Cost-Benefit Analysis of Li-Ion Batteries in a Distribution Network

Abstract

The paper is focused on economic feasibility analysis of battery energy storage providing load shifting to the end-user. Electro-chemical storage technology is considered, as it is envisioned to play an important role in future power systems by reducing costs, deferring investments and increasing reliability of system operation. In the study, cash-flows arising from battery investment and operation in a representative distribution grid are considered for a planning period of 33 years. Forecasting methodology based on Fourier transform for the hourly electricity market price is proposed and performed for a particular bidding area of the Nord Pool day-ahead market. Results of the case study demonstrate that with the current trends of market price and tariff structure of electricity paid by the end-users, investments in BESS may not be profitable and some additional incentives should be introduced.