Optimal Investment Planning of Bulk Energy Storage Systems

Abstract

Many countries have the ambition to increase the share of renewable sources in electricity generation. However, continuously varying renewable sources, such as wind power or solar energy, require that the power system can manage the variability and uncertainty of the power generation. One solution to increase flexibility of the system is to use various forms of energy storage, which can provide flexibility to the system at different time ranges and smooth the effect of variability of the renewable generation. In this paper, we investigate three questions connected to investment planning of energy storage systems. First, how the existing flexibility in the system will affect the need for energy storage investments. Second, how presence of energy storage will affect renewable generation expansion and affect electricity prices. Third, who should be responsible for energy storage investments planning. This paper proposes to assess these questions through two different mathematical models. The first model is designed for centralized investment planning and the second model deals with a decentralized investment approach where a single independent profit maximizing utility is responsible for energy storage investments. The models have been applied in various case studies with different generation mixes and flexibility levels. The results show that energy storage system is beneficial for power system operation. However, additional regulation should be considered to achieve optimal investment and allocation of energy storage.

Multi-Period Generation Expansion Planning for Sustainable Power Systems to Maximize the Utilization of Renewable Energy Sources

“…Finally, our proposed GEP model to increase the RES utilization is made up of the objective Function (1) and Constraints (2)- (24). This GEP model is one of mixed-integer linear programming (MILP) problems.…”

“…As the RES penetration has increased rapidly in recent years, power system flexibility, ramping capability, and sufficient reserve are urgently required to deal with the inherent intermittency and uncertainty of RES [22][23][24]. However, ramping and reserve requirements can only be modeled on multiple sequential times, e.g., 24 h of one day.…”

Site Selection Criteria for Battery Energy Storage in Power Systems

“…From the former sections it has become evident that whenever a grid service is considered for BESS, it becomes crucial to investigate whether or not it would be technically feasible to target specific grid services and if it would have profitable revenue streams or not. It is important to note that, even though high revenue streams can be targeted from some of the grid services, there are still high costs associated with BESS that cannot be ignored in economic evaluations [52].…”

“…To ensure that this process runs smoothly, designing optimal investment plans beforehand is essential. For this multiple investment scenarios and several dispatch schedules need to be considered [52], [53]. Once investment plans are finalized and operational profiles are selected, aggregation potential of stacked revenue streams can be evaluated.…”

Agent-Based Models in Electricity Markets: A Literature Review

“…Many electricity market models assume that all players have access to the same information and have the same objectives. Under such conditions, the market can be modelled as one or more optimisation problems [1]. However, with the increased integration of renewable energy sources, the power system is subjected to higher uncertainty.…”