Statkraft has claimed an ‘industry first’ in agreeing a battery forward trade on behalf of battery owner Statera Energy.
Statkraft is a renewable power generator and provider of market access and optimisation services.
It says the financial return secured for a battery owner depends on short term price fluctuations in the energy markets because batteries are usually are optimised in the frequency response, ‘day ahead’ market (via day-ahead auctions) or in the ‘intra-day’ market (via trades on the day of delivery).
But Statkraft says it has created a customised ‘forward trade’ product for batteries such as Statera’s Creyke Beck Storage project, near Hull, which has been used as part of the 15-year strategic partnership between the two companies.
In forward trades, the sale or purchase of power is agreed in advance of delivery. Statkraft simultaneously sells overnight power to charge the battery and buys the evening peak power discharge in volumes appropriate to the assets’ technical capabilities. It eliminates Statera’s price risk because the trade product locks in the buy and sell prices at the same time.
Stratkraft says forward trades backed by battery capacity will help flexible assets to smooth out their earnings by forward-hedging portions of their income. It will also increase liquidity in the forward market.
Brian Lonn, Statkraft’s Head of UK Flexibility said: “Although battery forward trading has been discussed in the past, we believe that the transaction we’ve conducted on behalf of Creyke Beck Storage is the first to have been completed successfully using this kind of structure. … This customised product can be utilised by any of our customers and will help bring greater returns and more certainty to their portfolios. We’re anticipating a great deal of interest in it.”
Tom Vernon, Managing Director of Statera says: “We are delighted to have concluded our first forward trade with Statkraft for one of our 50MW battery assets, Creyke Beck Storage. Working with Statkraft to access the forward markets this winter, we have materially enhanced the risk/return profile of the revenues on our battery storage and flexible generation portfolio.”