Economic value of Li-ion energy storage system in frequency regulation application from utility firm's perspective in Korea

Title
Economic value of Li-ion energy storage system in frequency regulation application from utility firm's perspective in Korea
Authors
허원창
Keywords
energy storage system, economic value, utility firm, frequency regulation, ancillary services
Issue Date
2015-06
Publisher
ENERGIES
Series/Report no.
ENERGIES ; Vol8 no.6 Startpage 5000 Endpage 5017
Abstract
Energy Storage Systems (ESSs) have recently been highlighted because of their many benefits such as load-shifting, frequency regulation, price arbitrage, renewables, and so on. Among those benefits, we aim at evaluating their economic value in frequency regulation application. However, unlike previous literature focusing on profits obtained from participating in the ancillary service market, our approach concentrates on the cost reduction from the perspective of a utility firm that has an obligation to pay energy fees to a power exchange. More specifically, we focus on the payments between the power exchange market and the utility firm as a major source of economic benefits. The evaluation is done by cost- benefit analysis (CBA) with a dataset of the Korean market while considering operational constraint costs as well as scheduled energy payments, and a simulation algorithm for the evaluation is provided. Our results show the potential for huge profits to be made by cost reduction. We believe that this research can provide a guideline for a utility firm considering investing in ESSs for frequency regulation application as a source of cost reduction.
URI
http://www.mdpi.com/1996-1073/8/6/5000
http://dspace.inha.ac.kr/handle/10505/54665
ISSN
1996-1073
Appears in Collections:
College of Business Administration (경영대학) > Business Administration (경영학) > Journal Papers, Reports(경영학 논문, 보고서)
Files in This Item:
671_Economic value of Li-ion energy storage.pdfDownload

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