Cloud energy storage for grid scale applications in the UK

Abstract

In this paper, the UK's electricity market and battery technologies were researched to determine the economics of aggregating domestic batteries for grid-scale services. A feasibility study was conducted under three scenarios in order to estimate the value of Advanced Lead-Acid (ALA) and Lithium-Ion (LI) batteries for domestic households in the UK. A profit optimization model was built using historical market data, and technical parameters of the batteries. An aggregated system of 5000 batteries was simulated and used to compare and stack value streams of seven different grid-scale services in the UK, including energy arbitrage, reserve and frequency regulation services.The results showed that using a battery system for domestic services is currently not economically viable, however grid-scale provision of dynamic frequency response and fast reserve services yield sufficient annual revenue to compensate for these losses. The annual profit margin per household obtained was £ 532/692 for ALA and LI batteries respectively, allowing a shared margin of £ 230–300 after accounting for household costs.The promotion of an aggregated storage system is hindered by current regulatory barriers in the UK, such as a double payment structure for storage operators, lack of subsidy and lack of separate definition for storage devices.