Centralized Energy Storage System (CESS)
A central energy storage system (CESS) enables residential consumers/prosumers to share their EES flexibility with the electricity grid. This provides an opportunity to achieve higher savings for them and improve the value of their investments in EES.
Our results show that centralized coordination of storage improves the balancing of demand and flexibility resources, leading to lower peak electricity prices for consumers. This results in greater annual electricity cost savings for the typical consumer, compared to distributed coordination under Gone Green and Slow Progression scenarios.
Variable Renewable Capacity
Distributed energy storage enables the integration of variable renewables into the electricity system through services such as load shifting, energy arbitrage, and ancillary grid support. It also provides climate benefits by reducing emissions from diesel and gasoline generation and by lowering losses along power lines. Moreover, distributed backup generation allows utilities to offer clean, reliable power at lower voltages, and can be located closer to consumers, thus making it possible to serve more customers, especially in remote areas.
To maximize these potential benefits, Centralized Energy Storage System it is important to understand how the operation of EES affects the value of these resources for consumers and the energy system at large. This paper compares two schemes for the operation of distributed EES: uncoordinated (a) and centrally coordinated (b).
Under the centralized coordination scheme, electricity prices drop in the system for all consumers, irrespective of whether they own onsite energy technology or not. Consequently, PV-EES owners make 0-2% additional savings in the centralized scheme while consumers without onsite energy technologies benefit almost double at 2-10%. This suggests that a policy to redistribute some of the system-level benefits of aggregation back to the EES providers could increase their incentive for participating in the centralized coordination scheme.
These results show that the operational performance of home batteries depends on a number of energy and energy system conditions, which might explain why previous studies tend to overestimate the capacity contribution of demand-side aggregation. Providing consumers with clear, accurate information on the potential savings from their storage device would help build consumer confidence in the technology and facilitate deployments.
Flexible Supply Capacity
The system-efficient operation of EES depends on its ability to provide flexibility for the electricity system. Its value to consumers also depends on the level of demand-side flexibility in the electricity system, and is inversely related to the availability of flexible supply resources such as gas power plants.
The value of home batteries for consumer energy storage aggregation is largely driven by its capacity to contribute system-level flexibility and reduce peak and off-peak electricity prices. However, the potential revenue of storage owners from ancillary services and transaction fees may offset these benefits. Therefore, it is important to understand the trade-off between private and system benefits in any EES aggregation scheme.
EES aggregation can be deployed in both grid-connected and islanded modes for a variety of applications including microgrids, zero energy buildings, and power-demand response at military bases. This video simulates grid-connected and islanded flows among distributed energy resources at a military base while connected to the grid and during a grid disturbance.
NYSERDA has filed New York’s 6 GW Energy Storage Roadmap to the Public Service Commission that would enable a broad range of technologies for integrating renewables into the State’s electric supply and stabilizing load during peak electric usage. These NYSERDA-led programs are projected to reduce future statewide electric system costs and bolster customer resilience. This will allow New York to achieve its nation-leading climate goals and create thousands of jobs in a rapidly growing industry.
As energy storage is aggregated to participate in the electricity system, its private savings to consumers decline. This is because herding behaviour tends to lead consumer EES devices to be operated in a way that maximizes their own costs, regardless of the system-level benefits they could offer through aggregation. Moreover, the size of the benefit to consumers also depends on the evolution of the electricity and energy systems.
For example, with centralized scheduling, the value of home batteries declines if consumers without onsite energy technologies are included in the aggregation scheme. This is because peak electricity prices decline in the system for all consumers, which offsets the reduction in their own electricity bills.
This is a key finding that should be communicated to consumers contemplating investing in energy storage. The information would help improve their confidence in the technology and might facilitate deployments. Furthermore, it could be useful to have an Centralized Energy Storage System easily accessible tool that calculates the potential benefits of EES for a given scenario and energy system conditions.
The tool should include the system operator’s forecast of energy demand, the amount of renewable generation and the expected evolution of electricity system constraints over time. It should also take into account the level of EES storage deployed in the system and the fraction that will be aggregated. This will allow a calculation of the impact of the aggregated storage on the average annual electricity bill of consumers and its corresponding cost-benefits.
The ancillary services energy storage can provide, such as fast-response balancing of demand and supply to reduce curtailment of renewable generation and spinning reserve requirements from conventional resources, can help system operators optimize the capacity available in their systems. This can reduce the need for new investments in generation to meet peak demand and improve transmission and distribution infrastructure utilization, reducing the costs of grid operations and maintenance.
Energy storage systems offer a number of other benefits for consumers, including backup power to protect against outages and lower electricity prices, as well as improving the value of their onsite solar PV installations. These benefits can increase the confidence of consumers in investing in EES, and can facilitate their deployments. The public disclosure of the existing and planned energy storage capacities in the electricity system and the fraction of these that are centrally coordinated could help increase consumer confidence and facilitate adoption of this technology.
This study demonstrates that the annual electricity cost savings of consumers who allow their EES to be managed by an aggregator under various technologies, tariffs and future energy scenarios are substantially higher when these storage capacities are centralized than when they are not. The benefits of the centralized coordination are higher for consumers without onsite energy technologies than for those with PV-battery, because peak electricity prices decline in the system and their private savings increase.