Grid connection wait times are historically long, and what that means for those who act now

Access to the electricity grid has traditionally been treated as a standard service that mainly required an administrative order. As industry and transport electrify at scale, that reality has changed. Grid capacity is now a limited resource, and wait times for a grid connection can therefore be markedly longer than only a few years ago.

For industrial companies, this means that timelines for expansions, new production lines, or charging infrastructure are to a large extent set by what the grid can deliver. This article explains the underlying drivers of pressure on the grid, and how companies in some cases can use an industrial BESS (Battery Energy Storage System) to make better use of their existing grid connection while they await a possible upgrade.

If you want to assess whether a BESS can ease wait time or capacity constraints in a specific installation, you can contact Zynex Group here: https://zynexgroup.com/da/contact.

How wait times on the electricity grid have developed

Physical expansion of the electricity grid is struggling to keep pace with rising demand for capacity. The most recently published aggregate figures show that connection times in the electricity grid have risen markedly over a period of years. Forsyningstilsynet, Denmark's utility regulator, publishes these figures for the distribution network companies.

An official overview documents that the average connection time more than doubled from 20 to 43 days in the period from 2017 to 2022, while the median rose from 6 to 12 days. These figures cover all types of connections, and the trend shows generally rising pressure on the grid connection process.

Wait times have grown as more customers seek connection, and as individual cases have become more complex. This is not only an administrative backlog. It reflects that the physical infrastructure is under substantial pressure in many places.

What is driving the pressure on capacity?

When a company requests a larger grid connection, the local distribution network company must assess whether there is enough room in cables and transformers to handle the extra power. If the capacity is not available, the grid must be expanded.

In practice, such an expansion can include sizing, procurement of relevant components, obtaining permits, and the construction work itself, but the concrete process and sequence vary between projects and network companies.

The authorities point out that faster connection supports an effective green transition, and work is under way to optimise the processes. The physical reality, however, is that expanding heavy infrastructure takes time.

The competitive advantage of using existing capacity

When capacity is scarce, timing and access to the grid become a decisive competitive parameter. Companies that already have an established grid connection hold a valuable asset. The question is how that asset is used as effectively as possible.

In some industrial facilities, consumption may be concentrated in certain periods of the day, for example at the start-up of heavy machinery or during production peaks. In such cases there can be spare capacity in the existing connection at other times.

By installing an industrial BESS behind the company's own meter, some of this spare capacity can in some cases be used. The battery can be charged in periods when the company's consumption is low, and deliver power during shorter peak periods. This method is called peak shaving. In some cases it can postpone or reduce the need for an expansion of the grid connection.

Alternatives to full grid expansion

To address wait-time challenges, system operators and authorities have introduced some flexible connection models. It is possible to work with temporary and staged connections under specific schemes, which can shorten the time to operation until the final grid expansion is in place. Energinet is Denmark's national transmission system operator and describes these options in its planning material.

There are also schemes for limited grid access, where installations can be connected more quickly in exchange for accepting terms on interruptibility or downward regulation in peak-load situations. The authorities have likewise approved specific trials with faster connection, where parties accept limitations in order to reach operation sooner.

These models often rest on a priority logic. Temporarily available capacity can in certain cases be allocated on a first-come, first-served basis. That means parties that are ready to integrate flexible solutions such as a BESS can in some cases obtain faster, but conditional, grid access than those waiting for a traditional, unrestricted grid connection.

Opportunity cost: What does 18 months of waiting cost?

When a company considers postponing an investment in order to await a grid expansion, it is relevant to calculate the opportunity cost of waiting. In a hypothetical scenario where an upgrade of the grid connection takes 18 months, the period will typically mean deferred revenue and deferred operating savings.

An industrial BESS can in some cases create value from the day it is put into operation. Electricity market prices reflect the ongoing balance between supply and demand, and electricity prices vary hour by hour in the day-ahead market. A battery system can in some cases make it possible to buy power when the price is low and use it from the battery when the price on the grid is high.

At the same time, price developments are monitored closely, and official statistics continuously show how electricity prices are evolving. Companies that own their own storage capacity can in some cases use these price swings. By waiting for a grid expansion, the company can therefore in concrete scenarios lose the opportunity to reduce tariff payments through peak shaving and to shift consumption to cheaper hours. The economic consequence depends on the consumption pattern, price levels, the concrete wait time, and local operating assumptions.

Outlook toward 2027

To create transparency for market participants, grid development plans are published on an ongoing basis. These describe the expected investments for the coming 5 to 10 years.

These long time horizons underline that capacity challenges will not disappear in the short term. Even as the grid is expanded, electrification of society will continue to claim the new capacity. Grid access will remain a strategic resource, and the ability to operate flexibly within an existing connection will continue to be an economic advantage.

Limitations and assumptions

A BESS is an effective solution for handling peak loads and shifting energy consumption in time, but it is not a universal solution for every capacity problem.

• Constantly high consumption: If a company plans an expansion that requires massive, constant power consumption around the clock, a battery will eventually run out of energy. A battery delivers power and stores a defined amount of energy, but it does not produce new energy.
• Space requirements: An industrial installation requires physical space on the site, as well as compliance with applicable setback distances and safety rules.
• Existing capacity: The solution assumes that there is actually spare capacity in the existing grid connection at certain times of day, when the battery can be charged.

If the company's base load permanently exceeds the existing grid connection, a physical expansion of the electricity grid is unavoidable, and a battery can in that case only function as a partial solution. For companies that want to assess their options for faster operation or more flexible capacity use, the relevant solution depends on the concrete consumption pattern, the existing grid connection, and local capacity conditions.