Impact of Wind and Solar on the Value of Energy Storage
This analysis evaluates how the value of energy storage changes when adding variable generation (VG) renewable energy resources to the grid. A series of VG energy penetration scenarios from 16% to 55% were generated for a utility system in the western United States. This operational value of storage (measured by its ability to reduce system production costs) was estimated in each VG scenario, considering provision of different services and with several sensitivities to fuel price and generation mix. Overall, the results found that the presence of VG increases the value of energy storage by lowering off-peak energy prices more than on-peak prices, leading to a greater opportunity to arbitrage this price difference. However, significant charging from renewables, and consequently a net reduction in carbon emissions, did not occur until VG penetration was in the range of 40%-50%. Increased penetration of VG also increases the potential value of storage when providing reserves, mainly by increasing the amount of reserves required by the system. Despite this increase in value, storage may face challenges in capturing the full benefits it provides. Due to suppression of on-/off-peak price differentials, reserve prices, and incomplete capture of certain system benefits (such as the cost of powermore »
- Publication Date:
- OSTI Identifier:
- Report Number(s):
- DOE Contract Number:
- Resource Type:
- Technical Report
- Research Org:
- National Renewable Energy Laboratory (NREL), Golden, CO.
- Sponsoring Org:
- USDOE Office of Energy Efficiency and Renewable Energy Policy and Analysis
- Country of Publication:
- United States
- 14 SOLAR ENERGY; 17 WIND ENERGY; 29 ENERGY PLANNING, POLICY AND ECONOMY VARIABLE GENERATION; VG; ENERGY STORAGE; WIND; SOLAR; PV; PHOTOVOLTAICS; Energy Analysis; Wind Energy; Solar Energy - General
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