Balancing Renewable Energy Capacity, Time of Use Tariffs and Energy Storage in Energy Systems

Abstract

The intermittency of solar energy predicates the simultaneous use of energy storage to maintain secure supplies. However, storage is expensive to instal and maintain, suggesting that there is an optimum design based on the price tolerance of electricity markets. In this chapter, a method for the calculation of the optimal size of a battery energy storage system (BESS), linked to utility-scale photovoltaic (PV) capacity, is presented. The method, which is illustrated by its application to the South African national grid (GridSA), uses historical generation/demand data to construct a spreadsheet model of the energy system. The model assumes that the difference between base load and energy demand, referred to as headroom, will be met using variable energy sources, including wind, solar, diesel/gas and batteries. Optimal sizing of these components to minimize the use of gas in summer, and make maximum use of low-cost solar and wind, leads to a configuration for GridSA consisting of a 22 GW base load (coal and nuclear), a PV installed capacity of 17.8 GW and a BESS capacity of 3.7 GW/10.4 GWh. A peak time of use tariff of ZAR3,500 per MWh (almost double the average tariff) will be optimal to build an economic case for energy storage as a sustainable option for GridSA.