The Development of Large-Scale BESS in Sweden A Technology Monitoring Analysis of Trends, Drivers, and Barriers

Sammanfattning

The rapid transition of the Swedish power system, driven by electrification and anincreasing share of variable renewable energy, has created the need for flexibilityresources. This has led to a significant expansion of large-scale Battery EnergyStorage Systems (BESS). The aim of this thesis is to map the current BESS marketlandscape in Sweden and to analyze the underlying drivers, structural barriers, andfuture trajectories.The study applies a mixed-methods approach, combining a quantitative mappingof Swedish BESS projects exceeding 1 MW with a qualitative analysis based on 19semi-structured interviews with key industry actors, including project developers,system operators (DSO/TSO) and authorities. The findings are interpreted usingthree complementary theoretical lenses, the Technology Life Cycle and S-curve, theMulti-Level Perspective, and the Technological Innovation System framework, appliedas conceptual tools rather than as a structuring framework.The results show that the market has grown rapidly to approximately 1,3 GW ofconfirmed operational capacity, initially driven by exceptional profitability in theFCR-D ancillary service market. Following its saturation, the market has recalibratedtoward mFRR participation, energy arbitrage, and value-stacking acrossmultiple revenue streams. New application niches are also emerging in co-locationwith renewables, industrial peak shaving, and local grid flexibility, alongside a technicalshift toward longer storage durations.The key barriers identified are predominantly institutional: regulatory ambiguityaround BESS classification, a fragmented DSO landscape with inconsistent standards,opaque grid connection processes, and a misalignment between commercialincentives and broader systemic value. These constitute blocking mechanisms slowingthe market’s transition into a full growth phase. The thesis concludes thatthe future trajectory of Swedish BESS depends less on technical readiness than onwhether the institutional landscape can adapt to match the pace and direction ofmarket development.