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Energies 2019, 12(6), 999; https://doi.org/10.3390/en12060999

Ageing and Efficiency Aware Battery Dispatch for Arbitrage Markets Using Mixed Integer Linear Programming

1
Department of Electrical and Computer Engineering, Technical University of Munich (TUM), 80333 Munich, Germany
2
Energy Research Institute @ NTU, Interdisciplinary Graduate Programme, Nanyang Technological University, Singapore 637371, Singapore
3
Department of Engineering Science, University of Oxford, Oxford OX1 3PJ, UK
4
Energy Technology Unit, Vlaamse Instelling voor Technologisch Onderzoek (VITO), Boeretang 200, 2400 Mol, Belgium
5
Energy Research Institute @ NTU, Nanyang Technological University, Singapore 637141, Singapore
6
School of Electrical & Electronic Engineering, Nanyang Technological University, Singapore 639798, Singapore
*
Author to whom correspondence should be addressed.
This paper is an extended version of our paper published in IEEE 18th International Conference on Environment and Electrical Engineering and 2nd Industrial and Commercial Power Systems Europe (EEEIC/I&CPS Europe), Palermo, Italy, 2018.
These authors contributed equally to this work.
Received: 15 January 2019 / Revised: 6 March 2019 / Accepted: 7 March 2019 / Published: 14 March 2019
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Abstract

To achieve maximum profit by dispatching a battery storage system in an arbitrage operation, multiple factors must be considered. While revenue from the application is determined by the time variability of the electricity cost, the profit will be lowered by costs resulting from energy efficiency losses, as well as by battery degradation. In this paper, an optimal dispatch strategy is proposed for storage systems trading on energy arbitrage markets. The dispatch is based on a computationally-efficient implementation of a mixed-integer linear programming method, with a cost function that includes variable-energy conversion losses and a cycle-induced battery capacity fade. The parametrisation of these non-linear functions is backed by in-house laboratory tests. A detailed analysis of the proposed methods is given through case studies of different cost-inclusion scenarios, as well as battery investment-cost scenarios. An evaluation with a sample intraday market data set, collected throughout 2017 in Germany, offers a potential monthly revenue of up to 8762 EUR/MWh cap installed capacity, without accounting for the costs attributed to energy losses and battery degradation. While this is slightly above the revenue attainable in a reference application—namely, primary frequency regulation for the same sample month (7716 EUR/MWh cap installed capacity)—the situation changes if costs are considered: The optimisation reveals that losses in battery ageing and efficiency reduce the attainable profit by up to 36% for the most profitable arbitrage use case considered herein. The findings underline the significance of considering both ageing and efficiency in battery system dispatch optimisation. View Full-Text
Keywords: efficiency; storage; battery ageing; arbitrage; market; optimisation; mixed-integer-linear-programming; piece-wise affine approximation; utility-scale; frequency regulation; primary control reserve; lithium-ion efficiency; storage; battery ageing; arbitrage; market; optimisation; mixed-integer-linear-programming; piece-wise affine approximation; utility-scale; frequency regulation; primary control reserve; lithium-ion
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This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).
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Hesse, H.C.; Kumtepeli, V.; Schimpe, M.; Reniers, J.; Howey, D.A.; Tripathi, A.; Wang, Y.; Jossen, A. Ageing and Efficiency Aware Battery Dispatch for Arbitrage Markets Using Mixed Integer Linear Programming . Energies 2019, 12, 999.

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