The energy storage industry is experiencing rapid growth, with batteries playing a critical role in the transition to a sustainable world. Despite the enormous promise of Battery Energy Storage Systems (BESSs), the industry faces a pressing problem: inconsistency in battery performance. Some BESSs promise more charge than they can deliver, while others lose their ability to charge to full capacity far too early in their lifespan. This inconsistency is causing storage operators to miss revenue expectations and utilities to temper their enthusiasm for this potentially game-changing resource—at least until it starts performing as expected.

While it may be tempting to blame the hardware, the real culprit often lies with the software. Energy Management System (EMS) software, which manages energy flows between batteries and the grid, has largely relied on inaccurate state-of-charge information, lacking both features and usage strategies that could otherwise improve performance, reliability and ROI. As Yann Brandt, Chief Commercial Officer at EMS provider FlexGen, explains: “Ultimately, the question of whether batteries will become a bigger part of our energy future is inherently dependent on software and analytics. That’s really where the future of energy storage at scale needs to be focused, because batteries themselves always work — the hardware itself works — but turning them on and off when you want them to is a software problem.”

The solution lies in advanced EMS that goes beyond inefficiently meeting immediate market demand based on inaccurate state-of-charge information. Brandt shares that the biggest software and operational needs revolve around improved performance analytics and using advanced EMS to reliably respond to exceptional network conditions. Future innovations will further unlock the power of storage.

Above all, the importance of real-time performance data — including state-of-charge down to individual cells — cannot be overstated. Inaccurate measurements can result in storage owners losing revenue or facing significant penalties for not delivering promised energy to the grid. During the development of their

Using the advanced EMS application HybridOS Analyze, the FlexGen team tested dozens of systems; they found that even new batteries exhibited up to 20% inaccuracy in charge information, with some arrays operating at only half their rated capacity due to energy bottlenecks caused by failed cells. With the potential for tens of millions of dollars in lost revenue or penalties, Brandt estimates the cumulative hit to the storage industry at billions of dollars annually. And concerns about missed commitments lead to reduced investment by utilities and less favorable contracts for independent power producers (IPPs) — driving less investment in IPP BESSs.

Advanced EMS addresses this problem by providing real-time data and actionable insights. Storage owners who fully understand the battery health and state of charge of their systems can accurately commit to meeting the needs of the energy market, maximizing benefits. And owners who cycle systems ahead of high-demand, high-revenue months can perform preventative maintenance on failed cells, ensuring performance when it’s needed most.

Other advanced EMS components are making BESS resources increasingly reliable in a changing climate. Take the example of Winter Storm Uri, which hit Texas in February 2021 with temperatures cold enough to render inactive BESSs inoperable. A case study highlighted how one BESS operator with multiple sites simultaneously charged and discharged systems during Uri: the strategic flows of electrons enabled by advanced EMS cost nothing on the wholesale market but kept the BESS facilities warm enough to achieve 99.7% uptime during the 5-day event. As a result, the operator generated significantly more revenue than its competitors while supporting a strained grid and struggling customers.

The benefits of advanced EMS extend beyond individual BESS operators. By helping operators maximize revenues and avoid penalties, these platforms will drive storage investments that make the grid more efficient and sustainable. Utilities will become more comfortable with the technology as batteries consistently reach their theoretical potential, leading to greater adoption by both utilities and IPPs. “At a high level, what the grid operators want, what the utilities want, is for the batteries to do what they say they can do – what they were supposed to do when they bought them,” Brandt says.

In conclusion, advanced EMS and analytics are the key to unlocking the full potential of energy storage. By providing real-time data on battery performance and state of charge, strategically managing energy flows, and more, these increasingly sophisticated platforms enable storage owners to optimize operations, maximize revenue, and avoid costly penalties. As the industry embraces these solutions, utilities will gain greater confidence in the technology, leading to increased investment and a more efficient, sustainable grid that benefits everyone. The future of utility-scale storage is bright—and it’s being driven by advanced EMS.