Due to their intermittent nature, high penetration of renewable energy resources (RES) can deteriorate power system reliability. A battery energy storage system (BESS) offers an opportunity to reduce the uncertainty associated with RES and hence improve power system reliability. In the last decade, the cost of BESS has declined so its deployment has become increasingly feasible, but the decision ultimately depends on its Net-Benefit to the investor. Depending on the perspective of the investor, the deployment decision involves discovering the most optimal location, capacity, and technology of BESS. A sensitivity analysis based on the Z-bus matrix is used for selecting the optimal location. In this paper, from the narrow perspective of a private investor, the Net-Benefit function is the energy arbitrage value of BESS minus its overall cost. However, the system operator additionally values BESS because it enables more reliable system operation at reduced operating costs. After examining multiple power system reliability indices, the product of Expected Unserved Energy (EUE) and Value of Lost Load (VoLL) is incorporated into the Net-Benefit function of the system operator. MATPOWER Optimal Scheduling Tool (MOST) is used for testing the proposed Net-Benefit functions on a standard reliability test system (RTS) known as RTS-GMLC. Three diverse case studies are examined in three exploration phases; the first phase helps determine search space whereas the second one narrows it down and the third phase finds the optimal BESS solution. Presented research results demonstrate that, over a period of 15 years, optimal BESS deployment can offer as much as $M164.8 and $M33.6 Net-Benefits to the system operator and private investor respectively.
Read full abstract