In this exclusive op-ed for The Manufacturer, ABB Electrification Service’s Lee Todd explores how a new service model enables manufacturers to take advantage of Battery Energy Storage Systems (BESS) without the associated capital investment, technical complexity and obsolescence risk.
Manufacturing lies at the heart of Europe’s industrial identity and future prosperity. As the sector faces mounting pressure to decarbonise, the 2025 European Union’s €100bn Clean Industrial Deal represents an unprecedented commitment to supporting this transition. This initiative not only builds upon the 2019 Green Deal’s foundation but also addresses economic resilience by incentivising local manufacturing to reduce geopolitical and economic risks. Yet beneath the ambitious targets and funding promises lies a fundamental challenge that threatens to undermine these efforts: the mismatch between how energy is produced and how it’s consumed in manufacturing.
The truth about renewable energy is that it operates on nature’s schedule and not the production line’s. Solar generation peaks at midday, but manufacturing often is required to run 24/7. Wind power fluctuates seasonally while production demands remain constant. There is a fundamental mismatch between what we expect from a clean energy supply and what manufacturers require: while renewable energy is inherently intermittent, manufacturing demands reliable, continuous power.
This disconnect creates a critical gap in the bloc’s industrial decarbonisation strategy. The true cost of this intermittency is rarely discussed in policy circles, yet it quietly reshapes the economics and competitiveness of manufacturing’s clean energy transition.
The intermittency premium
I’ll paint you a picture: should a steel mill pause operations when clouds block the sun? This question brings to the fore why Battery Energy Storage Systems (BESS) are becoming critical for European manufacturers seeking both sustainability and competitiveness.
The Clean Industrial Deal recognises this challenge by setting electrification as a key pillar for industrial decarbonisation, with a 32% target by 2030. The scale of this undertakingis evidenced by the explosive growth in the global energy storage market. According to the World Economic Forum, energy storage capacity is expected to grow six-fold to more than 2 TWh by 2030, with annual deployments increasing by an average of 21% per year.
For manufacturers increasing their renewable energy procurement to meet sustainability goals, this intermittency premium grows exponentially. The traditional solution is purchasing and then maintaining battery energy storage systems, but it introduces new challenges for manufacturers whose expertise lies in making products, not managing complex energy assets. Capital competition means every Euro spent on energy infrastructure is diverted from core innovation. Add on top of that the complexity of implementation barriers, and we find manufacturers facing an impossible choice between sustainability goals and competitive advantage.
Turning business models upside down
This seemingly impossible choice, however, is based on an outdated assumption: that manufacturers must own and operate their energy assets. What if we challenged this fundamental premise? The solution lies not in new battery technology, but in a fundamentally different approach to deploying it. Battery Energy Storage System-as-a-Service (BESSaaS) eliminates the capital investment, technical complexity and obsolescence risk that have prevented widespread adoption of energy storage in the manufacturing sector.
This service model transforms energy storage from a product to be purchased into a service to be consumed, complementing manufacturing’s core focus on operational efficiency rather than energy asset management. By eliminating upfront costs, it converts what would be a significant capital expenditure into a predictable operating expense.
Unlike traditional capital investments, service-based energy storage offers scalability and flexibility that fixed assets cannot match. Manufacturers can start small, demonstrate success and expand as needed, adapting to changing business conditions without being burdened by stranded assets. This flexibility is particularly valuable in today’s uncertain economic climate, where agility determines competitive advantage.
The reimagination of energy in manufacturing
Slashing the intermittency premium is just the start. BESSaaS unleashes a host of strategic advantages for manufacturers caught in Europe’s energy transformation. It eliminates significant capital outlays while introducing predictable operational expenses. This strategic approach makes advanced energy storage accessible to businesses of all sizes, delivering the resilience, cost efficiencies and sustainability that today’s competitive landscape demands.
The real revolution lies in transforming energy infrastructure from a cost centre into a revenue-generating asset. Manufacturers can now not only consume energy but actively participate in energy trading, sell excess power back to the grid under favourable feed-in tariff schemes (particularly in European markets like Germany and the UK), provide grid stabilisation services and access capacity markets without the technical complexities or financial burdens of traditional systems. When renewable energy fluctuates — as it inevitably will – BESSaaS smoothens these variations, ensuring production lines continue operating regardless of weather conditions. During grid failures, these systems maintain operations while competitors face shutdowns, eliminating both production losses and the need for carbon-intensive diesel backup generators.
Concerns about long-term commitments or relinquishing control of critical infrastructure are addressed through BESSaaS solutions. These come with transparent agreements backed by service guarantees and robust cybersecurity measures. Manufacturers maintain control while transferring technical risks to specialists with deep expertise in energy management.
In the broader EU Green Deal landscape, battery storage serves as the critical link between variable renewable generation and the non-negotiable requirement for reliable power in manufacturing. The European Battery Alliance recognises that without extensive storage deployment, Europe’s ambitious 42.5% renewable target for 2030 cannot be achieved. BESSaaS has the potential to remove adoption barriers, accelerating Europe’s climate goals while aligning perfectly with the objectives of the European Commission’s €100bn Clean Industrial Deal to support EU-made clean manufacturing.
Aligning with European industrial strategy
The Clean Industrial Deal identifies “access to affordable energy” as a cornerstone for energy-intensive sectors requiring urgent decarbonisation support. Service-based storage directly addresses this need by optimising energy costs and enhancing resilience without diverting capital from manufacturing priorities, while facilitating the Deal’s aim to create “lead markets for European clean technologies.”
For European manufacturers navigating the Clean Industrial Deal, BESSaaS offers the pragmatic path forward that’s been missing. It flips the script on intermittency, transforming what was once a barrier into a competitive advantage. Manufacturers can now embrace renewable energy without the traditional trade-offs between sustainability goals and operational performance. The result? Decarbonisation without compromise.
As we accelerate toward industrial decarbonisation, addressing the hidden cost of intermittency through innovative service models will be essential to maintain European manufacturing competitiveness. The path to net zero doesn’t require manufacturers to become energy experts, it just requires them to embrace new models that match environmental imperatives with business realities. I encourage manufacturing leaders to consider this opportunity critically: assess your energy profile to quantify the real impact of intermittency on your operations and explore whether service-based storage solutions could bridge the gap in your decarbonisation strategy.
The path forward requires thoughtful evaluation of new business models that align environmental imperatives with manufacturing realities. Understanding your specific intermittency premium is the first practical step toward addressing this hidden cost while maintaining competitiveness in Europe’s evolving industrial landscape.
About the author
Lee Todd is the global business leader for Sustainability Advisory Services at ABB Electrification Service.
Sustainability Advisory Services is the newest offering within Electrification Service, drawing on the organization’s long-standing expertise to bring reliability, safety and cyber security to its suite of end-to-end sustainability solutions. Lee is responsible for leading this new segment of the business, driving global advisory engagements and guiding customers through the complexities of their path to net zero, beginning with data collection and baselining.
He brings more than 30 years of electrical distribution and systems expertise to ABB. Prior to his current role, he served as the Executive Global Product Manager for Service Solutions. Before joining ABB, Lee held several roles with General Electric Industrial Solutions, where he focused on product commercialization and industrial solutions. He also held several roles at NORWEB PLC, where he progressed to becoming the Commercial Manager for major projects.
For more articles like this, visit our Leadership channel
