Post: Powering the grid of tomorrow: a conversation with Gore Street Capital

Powering the grid of tomorrow: a conversation with Gore Street Capital

In the second episode of the Energy Trends podcast, GridBeyond’s VP of Business Development Alden Phinney was joined by guest Thomas Gilles, Commercial Manager at Gore Street Capital to discuss the evolving world of battery energy storage. In this article we summarise the discussions.

Battery energy storage systems (BESS) are increasingly playing a “fundamental role in decarbonization, really plugging in that gap of intermittency that is being left behind by aging gas and coal fleets, for example, but also the increased amount of renewables”.

In early markets like the UK, batteries were initially used for fast frequency response services. But, according to Gilles, “wherever the grid is becoming more renewable, batteries are stepping in to handle intermittency and provide reliability”, as a result batteries are now deeply embedded in trading, peak shifting, and grid balancing roles.

In nearly every market Gore Street Capital operates in, the revenue mix for BESS is shifting away from ancillary services toward wholesale energy trading. In ERCOT, battery revenue from ancillaries dropped from over 95% in 2022 to under 50% in 2024. “The ancillary markets get crowded quickly,” Gilles notes. Battery buildout leads to overcrowding, and because BESS are so they outcompete traditional price setting forms of generation leading to price decreases. This has made trading skill sets and price forecasting increasingly essential. Batteries must be nimble enough to capitalize on fleeting price spikes, especially in volatile markets.

But “batteries can do so much more than they’re allowed to today, synthetic inertia, black start, reactive power. The tech is ready, but the markets aren’t. Unlocking that potential is our biggest challenge, and opportunity.”

How long a battery can deliver power is becoming a defining metric for project value. While ERCOT has standardized around 2-hour systems, CAISO and PJM push for 4-hour durations due to their capacity accreditation rules. Some jurisdictions, like the UK, are now exploring 8-hour systems through government-backed procurements. In addition, each region has its own grid structure, regulatory environment, and market design, which heavily influences storage economics.

In ERCOT, nodal pricing has created dramatic differences in battery profitability depending on location. “We have three sites within two hours’ drive of each other,” Gilles explained, “and yet they have completely different revenue profiles because of how they sit in relation to local grid constraints.” Meanwhile, in the UK, upcoming regulatory reform under REMA (Review of Electricity Market Arrangements) may shift from national to zonal pricing (please note that REMA has now been determined following the recording of the podcast and there will not be a shift), which would significantly impact battery site selection and operations. “It’s a game of reading signals […] developers must interpret where they can add the most value and capture it.”

With increasing complexity in grid dynamics, optimization and forecasting have become the heartbeat of battery project success.

As batteries grow in sophistication, so does the demand for smarter monitoring and analytics. Asset management platforms that can track state of charge, temperature thresholds, and degradation rates are becoming indispensable. “The market is just beginning to harness the value of battery data […] the next step is using it not just to protect assets, but to enhance performance.”

“No one can optimize 100% of the time,” Gilles admits. “But being able to forecast volatility, manage state of charge, and adapt to unique site constraints is what separates the best from the rest.”

Stay tuned for more episodes of the Energy Trends podcast from GridBeyond, where we continue to explore the frontiers of clean, flexible, and resilient energy systems.