Title: Valuation Framework for Large Scale Electricity Storage in a Case with Wind Curtailment
Authors: LOISEL RodicaMERCIER ArnaudGATZEN ChristophELMS NickPETRIC Hrvoje
Citation: ENERGY POLICY vol. 38 no. 11 p. 7323-7337
Publisher: ELSEVIER SCI LTD
Publication Year: 2010
JRC N°: JRC60300
ISSN: 0301-4215
URI: www.elsevier.com/locate/enpol
http://publications.jrc.ec.europa.eu/repository/handle/JRC60300
DOI: 10.1016/j.enpol.2010.08.007
Type: Articles in Journals
Abstract: This paper investigates the value of large scale applications of electricity storage in selected European power systems in the context of wind generation confronted with a grid bottleneck. It analyzes the market value to 2030 of two storage technologies, assuming the market situation projected for Germany and France. The analysis assesses the evolution of storage economics based on the net present value of cash flows. Sensitivities to market and regulatory drivers of value are assessed, e.g. electricity price spreads, ancillary services revenues, wind curtailment and the level of carbon prices. The paper concludes by suggesting possible ways to improve the competitiveness of electricity storage, such as research and development and deployment programmes, and changes to the design of power markets and regulatory arrangements to enable storage owners to better capture the benefits of storage. Such changes would allow electricity storage, where economically viable, to play a critical role in establishing a future sustainable European power system.
JRC Institute:Institute for Energy and Transport

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