Analysis of financial mechanisms in support to new pumped hydropower storage projects in Croatia

Abstract

h i g h l i g h t s" The most widespread storage in power systems is the pumped/reversible hydro storage. " The electricity market does not adequately rewarded all services that PHS provide to the electricity system. " The FIT-GO varies in the range of 42-265 €/MW h for an average capacity factor of 20%. a r t i c l e i n f o t r a c tThis paper analyses potential supporting schemes for pumped hydro storage (PHS) facilities in Croatia, which would guarantee recovery of the investment cost, with feed-in tariffs -for instance -which would guarantee payment for discharging wind-originated power as a reward for boosting the integration of renewable energy sources (RESs). The payment level acts as a floor basis for the PHS operator during the decision-making process to contract fixed payments for wind support or to act market-free on other market segments, through price arbitrage and reserve provision. The market share required for the efficient operation of a PHS facility and the levels of feed-in tariff (FIT) are set mathematically. Main findings put the level of FIT for an applied project in Croatia in the range 42-265 €/MW h for an average load factor of 20%, depending on particular local conditions, such as the level of wind power curtailment in the system, the power price for charging the storage and the number of pumps and penstocks, which could lower the capital cost. It is claimed that not all services that PHS provides to the electricity system are adequately rewarded by the electricity market, and thus there is a serious uncertainty as to how investment costs in energy storage would be recovered. Other elements, outside the market, are likely to influence the operation of PHS, such as the regulated level of a desirable rate of curtailment of RES power excess, the adequate level of energy security and the reserve margins which PHS could help to ensure.

The Energy Transition and the Advent of the Hydrogen Economy

“…The production from RES, characterized by variable temporal availability, unpredictable over time, can in fact efficiently meet energy needs if coupled with storage systems (mechanical, electrical, chemical, thermal, biological, etc. ): it follows that thanks to its energy performance and its environmental sustainability, the interest in hydrogen as energy carrier is growing today [9][10][11].…”

Economic Evaluation of Actively Consuming Wind Power for an Integrated Energy System Based on Game Theory

“…where a, b are constants. It can be seen from Equations (7) to (11) when the operating power of the regenerative electric boilers is running under the mode of tracking the curtailed wind, it can consume more curtailed wind. After the energy storage system is added to the wind power heating system, it will track the curtailed wind more timely and accurately, improving the imbalance problem between the "source" and "load", reduce the adjusting numbers of the electrode rods, and prolong the service life of the regenerative electric boilers.…”

“…A pumped storage power station is used to store the curtailed wind at night in the form of water energy, and deliver them to the grid when the load is in peak periods in the daytime, which has been widely used in many countries and regions. However, its construction period is too long [10][11][12]. Electric boilers can directly consume the curtailed wind for heating in low load periods to mitigate the heat pressure of the CHP units.…”

Techno-economic analysis of grid-connected battery storage

“…In [8], it was determined that it is not possible to create a return on investment if the electricity price does not increase more than the inflation for battery storage for houses, considering the subsidy system, the electricity price, and the purchase cost of a PV installation and a battery system. In [9] an analysis of potential supporting schemes for pumped hydro storage facilities in Croatia concluded that a clear regulatory framework is necessary (e.g., applying a feed-in tariff, which guarantees the payment of the capital cost and a reasonable rate of return). [10] proposed a model for the economic feasibility of CAES improves wind power integration and found that given the present conditions on the minute reserve market, no CAES power plant is economically feasible.…”