Techno-socio-economic bottlenecks in increasing battery capacity for supporting the energy transition

Ville Sihvonen, Aki Grönman and Samuli Honkapuro

Renewable and Sustainable Energy Reviews, 2025, vol. 210, issue C

Abstract: Battery energy storage systems (BESSs) have been identified to have a good potential to offer valuable ancillary services for many of the challenges that the transition towards highly renewable energy systems might bring, both on local and system levels. This study presents a techno-socio-economic analysis of bottlenecks in increasing the battery capacity, specifically to offer ancillary services. Analysis covers technical capability, economic feasibility, environmental aspects, and regulative issues of BESSs providing support for the power system. This paper contributes by identifying current bottlenecks in increasing battery capacity to support the transition to carbon-neutral renewable energy systems and provides potential solutions for policymakers, researchers, project developers, and storage owners to relieve these identified barriers. Based on the analysis, BESSs can offer high performance for many of the needed ancillary services, proving very good technical capability. The main challenge for a breakthrough in capacity addition can be identified to be economic feasibility. The major limiting factor is the upfront investment cost of varying BESS technologies, but in the case of providing ancillary services, another factor is related to the regulation, especially in electricity markets. It becomes vital to develop electricity markets further and guarantee access to the market for BESSs. Recycling of BESSs, especially lithium-ion batteries, must improve to reduce the need for new critical raw materials and lessen the overall environmental impact.

Keywords: Ancillary service; Battery energy storage system; Distributed energy resources; Energy transition; Grid support (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1016/j.rser.2024.115259

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