DIGITALIZATION AND

THE FUTURE OF ENERGY

STORAGE

SAFER, SMARTER, GREENER

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01
INTRODUCTION
The world’s energy system is changing profoundly.
By 2050, 63% of the world’s electricity will be supplied
by solar PV and wind. This large share of renewables
requires a considerably more flexible energy system.
Integrating renewables into our grid and relying on
them as our main source of energy will depend in part on
how much energy can be stored after generation, to be
used when it’s needed. DNV GL’s new Energy Transition
Outlook 2019 forecasts that to cope with this influx of
renewables, storage capacity will expand nearly 50-fold
from today’s levels.
1
Although widespread adoption of storage technologies
is in its infancy, the variable nature of wind and solar
means that if we are serious about expanding our use of
renewable energy we will need storage technologies to
make it happen.
About the research:
This report is based on a global survey1 of 1,919 energy
industry professionals. The respondents represent a
range of business sizes from start-ups to large corporates
and a range of functions within the industry, from
board-level executives to senior engineers, developers
and financiers.
Conducted by Foresight Factory in December 2018 and January 2019
 DIGITALIZATION AND THE FUTURE OF ENERGY STORAGE 03

02
ENERGY STORAGE - DIGITAL TO THE CORE
Storage technologies are inherently digital. This is Our research of almost 2,000 stakeholders within the
because storage is dispatchable and can act as both energy industry reveals that 43% of respondents working
a load and a generation source at different times; the with energy storage have digitalization as a core part of
intelligent timing of this cycling is dependent on the their publicly stated strategy. However, just 26% of energy
instantaneous needs of the electricity market and relies storage companies feel more advanced than the wider
heavily on digital decision-making. For many new players energy industry in their application of digital technology.
in the energy storage market, the challenge isn’t about
digitalization to improve process efficiencies as we see When it comes to the perceived benefits of digitalization,
in other industries. It’s about bringing innovation to those working in energy storage place improving
a traditional market, and co-creating the future of the operational efficiency (54%), improving decision making
energy landscape alongside the conventional energy (42%) and helping innovation (39%) as top priorities.
value-chain and legacy technologies. We surveyed the
energy storage industry to reveal the current progress of
digitalization; to uncover which digital technologies are
making an impact; which barriers the industry is facing
and how organizations can take advantage of the many
opportunities that digitalization presents.
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03
THE SILICON VALLEY OF THE ENERGY
WORLD

The energy storage industry’s prioritization of innovation
isn’t surprising. This young industry shares many qualities
with the global tech giants, many of which grew from
an idea to global domination in less than a decade.
The energy storage market looks set to follow a similar
path, with analyst Globaldata forecasting that the battery
storage market will be worth $13 billion by 2023.
The storage industry’s attitude to investing in digitalization
also reflects a willingness to try new initiatives with 75% of
respondents saying their organisation proactively invests
in digitalization to meet its goals.
The ability to create new technologies and solutions
in a young but rapidly growing industry is an attractive
prospect. Our research shows that the energy storage
industry is offering employees the chance to influence and
directly shape the digital strategies of their companies;
with 70% of respondents saying that they are involved in
shaping digital strategy or have influence over investment
and spending on digital transformation.

Which technologies are impacting the energy storage industry today?

Data visualization Automation and Cyber security Advanced analytics Cloud computing IoT (e.g. sensors and
(61%) digital workflow (52%) (e.g. artificial intelligence (48%) edge computing)
(57%) & machine learning) (46%)
(49%)

Drones and UAVs Coding Distributed computing Blockchain Augmented and Other
(32%) (28%) (21%) (21%) virtual reality (3%)
(18%)

?
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TECHNOLOGY AT A GLANCE

A key challenge with digitalization is keeping pace with technological change and user adoption rates. The following
technologies were identified by energy storage respondents as being important for their organization to invest in.

CYBER SECURITY: The focus on cyber security in the energy storage sector has been growing. Earlier this
year a German consultancy demonstrated the ease with which its experts could break into commercially
available PV inverters, used to communicate with storage systems or solar panel arrays. In a real-life scenario,
this could have led to hackers manipulating power outputs, damaging batteries or even bringing down a local
grid system. As our energy landscape becomes more distributed and connected storage solutions become more
widespread, the potential for vulnerabilities will increase and cyber security needs will grow.

DATA VISUALIZATION: This technology’s importance can’t be overlooked in the energy storage sector.
Trying to manage how storage interacts with grids will become ever more complex as renewable generation
grows and the interaction of load, price and available supply becomes critical. Using data visualization to
understand load, supply and battery dispatch for grid and behind the meter applications will enable the right decisions
to be made and value to be maximised.

AUTOMATION AND DIGITAL WORKFLOW: The increase of storage assets in the energy system makes
automation vital for connecting, managing, securing, proving value, improving efficiency and ensuring
continuity.
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05
UTILIZING TECHNOLOGY & ADDING
VALUE WITH STORAGE

Some of today’s storage and energy solutions are
focused on a single task, but many are leveraging
software to increase their functionality to meet higher
economic returns by value-stacking. Value-stacking,
the process of being able to perform multiple tasks at
the same time unlocks huge potential value and new
business avenues for the storage industry. For instance,
using the same battery for different applications, an
example of this is seen in the electric vehicle (EV) sector.
EVs will play an important role in the integration of
variable renewable generation due to the flexibility that
will be available from smart charging and vehicle-to-
grid (V2G) services. V2G technology expands upon the
potential of smart charging by enhancing the utilization
of the battery storage of EVs by allowing power to flow
in both directions, between the electric network and
EVs. In addition to powering EVs for typical usage, the
batteries are used as electrical storage for the electricity
network. Using batteries in this way has numerous
applications: from managing demand, to ensuring an
increased share of renewable energy is used2.

06
INVESTING IN THE FUTURE
Unlike other energy industries, the storage industry faces
the challenge of building many technologies from scratch,
testing new integrations, and building new skillsets within
their workforce. Until very recently, energy storage did not
form part of an engineering degree and as such recruiting
experienced employees can sometimes be a challenge.
40% of respondents from the storage industry revealed
that a lack of digital skills was a barrier to digitalization in
their company and 39% cited lack of digital mindset as
a barrier. It’s unsurprising then that our research reveals
unanimous recognition that digital skills training is
needed, with 90% of participants regarding it fundamental
for their organization to invest in. When questioned about
which skillset would be most important for the storage
indusry to have in its workforce, the following three stood
out as priorities:

The following skills are priorities for the energy storage industry

Data science including Creativity including creative Cyber security

artificial intelligence and problem solving & application
machine learning of digital technology
43% 35% 32%

2
Is there a near-term market for vehicle-to-grid electric vehicles? Michael K. Hidrue and George R. Parsons
 DIGITALIZATION AND THE FUTURE OF ENERGY STORAGE 07

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THE TECHNOLOGY BARRIERS TO
DIGITALIZATION IN THE ENERGY
STORAGE SECTOR
As well as lack of skills, our survey also uncovered and use cases prove their value. Thirty four percent
technology and cyber security as additional barriers to of respondents also noted that cyber security due to
digitalization. Thirty two percent of respondents revealed data sharing was a barrier. This highlights a need for
that uncertainty about technology was a barrier for industry standards and protocols to build confidence in
digitalization within their company. This finding should connecting technologies and sharing energy data.
decrease as technologies become more established

08
CONCLUSION
It’s clear that storage has a significant role to play when
it comes to supporting the rise of renewable energy and
ultimately lowering our dependence on fossil fuels.
But it is important that the energy storage industry invests
in the future of its workforce, demonstrates the efficacy
of digital technologies, and finds new revenue streams to
extend the potential of storage assets across the energy
value-chain.
SAFER, SMARTER, GREENER

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Email: contact.energy@dnvgl.com
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