Per-use-share rental strategy of distributed BESS in joint energy and frequency control ancillary services markets

Lingling Sun, Jing Qiu, Xiao Han, Xia Yin and Zhaoyang Dong

Applied Energy, 2020, vol. 277, issue C, No S0306261920311004

Abstract: The battery energy storage system (BESS) plays an increasingly important role in the electricity sector around the world. BESS can not only smooth the outputs of renewable energy, but also provide a variety of benefits to the electricity grid and markets. At this stage though, the capital cost of BESS is still high. Thus, the BESS sharing economy offers an opportunity to apply BESS services for customers. In this paper, the per-use-share rental strategy of BESS is proposed to support customers and increase the profit for the battery sales firm in the joint energy and the Frequency Control Ancillary Services markets. The rental pricing model is optimized for the firm and participating customers, and the proofs of the rental strategy are analyzed to assess its feasibility of the proposed rental strategy. The IEEE 33-bus distribution system is used to verify the proposed per-use-share rental strategy of BESS. The case studies use real historical data from the Australian Energy Market Operator. Moreover, the feasibility analysis of the per-use-share rental model is studied considering the fluctuations of clearing prices in the spot and Frequency Control Ancillary Services markets. The results show that the proposed per-use-share rental strategy of BESS provides a win–win situation for customers and the battery sales firm.

Keywords: Electricity markets; Battery energy storage system; Per-use-share rental business model; Sharing economy (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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DOI: 10.1016/j.apenergy.2020.115589

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