Optimal Sizing of Grid-Scaled Battery with Consideration of Battery Installation and System Power-Generation Costs

Abstract

Variable renewable energy (VRE) generation changes the shape of residual demand curves, contributing to the high operating costs of conventional generators. Moreover, the variable characteristics of VRE cause a mismatch between electricity demand and power generation, resulting in a greater expected energy not supplied (EENS) value. EENS involves an expected outage cost, which is one of the important components of power-generation costs. A utility-scale battery energy storage system (BESS) is popularly used to provide ancillary services to mitigate the VRE impact. The general BESS ancillary-service applications are as a spinning reserve, for regulation, and for ramping. A method to determine optimal sizing and the optimal daily-operation schedule of a grid-scale BESS (to compensate for the negative impacts of VRE in terms of operating costs, power-generation-reliability constraints, avoided expected-outage costs, and the installation cost of the BESS) is proposed in this paper. Moreover, the optimal BESS application at a specific time during the day can be selected. The method is based on a multiple-BESS-applications unit-commitment problem (MB-UC), which is solved by mixed-integer programming (MIP). The results show a different period for a BESS to operate at its best value in each application, and more benefits are found when operating the BESS in multiple applications.