NV Energy Electricity Storage Valuation

Technical Report · Sat Jun 01 00:00:00 EDT 2013

DOI:https://doi.org/10.2172/1089991· OSTI ID:1089991

Ellison, James F. ^[1]; Bhatnagar, Dhruv ^[1]; Samaan, Nader ^[2]; Jin, Chunlian ^[2]

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1. Sandia National Laboratories (SNL-NM), Albuquerque, NM (United States)
2. Pacific Northwest National Laboratory (PNNL), Richland, WA (United States)

This study examines how grid-level electricity storage may benefit the operations of NV Energy, and assesses whether those benefits are likely to justify the cost of the storage system. To determine the impact of grid-level storage, an hourly production cost model of the Nevada Balancing Authority ("BA") as projected for 2020 was created. Storage was found to add value primarily through the provision of regulating reserve. Certain storage resources were found likely to be cost-effective even without considering their capacity value, as long as their effectiveness in providing regulating reserve was taken into account. Giving fast resources credit for their ability to provide regulating reserve is reasonable, given the adoption of FERC Order 755 ("Pay-for-performance"). Using a traditional five-minute test to determine how much a resource can contribute to regulating reserve does not adequately value fast-ramping resources, as the regulating reserve these resources can provide is constrained by their installed capacity. While an approximation was made to consider the additional value provided by a fast-ramping resource, a more precise valuation requires an alternate regulating reserve methodology. Developing and modeling a new regulating reserve methodology for NV Energy was beyond the scope of this study, as was assessing the incremental value of distributed storage.

• Research Organization: Sandia National Laboratories (SNL-NM), Albuquerque, NM (United States); Pacific Northwest National Laboratory (PNNL), Richland, WA (United States)
• Sponsoring Organization: USDOE National Nuclear Security Administration (NNSA)
• DOE Contract Number: AC04-94AL85000
• OSTI ID: 1089991
• Report Number(s): SAND--2013-4902; 456866
• Country of Publication: United States
• Language: English