Daily Episodic and Continuous Arbitrage Trading With Electric Batteries

Shujin Hou and Derek Bunn

The Energy Journal, 2024, vol. 45, issue 4, 179-194

Abstract: The business models for the operation of battery storage systems often depend substantially upon the revenues from arbitrage in the daily electricity wholesale market. Other revenue streams can be attractive, but even with them, wholesale market arbitrage is often used as the benchmark. There can be various trading policies for wholesale market arbitrage and this paper provides a comparison of three main variations. These are: day-ahead spread trading, day-ahead trading with look-ahead and intra-day continuously trading with look-ahead. The example is from the GB electricity market in which wind and solar generation as well as demand forecasts are used to forecast electricity prices. The results of the back-testing indicate the comparative attractiveness of day-ahead spread trading in terms of risk and return performance. JEL Classification: Q28

Keywords: electricity; batteries; spreads; trading (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/01956574241281143 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sae:enejou:v:45:y:2024:i:4:p:179-194

DOI: 10.1177/01956574241281143

Access Statistics for this article

More articles in The Energy Journal
Bibliographic data for series maintained by SAGE Publications ().