Realizing Renewable Energy Storage Potential in Municipalities: Identifying the Factors that Matter

– The share of renewable energy in heat and power generation is expected to increase significantly and reach record levels in the coming decades. As a result, emerging energy storage technologies will be key elements in balancing the energy system. To compensate the variability and non-controllability of seasonally generated renewable energy (RES) (daily fluctuations in solar radiation intensity, wind speed, etc.) development of sufficient energy storage infrastructure in the regions will play a major role in transforming RES supply potential into reality. However, local public authorities that are responsible for creating an enabling policy environment for RES infrastructure development in regions encounter numerous challenges and uncertainties in deploying sufficient energy accumulation that often remain unanswered due to a lack of knowledge and on-site capacity, which in turn significantly hinders the regional path to climate neutrality. In this study, the PESLTE analytical framework and composite index methodology is applied to examine the multidimensional factors that influence the deployment of renewable energy storage technologies in municipalities: political, economic, social, legal, technological, and environmental. Developed model is approbated in a case study in a Latvian municipality where four different alternative energy storage technologies are compared: batteries for electricity storage, thermal energy storage, energy storage in a form of hydrogen, and energy storage in a form of biomethane.


INTRODUCTION
To incentivize the speed of decarbonization, strengthen energy independence by rapidly reducing EU's dependency of Russian fossil energy resources, EU's REPowerEU plan has declared to reach at least 45 % share of renewable energy in final consumption by 2030, which is more than a double from around 20 % renewables in 2019 [1], [2].In terms of electricity generation and supply, this means a major expansion of installed renewable energy capacities.It is estimated that by 2030 at least 50 % of electricity demand will be generated by renewable energy sources, up from a current share of approximately 30 % [3].The ambitious RES targets are also set for the heating and cooling sector where the EU's "Fit for 55" package set a target to increase the share of RES in heating and cooling at the national level by at least 0.8 % annually until 2026 and by 1.1 % from 2026 to 2030 [1].Most of this additional renewable energy supply will be generated from variable energy sources such as wind and solar energy, which will create significant challenges for the flexibility, security, and price volatility of the entire energy system, putting pressure on the long-term sustainability of the energy sector.Variability and non-controllability of seasonally generated renewable energy (fluctuations in solar radiation intensity, wind speed, etc.) in regions requires for more adaptive and flexible energy system infrastructure [4].Therefore, enhancing system flexibility and focusing on energy storage solutions will play a major role in transforming renewable energy supply potential into reality.
In the context of moving closer to a prosperous, modern, competitive net-zero greenhouse gas economy and reach Paris Agreement commitments EU developed a Long-Term strategy which analyses different scenarios to achieve 80 % to 100 % decarbonization levels by 2050 [5].The development pathways differ in level of electrification, utilization of hydrogen and power-to-X technologies (hydrogen, methane, other synthetic gases or liquids).Electrification and significant increase in electricity demand supported with high deployment of renewable energy generation (with high emphasis on solar PV, onshore and offshore wind power) is set out to be the key measure in all the analyzed future decarbonization pathways.Therefore, it is estimated that for future energy system that is highly dependent on RES, high penetration of storage capacities (at least six times larger than currently installed levels) is of primary importance to support the fluctuations of the renewable energy.Subsequently, more in-depth investigation is necessary to study transformational carbon-neutral technological solutions and identify which development pathway will bring the highest contribution to decarbonization of future energy system.Energy storage is highlighted as the key element to accelerate the speed of decarbonization in the European Union [6].
In terms of regional pathway towards green energy transition, municipalities play a key role to enable energy storage deployment in cities and regions.Over the past decade, the role of local public authorities in the national energy system has changed significantly.Whereas in the past local governments relied on general policies of national governments without actively participating in energy system planning, today municipalities have taken stronger institutional role and control over the governance of their local energy system [7].One of the reasons for the increasing proactive role of local public authorities is the shift from fossil fuels, which are mostly centralized, to renewable energy systems, which are decentralized.Because of the significant increase in decentralized energy systems in local jurisdictions, municipalities have more incentive to play a larger role in their overall energy sector in the region [7].
Although the overall development of national energy systems is influenced by national governments and energy supply companies, municipalities play an important role in shaping energy policy in many countries around the world through the privatization of local utilities [8].In the Nordic countries, there are a number of municipalities that have privatized their local energy suppliers and developed renewable energy generation facilities (hydropower, wind turbines, methane capture from wastewater, sludge, and landfills) [8].Another example is Germany, where local utility companies that are owned by municipalities have formed community-based energy cooperatives that have collective participation and responsibility in power generation and distribution in the region [8].
Municipalities take on a wide range of roles, from setting goals, planning, and regulating, to actively participating in the development process as operators, financiers, and facilitators, to being key awareness builders and demand aggregators for the system [8].Municipalities can play a key role in the future energy transition towards renewable energy sources since there are many opportunities for installing renewable energy (e.g., photovoltaic systems) on municipal land, such as on the roofs of public buildings, so municipalities could encourage their citizens to actively participate in the development of the energy system in the region.
Municipalities can also provide support through financial incentives (e.g., tax relief, grants) and setting requirements (e.g., awards) that encourage presumption.In addition, support should not only be financial, but also in the form of advice on renewable energy planning and development [8].
Variable energy requires the development of new and innovative energy storage technologies and alternative development pathways.However, local public authorities that are responsible for creating an enabling policy environment for RES infrastructure development in regions encounter numerous challenges and uncertainties in deploying sufficient energy accumulation that often remain unanswered due to a lack of knowledge and on-site capacity, which in turn significantly hinders the regional path to climate neutrality.This study aims to explore various factors influencing the deployment of renewable energy storage technologies in municipalities faced with the question of which direction to take and what infrastructure investments should be made to move closer to climate neutrality targets.
When investigating multiple factors and impact dimensions, there is a need for a framework that encompasses a broad perspective and incorporates all pertinent aspects without overlooking other essential factors.The PESTLE framework is one of the methods used to address this issue.A study by [9] uses PESTLE analysis approach to investigate the existing challenges in biofuels energy industry development in Europe.Using economic, environmental, socioecological, and geopolitical sustainability factors, the strengths and limitations of various biofuel production and deployment pathways were identified.In a study by [10] the fuzzy EDAS method is used in combination with the PESTLE analytical framework to analyse the efficiency of different renewable energy sources.The application of the method made it possible to rank different renewable energy sources according to their efficiency level, with geothermal and solar energy being ranked the strongest and hydropower the weakest.[11] uses mixed method approach which include PESTLE and SWOT analysis to identify the main factors impacting renewable energy development in Togo.Study finds that the primary obstacles to the implementation of renewable energy in Togo are the limited accessibility of capital, inadequate political support, insufficient infrastructure, and inadequate levels of awareness and education.Literature analysis revealed that PESTLE analysis approach is also used to study waste-to-energy incineration industry [12] and global wind energy deployment [13].To date, there has been no scientific research examining the use of the PESTLE framework as a means to analyze potential opportunities for energy storage development in municipality settings.
This study applies an innovative model that integrates both quantitative and qualitative assessment methods.The PESTLE analytical framework combined with a composite index methodology is used to compare four different alternative energy storage technologies: 1. Lithium-ion batteries; 2. Water-based sensible thermal storage; 3. Power-to-gas (hydrogen); 4. Power-to-liquid (biomethane).In the scope of this study, the developed model is approbated in a case study in a Latvian municipality.

General Description of the Methodology
The main objective of this study was to evaluate and compare the potential deployment of four different renewable energy storage technologies in a municipal energy system -batteries for electricity storage, thermal energy storage, energy storage in a form of hydrogen, and energy storage in a form of biomethane.In order to consider and analyse the various factors that influence the development of the energy system in a municipality a multilevel assessment model was created.The methodological framework of this study was based on a combination of PESTLE analysis and composite index methods, using both a quantitative and qualitative assessment approach for data collection of PESTLE indicators.Fig. 1 illustrates the general framework of the research approach.Developed model of this study was approbated in a case study in a Latvian municipality located in Gulbene.PESLTE analysis is a framework used to evaluate multidimensional factors affecting complex systems, specific industries, organizations, or products.Each letter of PESTLE framework encrypts the first letter of the factor included in the analysis -P-political, Eeconomic, S-social, T-technological, L-legal, E-environmental [9], [14].This study applied the PESTLE framework to select and analyse relevant factors that influence the deployment of different renewable energy storage technologies in a municipal context.To compare technologies based on the PESTLE analysis indicators, the composite index method was applied to quantify and measure the influencing factors for each technology.
The quantitative assessment included the collection of data on key performance and sustainability indicators for each energy storage technology.To narrow the scope of the research, lithium-ion batteries were selected from the available different types of different technologies for electricity storage, sensible thermal energy storage technologies were selected for thermal energy storage, and more specifically, hot water tanks were selected in the PESLTE analysis.For hydrogen and biomethane storage, it is assumed that only renewable energy is used in the power-to-gas and power-to-biomethane conversion process.
Survey to municipality representatives was applied to assess different PESTLE indicators from the perspective of municipality.In addition, a qualitative assessment method was used, Environmental and Climate Technologies ____________________________________________________________________________ 2023 / 27 including both a literature review and interviews with municipality representatives, to strengthen the importance of social, political, and legal indicators in the PESLTE analysis, which are often difficult to quantify.
The steps of the research process in this study are shown in Fig. 2. The overall research methodology consisted of a six-step process.First, a literature was conducted, based on which relevant PESTLE indicators were selected and grouped into six main dimensions -political, economic, social, technological, legal and environmental.Then, data were collected for all the determined PESLTE indicators.Furthermore, the data were processed and used for the construction of composite index.Finally, conclusions and recommendations were determined based on the results of the composite index.

Selection and Data Collection on PESTLE Indicators
PESTLE the indicators were selected based on the findings from the literature review on the deployment of renewable energy storage technologies in municipalities and on the availability of data for all four selected alternative technologies.Table 1 shows the selected indicators grouped by their representative PESLTE dimensions.
Data collection on selected indicators was organized in two levels.First level included data collection on technology performance and sustainability parameters.Data were collected from scientific literature [15]- [19] and technology databases such as the European Commission's Energy Storage Database [20], the Danish Energy Agency's Outlook on Energy Storage Technologies [21], technology reports from IRENA [22], [23], technology reports from the European Association for Storage of Energy [24], and other technology outlooks [25].For several indicators such as CAPEX, OPEX, round-trip efficiency, and environmental impact, the data found in the literature and technology datasets included a value that had a data range.In this study, the mean values of the specified data range were used.In the context of thermal energy, the term 'round-trip efficiency' refers to efficiency.For the qualitative indicators, assessment scale was used to quantify the indicators comparing the different technologies.The assessment scale was specified and defined for each qualitative indicator as shown in Table 1.The second level included data collection from surveys and interviews with municipality representatives.The data obtained from the surveys and interviews allowed the study to include the perspective of the regional public authority when analyzing the various technologies.

Survey and Interviews with Municipality Representatives
In this study, a mixed design of interview and survey method was used.First, a questionnaire was designed with predetermined questions, which were then discussed and completed with the interviewer during the interviews with municipality representatives.

Environmental and Climate Technologies ____________________________________________________________________________ 2023 / 27
The questionnaire was sent to respondents prior to the scheduled interview date so that respondents had the opportunity to familiarise themselves with the topics and questions to be discussed.Five representatives of the Gulbene municipality in Latvia were surveyed and interviewed.The following municipality representatives were interviewed and surveyed: senior project manager of the Gulbene Municipality Development and Procurement Department, energy manager of the Gulbene District Municipality, advisor to the chairman of the Gulbene Region Municipality on development, projects and construction, senior project manager of the Gulbene Region Municipality, architect of the Gulbene Region Municipality Construction Department.A total of five interviews were conducted and transcribed.The interviews took place in person in March 2023 in Gulbene.Each interview lasted approximately 30 minutes to 1 hour.Gulbene would need to be modified to integrate the specific storage technologies?− In your opinion, would there be an available area and a suitable place on the territory of the municipality to place equipment that would not particularly affect the environment?− How difficult do you think it would be to get an environmental impact assessment and a permit for certain technologies?− How difficult do you think it would be to obtain approval to implement a particular development direction, and what would be the bureaucratic burden on the municipality and local authorities?
The following two open ended questions assessing barriers and drivers were asked at the end of the interview: − In your opinion, what are other barriers to the deployment of renewable energy storage technologies in the municipality, which may not have been mentioned in the survey?− What else do you think would be necessary to successfully move forward with the implementation of one of these development projects?Finally, the questionnaire asked respondents to evaluate the impact of all six PESTLE factors where the average results were further used in the weight assessment of indicators during the construction of composite index.

Construction of PESTLE Composite Index
The values of the PESTLE indicators from Table 1 were used as input data for the calculation of the composite index.The overall construction of the composite index consists of four main steps: 1. Indicator impact assessment; 2. Indicator normalization; 3. Weight assessment; 4. Aggregation.The procedure and equations for the calculation of the composite index were retrieved from studies by [28]- [30] and adjusted for this specific research.
Indicators are assessed according to their impact on promoting more active deployment of renewable energy storage technologies in the region.Indicators can have either positive or negative impacts.The general rule of thumb for evaluating impact is to consider whether or not an increasing value of a particular indicator would be beneficial to the low-carbon energy system as a whole.For example, greater government policy initiative and support for a particular technology would promote its diffusion, which is why this indicator is considered to have a positive impact.On the other hand, higher initial capital expenditures (CAPEX) would impose some burden on technology deployment, and an increasing CAPEX value would have a negative impact on diffusion.Table 1 summarizes all impacts for each indicator.
After all indicators have been evaluated for their impact on potential technology deployment in the municipality, all indicators are further normalized.The min-max normalization technique is applied to all indicators.The normalization calculation is performed for either indicators with positive or negative impacts.For indicators with positive impact, normalization is performed according to Eq. ( 1), and for indicators with negative impact, normalization is performed according to Eq. ( 2).After indicator data normalization, indicator weights were applied.Indicator weights were applied at two levels.At the first level, sub-indices were calculated for each dimension, using equal weighting technique for the indicators in each dimension.Each PESTLE dimension sub-index was calculated using Eq.(3).Once the values of the individual sub-indices of the dimensions were obtained, the subindices were aggregated to form the PESLTE composite index.Expert weights were used to calculate PESTLE composite index expert weights were applied.The values of the weights for each dimension of PESTLE were obtained from the surveys with municipality representatives.Table 2 summarizes the values obtained.The average values were used as weights for each dimension of PESTLE in constructing the composite index.PESTLE composite index was calculated by aggregating the individual sub-indices and applying the respective weight, according to Eq. ( 4).
where CI is final PESTLE composite index, w is the value of determined weight of a dimension.

PESTLE Composite Index Results
The results first represent the values of the subindices of the dimensions (see Fig. 3).Then, the results of the sub-indices were combined into PESTLE composite index which is illustrated in Fig. 4. The results of the individual dimensions are explained in detail below, followed by the analysis of the combined results of PESTLE composite index.Political dimension sub-index results show that thermal energy storage outperforms the other technologies, followed closely by batteries.Thermal storage scores much higher due to direct municipal priorities and the need to store thermal energy.Since municipalities have less control over the electricity system, they do not feel the benefits of batteries as strongly as those of thermal storage.There is no strong support from municipality representatives towards the potential use of hydrogen and biomethane because the main heat source in the municipality is biomass, not natural gas.In addition, municipality representatives acknowledge that there are currently more government initiatives and support for the integration of thermal energy storage and batteries.There are no strong national policies and regulations focused on supporting and accelerating the development of biomethane and hydrogen storage infrastructure, which is reflected in the results of the political dimension sub-index.At the international level, batteries have stronger policy targets in the EU to support rapid deployment, while thermal energy storage is given less priority compared to batteries.For thermal energy storage, priorities depend more on national governments and their visions.Hydrogen deployment is also highly prioritized at the EU level, while biomethane is less frequently prioritized and there is no strong and focused policy vision.
The results of the economic dimension sub-index show that thermal energy storage and batteries for electricity storage are currently the most cost-effective solutions compared to biomethane and hydrogen.Both initial specific capital investment (EUR/kW) and operation and maintenance costs (EUR/kWh) for thermal energy storage and batteries are significantly lower than for hydrogen and biomethane, which require high investments in infrastructure development and integration into existing energy systems.The capital availability of municipal co-funding for batteries and thermal energy storage solutions is significantly higher due to lower specific investment costs and a reasonable payback period that justifies the economic viability of the technology.
The results of social dimension sub-index show that both overall public attitude and knowledge and knowledge of the municipality representatives about technology is considerably higher for batteries and thermal energy storage than for hydrogen and biomethane.This is due to the fact that municipalities are generally more familiar with these technologies, as small-scale energy storage solutions for electricity and thermal energy are already installed in the region.Municipal representatives acknowledge that there is still much that is unknown about the optimal performance of these technologies and understanding of their benefits, but as they gain experience, they will become more proficient in their understanding and utilize these technologies.
On the other hand, hydrogen and biomethane technologies are less and municipality representatives have very limited knowledge about these new emerging technologies.Due to the lack of knowledge, the municipality representatives are skeptical about these solutions, as there are no real examples of best practices in other Latvian municipalities yet, and no basis and certainty has been established for the potential benefits of these solutions.
In general, public attitudes and knowledge about batteries and thermal energy storage tend to be positive, especially now that electricity prices have risen extremely, and the importance of energy self-sufficiency has been elevated nationally due to the global geopolitical situation.In general, people base their overall attitude on familiarity with technology.There are several small-scale thermal energy storage solutions installed in the municipal boiler houses, and people have a positive attitude toward it because they understand the benefits.Public understanding and acceptance of solar batteries has grown recently because of the examples already installed in the region, which are used to justify the investment and explain the benefits to the general public.However, for hydrogen and biomethane, attitudes tend to be negative due to a lack of understanding of these technologies and people simply not seeing how and where these energy sources can be used.These technologies are seen as very new to the public, and there is much that is unknown and no information that easily explains the benefits of these technologies to the general public.
Compared to the other PESTLE sub-indices, the technological dimension sub-index contains a larger number of indicators describing the main factors of technological performance.The results of the technological dimension sub-index show that batteries and thermal energy storage technologies outperformed biomethane and hydrogen storage in the technological dimension sub-index.This is mainly due to the higher maturity of the technology and the lower complexity of the technology to be integrated into the existing grid for batteries and thermal storage.This means that these technologies are more mature and already commercialized, which significantly increases the overall confidence in these technologies, as their performance has already been proven.However, the opposite is true for hydrogen and biomethane storage: these technologies are mostly still in the research and demonstration phase, and there are few already commercialized and proven solutions.Hydrogen and biomethane storage also require extensive modifications and adaptations to the existing infrastructure to integrate these energy resources into the existing grid, while the integration of batteries and thermal energy storage is much simpler and does not require much additional effort to adapt the grid.
In general, batteries and thermal storage also have higher round-trip efficiency compared to other alternatives.Round-trip efficiency is critical to a sustainable energy system because it represents the fraction of electricity that is stored and later retrieved, characterizing the extent of energy loss in storage [31].Hydrogen and biomethane have significantly lower round-trip efficiencies, which negatively impacts the overall energy efficiency of the conversion process and the sustainable use of these energy resources.
Response time is another important indicator that characterizes energy storage technologies.Response time is the time required for the entire energy system to provide energy at its full capacity [32].Batteries show the fastest response time (ms) compared to other technologies where response time ranges from seconds to minutes for hydrogen, biomethane and thermal energy storage technologies.The results of technology sub-index show that the main disadvantage of batteries is the shorter duration of storage at full power compared to other alternatives.
The legal dimension sub-index represents the degree of legal and administrative burden associated with the municipal energy system development project.A higher level of bureaucratic burden increases the time for approval of energy development projects and could therefore lead to significant delays in the transition to a sustainable energy system.The results show that both the bureaucratic burden of obtaining a municipal approval and the complexity to get environmental permit is lower for batteries and thermal energy storage than for hydrogen and biomethane.Due to the significantly higher uncertainty of hydrogen and biomethane, it would be much more complicated to obtain environmental permits to demonstrate that all safety concerns have been addressed and environmental risks have been eliminated.Similarly, because of the higher initial capital investment for hydrogen and biomethane, it would be much more difficult to convince municipality representatives to support these development directions unless reasonable economic justifications are presented.
The results of the environmental dimension sub-index showed that batteries had the lowest value among all technologies, with a value of 0.34.This is due to the shorter lifetime of the technology and the higher environmental impact.In general, lifetime of lithium-ion batteries ranges from 10 to 20 years [20].Although the average lifetime of batteries is increasing annually due to technological advances, it is still lower on average than other technologies in this study [33].
Considering the entire life cycle of technologies, which includes material extraction, manufacturing, and disposal of the product, batteries were found to have the greatest environmental impact among alternative technologies.The extraction of lithium-ion resources is a highly energy-intensive process that significantly impacts the overall resource efficiency of lithium-ion battery production [34].In addition, the short life of batteries requires much more frequent replacement of battery components, resulting in higher environmental impacts [15].There are still many concerns about the sustainable disposal of lithium-ion batteries, as leaks of hazardous substances can occur [34].
Potential risks and damages are also associated with hydrogen and biomethane storage, mainly due to the safety risks of the respective technologies.For biomethane, the risk of methane leakage should be considered.The production and transportation of biomethane poses a risk of methane leakage, a potent greenhouse gas.This can occur from biogas plants, pipelines, and storage tanks [35].Strict safety requirements must be observed for hydrogen, as hydrogen is a highly flammable gas.In addition, the production of hydrogen requires water, which can pollute local water resources if not handled properly [36].Thermal energy storage is generally associated with lower environmental risks and potential damage.
According to municipality representatives, there is space and areas in the region for the installation of all the energy storage technologies of this study, although it would be much easier to find suitable areas for batteries and thermal energy storage than for hydrogen and biomethane energy storage, which require more specific conditions.For hydrogen, closeness and availability of RES such as wind and solar power to generate electricity for electrolysis is required, and close access to water resources is recommended.For biomethane, closeness to existing biogas plants and availability of resources for biogas production in the region, such as organic waste, crop residues, animal manure, and others, are required.In addition, proximity and access to existing natural gas infrastructure for potential injection into the gas grid and closeness to water resources to be used in bioreactors are highly recommended for biomethane storage technologies.In terms of technology-specific requirements for specific geographic conditions, less stringent requirements are needed for batteries and thermal energy storage than for power-to-gas and power-to-liquid technologies.For batteries, close access to the power grid and availability of space are required.For thermal energy storage, closeness to the heat source, availability of space and, depending on the storage type, availability of water is required.
Fig. 4 illustrates the overall PESTLE composite index results.Thermal energy storage reached the highest composite index value of 0.67, followed by batteries with 0.60, hydrogen with 0.29 and biomethane with 0.28.The political and economic dimensions had the strongest influence on the overall results of the composite index, as the weights assessed by the municipality representatives were higher in the index calculation (for the political dimension -0.32 and the economic -0.27).As a result, thermal energy storage outperformed the other alternatives, mainly due to its stronger position in the political and economic dimension sub-index.In the case of batteries, the environmental dimension proved to be the weakest position due to the higher environmental impact it causes.However, it did not have a major impact on the overall results of the composite index, as it had an overall weight of 0.09.At the dimension level the highest disparities in the sub-index results were noticed in the economic and environmental dimensions.
Similar results of the PESTLE composite index were obtained for hydrogen and biomethane, as both technologies were found to have similar limiting factors for technology deployment in the municipal context.High capital investment, less targeted policy initiatives and support, and the higher complexity of these technologies to integrate into the existing grid are among the main reasons why hydrogen and biomethane storage lag significantly behind battery and thermal energy storage development.

Results from the Interviews with Municipality Representatives
The municipality representatives mention that in the current situation it is politically and nationally more important to preserve electricity on a national level than in local energy communities, which would be more efficient.The municipality has less control over the electricity system and the grid in the region, which is quite different for heat generation, which is more at the local level.
To accelerate the regional transition to low-carbon energy systems and make it more costeffective, it would be beneficial to establish a centralized team of professionals to manage environmental projects, rather than each municipality figuring it out on its own.Currently, one of the biggest cornerstones of the green energy transition is the lack of knowledgeable individuals and professionals to oversee such development projects, which include the development of energy storage infrastructure.It would be more efficient to have a national, centralized program that coordinates green energy transition projects in municipalities with a team of experts to drive these ambitious development projects.Collaboration and knowledge exchange between municipalities would improve in this way, and the process of deploying energy storage in the regions would accelerate significantly.
Knowledge of batteries is higher in municipality than other technologies, as 10 kW batteries are already installed in the municipality building and integrated into the overall solar power system of the building.Although the cost of batteries has decreased somewhat, they are still quite expensive relative to their benefits.These batteries can store about 1 hour of electricity, but in terms of cost, the batteries represent one-third of the total initial capital investment for the solar power plant.In winter, when solar power is not available to charge the battery, the plant draws power from the grid.
Knowledge of hydrogen in municipality is low, but municipality representatives admit that hydrogen production and storage solutions will develop rapidly in the future, and then municipality would have to consider whether to use hydrogen and in which energy consumption groups.It is important to understand what the optimal integration of hydrogen into the current energy system might look like.The municipality assumes that public transportation would be the most appropriate use of hydrogen.At present, hydrogen technologies could be important for large cities as public transportation, but most municipalities are in no hurry to rapidly deploy hydrogen and are waiting for greater certainty in the technology.Since in the municipality region of this case study does not use natural gas in its heating systems, the municipality does not foresee developing biomethane production and storage infrastructure in the near future.
The municipality in this case study uses biomass for heat generation, so the overall share of renewable energy sources in the municipality is considerably high.Most of the government funding available for green energy transition in municipalities is based on the principle of CO2 emission reduction, meaning that if a new development project can achieve higher CO2 emission reduction, the higher chance for that municipality is to receive government funding.If a municipality is already highly decarbonized, it is very difficult to obtain funding.And if a municipality cannot demonstrate high CO2 reduction potential, then the opportunities to obtain government funding are very limited, and a project without government funding is no longer economically viable for the municipality because the payback period is unreasonably long.Therefore, municipality representatives acknowledge that there is very limited ability for municipality to fund such investment projects as investments in energy storage technologies since municipality alone cannot bear the high investment costs.
Municipality representatives mention that there are psychological barriers, such as lack of knowledge about available technologies and their benefits.If the technology is unknown, then municipality tend not to choose it because they need to be able to operate with it and understand in detail how the system works.If the municipality's knowledge level is what it is, then the municipality may not even consider a technology as a possible option because they do not know anything about it.Lack of knowledge also impacts decision making regarding possible future directions in the municipality.If it is not understood how the technology works and the necessary experts and professionals are not available, municipality is afraid of what will happen in operation.Municipality representatives admit that there have already been cases with a simple system like a pellet boiler.It is difficult to find suitable professionals who are able to keep the system operating properly.This could be a big obstacle if there is no one at the plant who can maintain and manage the technology properly.
It is very difficult for municipalities alone to financially support large capital investment projects such as investments in energy infrastructure development.Government support is critical to the regional transition to carbon neutrality.Without state support, these technologies are not economically viable.With state support, municipalities are more open to considering new development pathways.It is also much easier to explain the economic justification for these investments to residents and to gain more public support.

CONCLUSION
In this study, a model combining both the PESTLE analytical framework and the composite index method was presented to compare the different energy storage alternatives and their potential deployment in a municipality in Latvia.Using a quantitative and qualitative assessment approach, such as interviews and surveys with municipality representatives, the study sought to quantify the key factors affecting the potential integration of the following four energy storage technologies in a municipality: 1. Lithium-ion batteries; 2. Water-based sensible thermal storage; 3. Power-to-gas (hydrogen); 4. Power-to-liquid (biomethane).Nineteen indicators grouped into six main dimensions such as political, economic, social, technological, legal, and environmental were used to evaluate and compare the selected renewable energy storage alternatives in a municipal context.
The analysis of the political dimension has shown that political initiative and support from the state, targeted policies at the national and international levels, and the identification of specific municipal priorities and needs are the key factors for the potential deployment of energy storage technologies.Currently, thermal energy storage and battery integration are a higher priority for the government, and as a result, there are national funding programs that support the development of such infrastructure in municipalities.However, there is no clear policy focus or support to accelerate the deployment of hydrogen or biomethane systems in municipalities.
The analysis of the economic dimension showed that thermal energy storage and batteries are currently the most cost-effective alternative, as they have the lowest specific capital investment costs (EUR/kW) and operation and maintenance costs (EUR/kWh) compared to hydrogen and biomethane, which require high investments in the construction of necessary infrastructure.In addition, the capital availability in terms of municipal co-financing for batteries and thermal energy storage is much higher, as the initial investment costs are lower.
The analysis of the social dimension revealed that both the public's and the municipality's attitudes and knowledge about the selected technologies are higher and more positive in the case of thermal energy storage and batteries, with which they are already familiar.However, the general public and the municipality are quite sceptical about the potential pathways to hydrogen and biomethane, as there is still a lot unknown about these technologies and the municipality does not have the necessary skills and knowledge to confidently understand how these systems work and how they could potentially be integrated into the municipal energy system.

Environmental and Climate Technologies
____________________________________________________________________________ 2023 / 27 287 The results of the technological dimension have shown that batteries and thermal energy storage currently outperform hydrogen and biomethane storage due to higher technological maturity, round-trip efficiency, and lower complexity of the technology to be integrated into the existing grid.While batteries showed the fastest response time among the other alternatives, their storage duration at full power was significantly lower than for thermal energy storage, hydrogen, and biomethane.
The legal dimension evaluated the degree of complexity to obtain an environmental permit and the degree of bureaucracy to obtain a municipal permit for all four alternative technologies.The results showed that for hydrogen and biomethane the approval process would be significantly more complicated due to safety risks and many uncertainties of these technologies, which could potentially delay the overall process of deploying these technologies in the municipality.
The results of the environmental dimension showed that batteries have the greatest potential environmental impact compared to other alternatives.This is due to the lithium-ion resource, which is very energy intensive to extract, and the disposal of lithium-ion batteries is associated with several sustainability issues.Batteries also have the shortest lifespan compared to other alternatives, which requires more frequent replacement of technical components and has a negative impact on resource efficiency.
Further research could apply the developed methodology in other municipalities, thereby augmenting the study's sample size and obtaining a more comprehensive perspective of extant challenges and motivators in municipalities.Additional indicators could be integrated into each dimension of the PESTLE analysis to further expand the analysis.

Fig. 1 .
Fig. 1.General framework of the research approach.
impact normalized indicator; I act the actual value of an indicator for the particular technology; I max the maximum value of an indicator across all the technologies; I min the minimum value of an indicator across all the technologies.
sub-index of a particular PESTLE dimension; w the value of determined weight of a specific indicator; I N + I N normalized indicators in each PESTLE dimension; nI the number of indicators in a dimension.

Fig. 3 .
Fig. 3. Sub-indices of PESTLE dimensions: a) Political dimension sub-index; b) Economic dimension sub-index; c) Social dimension sub-index; d) Technological dimension sub-index; e) Legal dimension sub-index; f) Environmental dimension sub-index.

TABLE 1 .
SELECTED PESTLE INDICATORS AND VALUES At first questionnaire contained the following nine questions asking respondents to assess different indicators for all four energy storage technologies on a defined scale: − How do you assess the municipality's knowledge about the possibilities of using certain storage technologies in the energy supply of Gulbene district?− How do you evaluate the state's policy initiative and support for innovation and development of municipal energy systems?− In your opinion, what are the priorities/needs of the Gulbene municipality for the installation of such technologies in the district?− What possibilities do you think the municipality would have to co-finance the implementation of the specific technology?− In your opinion, what is the attitude of society in the municipality towards the deployment of new technologies?− How would you assess the extent to which the existing energy supply networks in

TABLE 2 .
SUMMARY OF ASSIGNED WEIGHT STATISTICS