Experimenting with co-ownership of energy storage facilities - A case study of the Netherlands

Abstract

This article discusses how shared ownership of energy storage facilities between grid managers (Distribution System Operators and Transmission System Operators) and third-party market participants may help to resolve congestion issues. The article uses the Netherlands as a case study on how congestion issues may lead to a stalemate: increasing energy storage capacity may help to resolve grid congestion but may cause additional congestion if used to trade in profitable markets. As a result, it is not installed, or installation is delayed until the grid is fortified. The article discusses how shared ownership may lead to the co-optimization of investment decisions by different stakeholders and of the operation of the storage facility. It also discusses how the exemption to unbundling obligations under art. 36 (2) of Directive 2019/944 can be used to allow for these ownership constructions. The article argues that national regulatory authorities can use regulatory experimentation to find the desirable conditions and uses of the exemption and to stimulate regulatory learning. The use of experimentation can help to resolve congestion issues in certain localities in the short term and help to develop principles for regulation of the future energy system in the long-term.