Modelling the Market Impact of Energy Storage in Asia-Pacific Energy Markets
(Room Nile 1)
21 Sep 17
9:00 AM
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10:30 AM
Tracks:
Track E - Integration, Storage and Distributed Generation
Recent years have seen significant penetration of renewable generation in many markets. This has been driven by a combination of rapidly decreasing costs, environmental concerns and government policy. The intermittency of most renewable sources places greater demand on conventional thermal peaking generators to compensate and help maintain grid stability. Energy storage technologies, whether grid-scale or aggregated end-user storage, are an enabler for renewables integration, as well as providing support for the transmission and distribution systems. The cost of grid-scale and end-user energy storage is also decreasing rapidly, along a similar trajectory to that of renewable generation in recent history. Therefore, it is not unreasonable to expect significant penetration of storage technology in the grid in the future. This could occur both as grid-scale storage, and aggregated end-user (e.g. domestic) storage. This can be expected to occur within the economic lifetime of generation assets that are currently being planned, and could well happen within the lifetime of assets that are currently in service. What will be the impact of this on these assets? The complex interactions between storage and intermittent renewables, multiple types of conventional generation, transmission constraints and ancillary service requirements can lead to non-obvious energy market outcomes. In this paper, we present the results of simulations to forecast the impact of storage on several classes of conventional generation, in terms of market prices received, energy and reserve dispatch, and hence revenue and profitability. We present the results of this analysis across a variety of renewables and storage penetration scenarios and in a number of Asia-Pacific markets. From this, we draw out key risks and opportunities for energy market investors in the region.