Battery energy storage integration in wind farms: Economic viability in the Spanish market

Abstract

This paper proposes an economic assessment tool that determines the viability of a battery energy storage system (BESS) integrated within renewable power plants for different market applications such as day-ahead price arbitrage, participation in the balancing market and schedule tracking by reducing wind deviations. In particular, maximum BESS investment prices are derived to make BESS potentially viable for each functionality. A case study of an actual 30 MW wind farm participating in the Spanish electricity market is used to test the economic viability of different sizes of Li-ion and vanadium-redox BESS. Results show that with the actual structure and level prices in Spain, the participation in the balancing market could achieve positive internal rates of return, and the combination of additional market functionalities does not improve substantially BESS viability. • Formulation of an optimization model for economic assessment and sizing of hybrid operation of battery energy storage systems and renewable power plants. • Single and combined market functionalities considered: price arbitrage, reserve provision, and wind schedule tracking. • Application to the Spanish power system: Li-ion and Va-Re integrated in a real Spanish 30 MW wind farm are assessed. • Results have shown that in Spain, only the possibility of balancing market participation can make the BESS potentially viable depending on the size of the device.