Multi-use battery energy storage systems
Student name: Ms Anukriti
Guide: Mr Amit Kumar
Year of completion: 2017
Host Organisation: Institute of Energy and Climate Research, Systems Analysis and Technology Evaluation (IEK-STE), Fors
Supervisor (Host Organisation): Mr Johannes Fleer
Abstract: Battery Energy Storage Systems are increasingly becoming an option for storing electrical energy in
the present-day power systems. Even though the specific investment costs (€/MWh) are presently
high, their costs are decreasing. This is a result of increase in efficiencies, high response time, high
energy densities, etc. Therefore, the profitability of employing batteries over other technologies for
energy storage, could increase in the near future.
The importance of energy storage systems in the power grid has become increasingly necessary over
the past few years due to the worldwide shift in electrical power sector from conventional energy to
renewable energy. Batteries, enable the grid operator to exploit the stored chemical energy to be
used at a later time (time-shift). In addition, batteries can provide multitude of services for on and
off-grid applications. In this study, only grid connected batteries have been analyzed. Their value
addition in form of grid-services has been assessed by evaluating their ability to a) displace
conventional energy generation methods and b) provide new use-cases for grid support.
The investment required for battery storage remains high, despite its inherent benefits. To this end,
this study analyses the costs for lithium-ion batteries and compares it with the revenue generated
from their use in different grid-applications. The study shows that by using a single battery storage
system for more than one applications, could yield higher revenues for an operator. Threshold values
for battery rating are identified where the profits per day equal the investment made. Additionally, it
can be possible to decrease the payback period and increase the profitability by increasing the
revenue streams for battery operation.
The study also notes the services provided by the batteries that do not result in quantifiable revenue
streams, but assist efficient transmission and distribution of power. The qualitative analysis therefore
reveals the possibility of new revenue generation mechanisms in the future power markets and
consequently additional application fields for the battery systems.
