Strategic Guidelines for Battery Energy Storage System Deployment: Regulatory Framework, Incentives, and Market Planning

Roberto Dias Filho (), Amanda C. M. Monteiro, Tatiane Costa, Andrea Vasconcelos, Ana Clara Rode and Manoel Marinho
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Roberto Dias Filho: Escola Politécnica, Universidade de Pernambuco—UPE, Recife 50720-001, Brazil
Amanda C. M. Monteiro: Edson Mororó Moura Institute of Technology—ITEMM, Recife 51020-280, Brazil
Tatiane Costa: Edson Mororó Moura Institute of Technology—ITEMM, Recife 51020-280, Brazil
Andrea Vasconcelos: Edson Mororó Moura Institute of Technology—ITEMM, Recife 51020-280, Brazil
Ana Clara Rode: AES Brasil, São Paulo 04578-000, Brazil
Manoel Marinho: Escola Politécnica, Universidade de Pernambuco—UPE, Recife 50720-001, Brazil

Energies, 2023, vol. 16, issue 21, 1-22

Abstract: This research addresses strategic recommendations regarding the applications of battery energy storage systems (BESS) in the context of the deregulated electricity market. The main emphasis is on regulatory dimensions, incentive mechanisms, and the provision of marketable storage services. The study’s findings demonstrate that battery energy storage systems (BESS) have distinct characteristics that challenge their conventional classification as a load or generator within power systems. The study additionally emphasizes the insights, lessons learned, and good practices gained from early adopter countries in implementing energy storage systems (ESS). These insights include the importance of establishing a precise definition of ESS, promoting collaborative engagement with relevant stakeholders, and developing a series of incentive strategies. The results show that nations that pioneered BESS’s application in their electricity matrices have effectively promoted storage services in deregulated markets, employing storage assets for various purposes such as peak reduction, frequency regulation, renewable energy support, and energy arbitrage applications. These applications underline the potential of BESS to increase grid stability and minimize exposure to risk and volatility in the revenues of storage agents in deregulated markets.

Keywords: ESS; BESS; storage; regulatory framework; incentives; deregulated energy market (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2023
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