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Analyzing the potential economic value of energy storage
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Giulietti, Monica, Grossi, Luigi, Truillo-Baute, Elisa and Waterson, Michael (2018) Analyzing the potential economic value of energy storage. The Energy Journal, 39 (Special issue 1). pp. 101-122. doi:10.5547/01956574.39.SI1.mgiu ISSN 0195-6574.
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Official URL: https://doi.org/10.5547/01956574.39.SI1.mgiu
Abstract
This paper examines the commercial opportunities for electrical energy storage, taking market prices as given and determining the extent to which a strategy of arbitrage across the day, buying at the lowest price times at night and selling at the highest price times during the early evening, and relying on price forecasts one day-ahead generates profits in the British context. The paper sets out the potential problems as the market moves to absorb increasing amounts of wind, then characterises the nature of prices, which reveals the importance of a strategy in which power is absorbed into store for a relatively few hours of the day and discharged over a relatively few hours. It argues that additional incentives may need to be put into place in order to render storage over relatively longer periods more attractive and to deliver broader social benefits which are unlikely to be generated and captured as a result of purely commercial considerations.
Item Type: | Journal Article | ||||||||||||||||||||||||
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Subjects: | H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management H Social Sciences > HG Finance |
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Divisions: | Faculty of Social Sciences > Economics | ||||||||||||||||||||||||
Library of Congress Subject Headings (LCSH): | Arbitrage, Electric utilities -- Pricing -- Forecasting, Energy storage | ||||||||||||||||||||||||
Journal or Publication Title: | The Energy Journal | ||||||||||||||||||||||||
Publisher: | International Association for Energy Economics | ||||||||||||||||||||||||
ISSN: | 0195-6574 | ||||||||||||||||||||||||
Official Date: | 2018 | ||||||||||||||||||||||||
Dates: |
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Volume: | 39 | ||||||||||||||||||||||||
Number: | Special issue 1 | ||||||||||||||||||||||||
Page Range: | pp. 101-122 | ||||||||||||||||||||||||
DOI: | 10.5547/01956574.39.SI1.mgiu | ||||||||||||||||||||||||
Status: | Peer Reviewed | ||||||||||||||||||||||||
Publication Status: | Published | ||||||||||||||||||||||||
Access rights to Published version: | Open Access (Creative Commons) | ||||||||||||||||||||||||
Copyright Holders: | Publisher | ||||||||||||||||||||||||
Date of first compliant deposit: | 8 October 2018 | ||||||||||||||||||||||||
Date of first compliant Open Access: | 8 October 2018 | ||||||||||||||||||||||||
RIOXX Funder/Project Grant: |
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