Maximizing Battery Value in Volatile Energy Markets: A Strategic Guide

Ian Connor
May 22, 2024By Ian Connor

The Australian energy market is notoriously unpredictable, with prices that can swing wildly. This volatility can be a double-edged sword for those with energy storage solutions like battery systems. Traditional energy export strategies often rely on averaging prices over a period, such as half an hour, which can lead to missed opportunities and diminished returns. However, a well-informed and strategic approach can transform these fluctuations from a hazard into a high-reward opportunity.

Consider a recent evening in Queensland's energy market: prices started at a mere 12c/kWh and soared to an incredible 1,420c/kWh by the end of a half-hour window. Managing a battery system under these conditions requires foresight and precision. One such battery, under my management, exported just 25Wh at the low rate before switching to a real-time pricing model, LocalVolts, earlier in the month. When the price peaked, the battery exported 273Wh, earning $3.8 in just five minutes—a stark contrast to the another platform's averaged payout of $2.76 for the entire period.

Five Minute PriceThirty Minute Price

This change in the last few periods is not uncommon and leaves users who watch the predictions confused as they swing wildly trying to estimate average. 

But beyond the strategic choice of when to export lies another critical factor: the speed of response. In the past week, my system's average response time to price signals was within 21 seconds, allowing the majority of the five-minute window to capitalize on the high prices. This rapid response is key, by comparision I know of another company that issued an SMS alert for that price spike two minutes before the end of a half-hour window. That was too late for customers. The damage was done to the energy bill in the previous 28 minutes, and there's little you can do to mitigate it.

This incident underscores two critical lessons: averaging hurts and speed is king. Averaging dilutes the potential earnings from spikes in energy prices and can lead to inefficient use of battery storage. And in the race against time, speed is critical. Why export energy at a low rate in the hope of a spike when you can conserve and deploy the battery's capacity precisely when the spike occurs? Timely reporting and the ability to switch inverters and loads within seconds are not just advantageous—they're essential for modern energy management.

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