Energy storage for decentralized renewable energy generation to mitigate connection scarcity on the MV-grid

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Abstract

The goal of this research is to be used as a framework for adding energy storage to aid in the connection of decentralized renewable energy generation in areas with limited connection availability to the electricity grid. The dependence on fossil fuels is reduced with the aim to reduce greenhouse gas emissions. In the Netherlands this means that natural gas is slowly faded out of our society. One consequence of this is the electrification of some functionalities that natural gas had, like heating houses and cooking. Additionally, more and more people are choosing to drive electric vehicles. On the supply side more and more renewable energy sources are being installed to increase the renewable energy mix in our electricity market. Because the supply and demand of electricity increases faster than new cables can be installed, the electricity grid is put under strain. The electricity grid was designed, decades ago, to only transport electricity from central, large energy generation plants to the consumer. However, nowadays there are also developers that are building 'decentralized' PV parks and wind farms. These decentralized generation systems are unable to be connected to the MV-grid. Energy storage has been identified to be a valuable asset to help with the penetration of renewable energy. Energy storage can help to match the supply and demand, improve the power quality, improve the variability of the power supply and smooth out the peaks of over-generation most associated with the congestion on the MV-grid. It is also possible to (temporally) replace the necessary grid reinforcement. However, energy storage is still very expensive. So it needs to be examined how energy storage can be interesting for this problem. A knowledge gap exist on energy storage for decentralized renewable energy generation for the Dutch medium-voltage grid. Additionally, no method was available to simulate such an problem. So this was researched in this study. The study has included a suitable financial model, various energy storage systems and operating strategies. Additionally, the interest of the developer of the DG plant and the DSO were included. For the developer the study has investigated the profitability of the system. The DSO is interested in minimizing the cost and resources of the connection of the hybrid DG system. From this the following research questions are formulated: Under what conditions can energy storage for decentralized renewable energy generation be economically feasible to mitigate connection scarcity on the medium-voltage grid? This was answered in three steps. Firstly, a model was built to accurately simulate energy storage in a hybrid DG system. This model must satisfy all technical requirements and be applicable to the Dutch electricity markets. Secondly, the simulation model was used to examine the hybrid system design to optimally profit from the storage system. From this it was concluded that a small energy storage system adds relatively more value in energy output and earnings than a large storage system. Additionally, it identified the pumped heat electrical storage system as the most profitable system for decentralized generation and the best performing technology is the LFP Li-ion battery. Also, storage is more beneficial for PV solar energy than for wind energy. In this section it was also found that in alleviating connection scarcity, grid reinforcement is more profitable than energy storage. And thirdly, different operating strategies for the hybrid system were investigated to optimally use the energy storage system. For a hybrid system with cable capacity limitations, peak shaving of over-generated energy is the most profitable operating strategy. This research has shown that energy storage can improve the energy output and revenue of a decentralized system with connection capacity limitations. Nevertheless, not adding energy storage is more profitable. A small energy storage system with a PV solar park can become economically feasible and more interesting than grid reinforcement. For this, energy storage technologies need to improve, especially the capital cost need to reduce, with more than half of the current cost. Additionally, this hybrid system needs to be located where grid reinforcement is costly or not possible.