day-Ahead Price (EUR/MWh). Ember (2023) European wholesale electricity price data. https://ember-climate.org/data-catalogue/european-wholesale-electricity-price-data/.
[2] Spread of electricity prices calculated as the size difference of ranges for 2019 and 2022. Based on Ember (2023) https://ember-climate.org/data-catalogue/european-wholesale-electricity-price-data/.
[3] IEA (2022) https://www.iea.org/news/renewable-power-s-growth-is-being-turbocharged-as-countries-seek-to-strengthen-energy-security