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The transformation of the power system toward renewable energy production increases the need for flexibility and balancing solutions. Battery storage has become a central part of this whole, as it enables electricity to be stored and used at different points in time to balance variations in production and consumption.
At a large scale, battery storage is primarily utilized in electricity markets, such as for frequency regulation and reserve markets. In the Nordic power system, battery storage can contribute to stabilizing the power grid at a regional level, meaning their impact extends across national borders. In this context, market integration and the ability to utilize storage at times when it provides the greatest benefit to the overall system are of key importance.
At the local level, the role of battery storage is emphasized in distribution networks. They can, for example, reduce peak loads in the grid, defer investment needs, and enable more flexible use of the power network. The importance of local solutions increases especially in areas where the share of renewable generation is growing rapidly or where consumption peaks are difficult to manage.
By 2040, the question will no longer be “how much energy can be produced and transmitted,” but how the energy that is produced can be delivered to end users at the right time.
The focus of the power system is shifting from energy to flexibility.
By 2040, the question will no longer be “how much energy can be produced and transmitted,” but how the energy that is produced can be delivered to end users at the right time. However, reinforcement of the power grids will by no means be pushed into the background—on the contrary, development is progressing rapidly. Today’s grid development needs assessments are often based on scenarios in which electricity consumption in the Nordic region could roughly double by 2040. As the focus of generation increasingly shifts toward solar and wind power, power grids will need to become significantly more dynamic. Together with continued electrification of industry, transport, and heating, this creates a complex and challenging development environment.
Traditionally, electricity generation in the Nordic power system has been highly predictable and easy to regulate. As the share of renewable energy increases, however, the system requires more flexibility elements. Flexibility will be needed on both short and long time scales: down to fractions of a second to maintain grid stability, and at the other extreme on a weekly scale when the gap between produced and consumed energy is larger.
The power system will require comprehensive flexibility elements that can maintain the balance between production and consumption at all times. Both energy and power are needed for the system as a whole to function. Battery storage holds a particularly advantageous position here, as from the grid’s perspective it can act as both a consumer and a producer, and its response capability is extremely fast.
Battery storage makes the grid faster, more local, and more controllable.
Battery storage is not just about storing electricity; it is a fast‑acting asset in the power system. Its value goes beyond capacity to include location, control reliability, and system performance. Located near local grid constraints, battery storage strengthens distribution networks and mitigates demand peaks even when power is abundant nationally.
The long-term value of battery storage therefore does not lie solely in “charging cheaply and discharging at a high price”; they also have strategic value by being able to operate in multiple roles, both locally and nationally—with functions extending across the entire Nordic power grid. As a result, battery storage will not merely be part of the future power system, but a core component of it.
The future Nordic power grid will therefore not be based on a single specific flexibility model; instead, different elements together with the grid will form an integrated whole. The best overall solution emerges when all components work together in a technically and cost‑effective way.
Battery storage as part of a larger flexibility system
The main drawback of battery solutions is the cost level of energy capacity. For this reason, they cannot be the only flexibility element in the power grid for long-term, large-scale flexibility. Demand-side flexibility, thermal storage, electric vehicles, and hydrogen production, together with flexible industrial solutions, form an integrated whole. All of these solutions have their own strengths depending on the required response time, energy capacity, location, and cost level.
Battery solutions are at their best for fast and short-term needs. Demand-side flexibility, in turn, is helpful when balancing is required within the day. Thermal storage can contribute to balancing over longer time scales, meaning that energy is stored when production exceeds consumption and discharged when production is lower than consumption. These solutions will naturally play a particularly important role in addressing balance challenges during the coldest seasons. Hydrogen solutions or other solutions that store energy in liquid form may be the answer for balancing over even longer periods.
Finland’s future power grid will therefore not rely on a single specific flexibility model; instead, different elements together with the grid will form an integrated whole. The best overall solution emerges when all components work together in a technically and cost-effective manner.