<img src=https://nenpower.com/wp-content/uploads/2025/04/image-10307.webp alt=’How do different countries’ regulatory frameworks compare in supporting energy storage’ />
United States
- The U.S. has taken significant federal steps to integrate energy storage into electricity markets, primarily through Federal Energy Regulatory Commission (FERC) actions.
- FERC Order 841 (2018) directs regional transmission organizations (RTOs) and independent system operators (ISOs) to remove barriers that prevent energy storage from participating in wholesale electricity markets.
- This order mandates that storage be treated as both generation and load, enabling participation in energy, capacity, and ancillary services markets.
- Various states, such as California, have additional initiatives, including procurement mandates and incentives targeting battery energy storage systems (BESS), which enhance renewable integration and grid resilience.
- Despite these advances, challenges remain like inconsistent regulations across regions and the need for coordinated operational protocols between renewable energy sources and storage systems.
European Union
- The EU integrates energy storage policy as part of its broader Clean Energy for All Europeans legislative package.
- Member states are required to develop national energy and climate plans that include clear targets and strategies for energy storage deployment.
- The EU supports innovation and deployment with substantial funding through programs like Horizon 2020.
- The regulatory approach emphasizes market integration, grid stability, and creating a level playing field for all flexibility resources.
- The framework fosters cooperation between industry stakeholders to accelerate technology development and market adoption.
General Observations and Challenges
- Across countries, regulatory frameworks aim to evolve continually to provide effective pricing signals and remove barriers to energy storage participation in markets.
- Many frameworks still face challenges such as the lack of standardization, unclear operational and dispatch rules for battery storage, and limited coordination with renewable energy systems.
- Financial incentives, procurement mandates, and policies specifically targeting the role of energy storage in grid stability are common tools used to boost deployment.
- Successful frameworks couple clear regulatory targets with mechanisms ensuring fair market access and fostering innovation, thereby increasing energy storage penetration and overall grid flexibility.
In summary, the U.S. leads with FERC’s market reforms enabling storage participation in wholesale markets, while the EU combines regulatory mandates with innovation funding and strategic planning. Both approaches highlight the importance of adapting regulatory frameworks to effectively integrate energy storage into evolving power systems, although further harmonization and addressing remaining policy gaps are needed globally.
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