Techno-Economic Sizing of a community battery to provide community energy billing and additional ancillary services

Elkazaz, Mahmoud; Sumner, Mark; Naghiyev, Eldar; Hua, Zhihao; Thomas, David William

doi:10.1016/j.segan.2021.100439

Cited by 16 publications

(7 citation statements)

References 34 publications

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“…According to [5,18], there is limited literature focusing on how energy communities and PV-battery systems affect the distribution grid. Until now, most studies on energy communities have primarily focused on the sizing and siting of PV and battery systems [19][20][21][22], market designs [23][24][25], or the difference between individual and shared assets [3,[26][27][28][29][30][31]. Few of these studies [19,24,26] have investigated how energy communities impact the grid, but not specifically focused on how the energy community operation can be changed to provide a grid service.…”

Section: Related Literaturementioning

confidence: 99%

Quantifying the Benefits of Shared Battery in a DSO-Energy Community Cooperation

Berg¹,

Rana²,

Farahmand³

2023

Preprint

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<p>Local energy communities are forming as a way for prosumers and consumers to invest in distributed renewable energy sources, community storage and share electricity. Meanwhile, several distribution grids have voltage problems at certain hours of the year. Local energy communities consisting of generation and storage units might be valuable flexible assets that the distribution system operator (DSO) can make use of. This article aims to study how a battery in an energy community can provide services to the distribution grid, by creating a linear optimisation model which includes power flow constraints and a battery degradation model. First, we investigate how the battery operation of an energy community impacts the voltage in the nearby buses. We find that when including the degradation model, the voltage limits are violated much less than when not including the degradation model. Next, we investigate how the battery operation differs when the energy community cooperates with an active DSO to share the battery use, and quantify how much the DSO should remunerate the energy community. We find that the energy community should get 15 € per year due to an increase in electricity and degradation costs, which equals an increase of 0.12%, compared to when the community is not providing a service. Finally, a sensitivity analysis is performed to determine which parameters are more important to consider. We find that voltage violations in the grid are sensitive to the battery replacement cost, electric vehicle charging peak and the average spot price, while the remuneration from the DSO is sensitive to the battery replacement cost. For small battery sizes and a low power-to-energy ratio, the community is not able to improve the voltage at all hours of the year.</p>

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Section: Related Literaturementioning

confidence: 99%

Quantifying the Benefits of Shared Battery in a DSO-Energy Community Cooperation

Berg¹,

Rana²,

Farahmand³

2023

Preprint

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“…The power output from the PV system is calculated from irradiance and temperature data for Maere, Norway, as explained in more detail in [13]. The replacement cost for the battery, used to find the degradation cost in (7), is assumed to be the annualised investment cost of the battery since the analysis is carried out over one year. Fig.…”

Section: Case Studymentioning

confidence: 99%

“…as arbitrage, self-consumption and reducing peak imports. A shared community battery for reducing costs while providing ancillary services was proposed in [7], but focuses more on participation in balancing markets. Ref.…”

Section: Introductionmentioning

confidence: 99%

The impact of degradation on the investment and operation of a community battery for multiple services

Berg

Bjarghov

Rana

et al. 2022

2022 18th International Conference on the European Energy Market (EEM)

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The emergence of local energy communities (LECs) introduces new concepts and dynamics to the operations of distribution grids. An important part of LECs is the shared ownership or control of assets such as photovoltaic systems and batteries. The aim of this article is to investigate how degradation impacts the investment and operation of a community battery which performs multiple services in a LEC. Two different grid tariffs are investigated: energy-based and demand charges. The case study set in Norway 2030 shows that the lifetime of the battery is significantly shortened when not considering degradation, highlighting the need to include cyclic degradation in models that investigates the profitability in investment and operational problems with batteries. In the case of a demand charge grid tariff, the expected lifetime was shortened by 6 years.

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“…Many existing studies have investigated the economics of BESS investment, focusing on developing optimal control strategies to maximize revenue [3], [8], [14]- [18] or on optimal sizing of the battery to reduce capital expenditure [17], [19]- [21]. In developing these optimal solutions, most studies assume the existence of long-term contracts, use historical prices as references, or assume perfect advance knowledge of future prices, and do not consider market risk or performance risk.…”

Section: Introductionmentioning

confidence: 99%

“…For example, in [17], existence of a long term contract is assumed. In [8], the historical PJM price of 2014-2015 was used to develop strategies for revenue stack-up.…”

Section: Introductionmentioning

confidence: 99%

Techno-Economic Investment Risk Modeling of Battery Energy Storage System Participating in Day-Ahead Frequency Regulation Market

Hsi,

Shieh

2024

IEEE Access

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Owing to its high capital cost, Battery Energy Storage System (BESS) investment risk has received considerable attention in recent years. Currently, day-ahead frequency regulation service is one major revenue source for BESS, and the revenue is exposed to a compound of stochastic market risk and technical risk. On the market risk side, due to a lack of long-term contracts, investors are exposed to "price risk" and "volume (revenue hours) risk" over the entire investment horizon of 5-10 years. On the technical side, performance issues such as equipment degradation and inherent defects can result in reduced or even negative revenue for BESS under the pay-for-performance remuneration structure. Quantifying these risks is important for investors and banks to assess a project's investability and bankability. However, existing BESS techno-economic literature has mostly focused on developing optimal control strategies to maximize revenue or optimal battery sizing to reduce capital expenditure. To our knowledge, none of the literature to date has addressed the long-term risk perspective of BESS investment. This study aims to fill this gap by developing a long-term probabilistic revenue estimate that considers these risk factors using Monte Carlo simulations. A case study using Taiwan's newly launched day-ahead market, which has similar grid dynamics and revenue risk factors as in most markets, is also presented in this paper. Simulation result shows that, for the conservative P90 (90% exceedance probability) scenario, expected return of a hypothetical 10MW (half-hour battery) BESS investment is 8.65% and its debt service coverage ratio is 1.189.

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Techno-Economic Sizing of a community battery to provide community energy billing and additional ancillary services

Cited by 16 publications

References 34 publications

Quantifying the Benefits of Shared Battery in a DSO-Energy Community Cooperation

Quantifying the Benefits of Shared Battery in a DSO-Energy Community Cooperation

The impact of degradation on the investment and operation of a community battery for multiple services

Techno-Economic Investment Risk Modeling of Battery Energy Storage System Participating in Day-Ahead Frequency Regulation Market

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