Optimizing the bidding strategy and assessing profitability of over-install renewable plants equipped with battery energy storage systems

Lysandros Tziovani, Lenos Hadjidemetriou and Stelios Timotheou

Renewable Energy, 2024, vol. 234, issue C

Abstract: The over-installation of renewable energy sources (RES) can enhance the profits of RES producers by increasing the total exporting energy; however, RES power curtailments must be applied under over-production of RES plants to ensure their contracted maximum export capacity limits. Battery energy storage systems (BESSs) can be used to reduce the RES curtailments and therefore enhance the profits of producers. This work develops a bidding strategy as a scenario-based stochastic optimization scheme to maximize the expected profits of producers in electricity markets considering battery degradation and maximum export capacity constraints. Using the proposed scheme, a financial analysis is performed to assess the profitability for over-installing hybrid RES plants by calculating the net present value and internal rate of return of the project under different BESS costs. Simulation results, using real data from a wind and photovoltaic plant, demonstrate the effectiveness of the proposed stochastic scheme in enhancing the profit of producers compared to the corresponding deterministic scheme. The performed financial analysis, using the net present value metric, indicates that a maximum over-installation of 150%–170% and 160%–180% for the wind and photovoltaic plant, respectively, is profitable, while the usage of a BESS is profitable when its cost is under 200,000 €/MWh.

Keywords: Battery degradation; Bidding strategy; Capacity-constrained RES sites; Overplanted hybrid RES sites; Photovoltaic power plants; Wind power plants (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0960148124013156
Full text for ScienceDirect subscribers only

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:eee:renene:v:234:y:2024:i:c:s0960148124013156

DOI: 10.1016/j.renene.2024.121247

Access Statistics for this article

Renewable Energy is currently edited by Soteris A. Kalogirou and Paul Christodoulides

More articles in Renewable Energy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().