Benefit and value of Li-ion batteries in combination with large-scale renewable energy sources.

Li-ion batteries have demonstrated to be a very flexible source with energy storage capability. Due to their scalability and wide range of power and energy densities, they are suitable for several applications. Li-ion storage can therefore provide different services, the remuneration of which depends on the electricity market of the country. In this work, two different case studies of combination of Li-ion batteries with large-scale renewable power plants have been investigated: batteries with solar PV in India and with wind power in Sweden. Simulation models have been developed to assess the operation and profitability potential of different services in these two case studies. The models have been built using control algorithms, linear optimization (LP) and stochastic programming techniques. The results show that the use of batteries for solar power output smoothing under a power purchase agreement can be a profitable business case in India. Moreover, batteries providing primary frequency regulation (FCR-N) in Sweden show to have a positive economic value. System breakeven costs to make the stacking of wind power production imbalance compensation and FCR-N services profitable have been found, which based on conservative price expectations should be achieved by 2022

Benefit and value of Li-ion batteries in combination with large-scale renewable energy sources.

Li-ion batteries have demonstrated to be a very flexible source with energy storage capability. Due to their scalability and wide range of power and energy densities, they are suitable for several applications. Li-ion storage can therefore provide different services, the remuneration of which depends on the electricity market of the country. In this work, two different case studies of combination of Li-ion batteries with large-scale renewable power plants have been investigated: batteries with solar PV in India and with wind power in Sweden. Simulation models have been developed to assess the operation and profitability potential of different services in these two case studies. The models have been built using control algorithms, linear optimization (LP) and stochastic programming techniques. The results show that the use of batteries for solar power output smoothing under a power purchase agreement can be a profitable business case in India. Moreover, batteries providing primary frequency regulation (FCR-N) in Sweden show to have a positive economic value. System breakeven costs to make the stacking of wind power production imbalance compensation and FCR-N services profitable have been found, which based on conservative price expectations should be achieved by 2022

Forbrukerfleksibilitet i kraftmarkeder

Demand flexibility integration is an important measure for the decarbonization of energy systems and a more efficient use of resources. Demand flexibility can provide multiple benefits to the power system and reduce system costs. Adjusting electricity demand to match variable production supports the integration of larger shares of variable renewable energy (VRE). Using demand response for system services provided by network operators can contribute to a more cost-efficient use of infrastructure and resources. Demand flexibility is a large and complex field of study which includes different markets, different grid voltage levels and different actors. The aim of this PhD project is to study how demand flexibility can be optimally integrated into electricity markets, taking account of the benefits to the power system as a whole and the interplay between different markets. Demand flexibility is studied from the perspective of the whole system, as well as from the private economic perspective of aggregators and electricity consumers. The thesis includes separate studies which go in depth about specific topics. The whole system perspective is studied in Paper I, which focuses on the value of demand flexibility in spot and reserve markets in power systems with high shares of VRE. The perspective of TSO and DSO is studied in Paper II, which proposes a marketplace for procurement of transmission and distribution system services from demand flexibility. The perspective of demand flexibility aggregator is studied in Paper III which develops an optimization framework for an aggregator participating in the wholesale and the regulation capacity markets. The perspective of private electricity consumers is studied in Paper IV which studies price-based demand response and investments in load control in an energy system. The results of these studies offer various useful insights. Firstly, demand flexibility was found to significantly decrease the system cost when large shares of VRE are integrated into the system. This happens primarily by replacing reserve provision from coal and gas plants but also by reducing peak load generation due to price response on the wholesale market. Optimal allocation of demand flexibility between reserve and wholesale markets maximizes the system benefits. The results suggest that in systems with large shares of VRE and small shares of base load, more demand flexibility should be placed in the reserve market than in the wholesale power market. Demand flexibility also benefits the distribution system, and it was also found that new market designs and better coordination between the transmission and distribution levels are important for efficiently integrating demand flexibility and minimizing the total procurement costs. New market designs can ensure that demand flexibility is used to maximize the value for the whole system and not only for single actors. Next, the results of the studies illustrate that demand flexibility access to many markets is beneficial, from both the system and private economic perspectives. It increases the value of demand flexibility, gives incentives to aggregators’ business and ensures that demand flexibility is optimally allocated between markets based on price. However, market interplay can also have negative effects, as when demand flexibility providers favour one particular market with higher profitability and flee from other markets. New market designs for demand flexibility should consider the interplay between different markets. Finally, modelling demand response to electricity price shows that private investments in demand flexibility are governed by the cost of load control, the daily electricity price variability and the price flattening effect. The price flattening effect implies that demand response to price reduces price volatility in the market, and at some point, no more demand response is feasible. To achieve this optimal demand response level in the wholesale market, it is important to have correct feedback between the market and consumers so that they do not respond more is optimal from the system perspective. To sum up, the results of this PhD research suggest that efficient integration of demand flexibility into electricity markets implies giving it access to many markets, strengthening the role of aggregators, improving coordination between the distribution and transmission system levels and promoting market designs that optimize demand flexibility use and system value. This thesis illustrates the importance of studying demand response in a holistic perspective, including different markets, actors and system levels.Norwegian Research Council ; Enfo ; Sysco ; NV

End-User Flexibility in the Local Electricity Grid – Blurring the Vertical Separation of Market and Monopoly?

In the Norwegian electricity system, new consumption patterns and changing load profiles increase an already apparent need for reinvestment in the aging network infrastructure. This is very costly, and network operators consider alternative ways of increasing capacity, which are less costly and more flexible. One such option is end-user flexibility. In the paper, we give an overview of the Norwegian electricity market and regulation and the potential of end-user flexibility. We present an investment case provided by a network company, which illustrates that the choice of compensation method to customers have a large impact on the cost and/or revenue cap in the regulatory model. By issuing direct payments for flexibility services, end-user flexibility results in a lower efficiency, although the revenue cap may be higher, while redistribution of network tariffs have a marginal effect on efficiency and the revenue cap. Through redistribution of network tariffs, the network operator can defer investments without a notable change in the revenue cap or change in efficiency. This highlights some of the future challenges that the regulator faces in setting a regulatory framework for end-user flexibility and it challenges the vertical separation that has been a corner stone in the deregulated electricity market

Economic and Technical Evaluation of Flexible Power GenerationScenarios for a Biogas Plant

Biogas plants can contribute significantly to the integration of renewable energy sources in the energy system due to their flexible operability. The storability of the energy carrier enables them to generate power in a demand-oriented way and to participate in electricity markets that focus on balancing power supply and demand. In this study process simulation was used to investigate the economic and technical effects of flexible power generation on an Austrian biogas plant that focuses on biomethane production. Three different power generation scenarios were evaluated considering participation in the electricity spot market and markets for control energy reserves, while continuously producing biomethane. The results show that no major technical adaptions are needed for flexible power generation but an appropriate support scheme (premium system) is required to make demand-oriented power generation economically viable. The determined required premium was 37.3-99.9 EUR/MWh depending on the power generation scenario

Grid-Scale Battery Storage for Variable Renewable Electricity in Sweden

This thesis explores how a market for grid-scale battery energy storage systems (BESS) can become reality in Sweden. Higher penetration levels of distributed, variable renewable energy (VRE) from wind power challenge the incumbent energy regime and require new solutions for the grid integration of renewables. As a consequence, a more flexible power system is needed in order to deal with the induced supply-side variability. Batteries, as one flexibility solution among several other options, have shown promising technological development and are a versatile electricity storage option. BESS can provide multiple benefits for different application areas on the grid at various scales. The emergence of grid-scale BESS in Sweden was analysed using the multi-level perspective (MLP) framework on socio-technical transitions. Despite the great potential and the rapid technological progress of BESS, it was found that regulatory factors, both in Sweden and the EU, currently constitute a major barrier for the deployment of large-scale electricity storage. Moreover, Sweden looks set to continue to increase the uptake of VRE from wind power, whilst a gradual phase out of nuclear power over the next decades is also likely. Whereas this would normally have negative implications for the power system, the ample hydropower capacity and sufficient interconnection to the neighbouring Nordic countries provide, at least for the near future, enough system flexibility and therefore reducing the need for the installation of BESS. However, the uneven geographic distribution of electricity consumption and generation across Sweden might give rise to flexibility solutions for enhancing local distribution networks in the future in order to eliminate potential regional bottlenecks

Combined heat and power plants in decarbonized energy systems: Techno-economics of carbon capture and flexibility services at the plant, city and regional levels

Our present energy system is the main driver of climate change. Variable renewable electricity generation and carbon dioxide removal (CDR) are key technologies in the transformation to a sustainable energy system, but their broad implementation implies challenges related to energy system flexibility and energy requirements of CDR technologies. The aim of this thesis is to investigate the potential and incentives for combined heat and power (CHP) plants in Sweden to contribute with CDR and flexibility services in the energy system. A techno-economic assessment scheme that considers variability in boundary conditions, such as electricity prices, and includes the CHP plant, city, and regional energy system levels is developed and applied. System optimization modeling and process-level case studies are performed to investigate how CHP plant flexibility measures are utilized and valued, and to estimate the cost and potential of CDR from Swedish CHP plants.The results indicate a large potential for Swedish CHP plants to contribute to CDR, with at least 10 MtCO2/year being available for capture and storage. The realizability of this potential is challenged by the cost of carbon capture which increases notably for CHP plants that are small and have few full load hours. CHP plants can cost-effectively contribute with flexibility provision in the studied electricity system, although the impact on the total system is limited, as the installed capacity of CHP plants is small relative to the magnitude of net load variability. From a plant perspective, the plant revenue can increase if the operation is scheduled to follow electricity price variability, but this requires a significant level of price volatility and access to large-scale thermal energy storage for maximum benefit. The fuel price has a strong impact on the competitiveness of biomass-fired CHP plants on a regional level, that compete with power-to-heat technologies in the district heating sector. In contrast, in cities, there are stronger incentives for CHP plants as heat producers regardless of how the surrounding energy system and market prices develop, due to a limited availability of other technology options and a limited grid connection capacity to drive power-to-heat