The benefits of grid-scale storage on Oahu

Abstract

The Hawaiian Electric Company intends to procure grid-scale Battery Energy Storage System (“BESS”) capacity. The purpose of this study is to determine whether providing contingency reserve or time-of-day shifting is of more benefit to the Oahu grid, and to better understand the relationship between BESS size and level of benefit. This is an independent study by Sandia, and is not being used to support the regulatory case for BESS capacity by Hawaiian Electric. The study team created a production cost model of the Oahu grid using data primarily from the Hawaiian Electric Company. The proposed BESS supplied contingency reserve in one set of runs and time-of-day shifting in another. Supplying contingency reserve led to larger savings than time-of-day energy shifting. Assuming a renewable reserve and a quick-start reserve, and $15/MMBtu for Low-Sulphur Fuel Oil, the 50-MW/25-MWh, 100-MW/50-MWh, and 150-MW/75-MWh systems supplying contingency reserve provided, respectively, savings of 9.6, 15.6, and 18.3 million USD over system year 2018. Over the range of fuel prices tested, these cost savings were found to be directly proportional to the cost of fuel. As the focus is the operational benefit of BESS capacity, the capacity value of the BESS was not included in benefit calculations.