Value of Storage for Renewable Portfolio Standard

TL;DR

This paper analyzes how storage systems can support high renewable energy penetration by balancing flexibility and arbitrage, highlighting the trade-offs and costs involved.

Contribution

It investigates the relationship between storage operation costs, capacity, and renewable penetration levels, revealing the value and costs of storage in renewable integration.

Findings

Storage provides flexibility for renewable integration.

High renewable targets increase storage-related costs.

Trade-offs exist between flexibility benefits and arbitrage costs.

Abstract

The ambitious targets for renewable energy penetration warrant huge flexibility in the power system. Such flexibility does not come free. In this paper, we examine the possibility of utilizing storage systems for achieving high renewable energy penetration, and identify the trade-off between providing flexibility and arbitrage against real-time prices. More precisely, we investigate the relationship among the operation cost, storage capacity, and the renewable penetration level. This illustrates the value of storage as well as the true cost induced by the high renewable penetration targets.