Abstract
Large-scale battery storage will become an essential
part of the future smart grid. This paper investigates the optimal
bidding strategy for battery storage in power markets. Battery
storage could increase its profitability by providing fast regulation
service under a performance-based regulation mechanism, which
better exploits a battery’s fast ramping capability. However,
battery life might be decreased by frequent charge–discharge
cycling, especially when providing fast regulation service. It is
profitable for battery storage to extend its service life by limiting
its operational strategy to some degree. Thus, we incorporate
a battery cycle life model into a profit maximization model to
determine the optimal bids in day-ahead energy, spinning reserve,
and regulation markets. Then a decomposed online calculation
method to compute cycle life under different operational strategies
is proposed to reduce the complexity of the model. This
novel bidding model would help investor-owned battery storages
better decide their bidding and operational schedules and
investors to estimate the battery storage’s economic viability.
The validity of the proposed model is proven by case study
results.
| Original language | English |
|---|---|
| Journal | IEEE Transactions on Smart Grid |
| Volume | 7 |
| Issue number | 5 |
| Pages (from-to) | 2359 - 2367 |
| Number of pages | 9 |
| ISSN | 1949-3053 |
| DOIs | |
| Publication status | Published - 2016 |
Bibliographical note
(c) 2016 IEEE. Personal use of this material is permitted. Permission from IEEE must be obtained for all other users, including reprinting/ republishing this material for advertising or promotional purposes, creating new collective works for resale or redistribution to servers or lists, or reuse of any copyrighted components of this work in other worksKeywords
- Battery cycle life
- Battery storage
- Optimal bidding strategy
- Performance-based regulation (PBR)
- Power markets
