The document summarizes a study on the techno-economic analysis of energy storage technologies in Alberta, Canada. It analyzed the value of battery, compressed air energy storage (CAES), and power-to-gas technologies at two wind farms. The study found that energy storage increased wind farm revenues in all cases and provided more benefits to the more intermittent wind facility. There were also trade-offs between participating in energy markets as a merchant case versus behind-the-fence case.

1. Techno-economics of Energy
Storage
Puneet Mannan
Grid Resilience through Energy Storage in
SW Ontario
November 20, 2013
puneet.mannan@albertainnovates.ca
780 450 5380

2. The Study Objective
 Advance the techno-economic understanding of
select energy storage technologies in the Alberta
context
 Provide some measure of quantification of the
value of Power-to-Gas (PtG), battery and
Compressed Air Energy Storage (CAES)
technologies in the Alberta electricity market

3. Selection of Technologies
 Reasonably mature for grid scale
implementation, cover a broad range of technical
and operating constraints
 CAES
 System components generally mature; exposure to
Natural Gas prices
 Sodium-Sulphur (NaS) Batteries
 Relatively small-scale; exhibits asymmetry in parasitic
loads
 Power-to-gas (PtG)
 Complex operation; multiple value propositions;
varying technical maturity

4. Selection of Wind Farms
 Represent wind farm from
north of Pincher Creek area
 Wintering Hills
 Castle River
Castle River
Wintering Hills

5. Buy/Sell Decision Criteria
 Switch price
 Each hour of the year
 Inventory level, current average cost of inventory, and
variable operating cost
 Inventory ↓, switch price ↑ to a max. limit
 Inventory ↑, switch price ↓ (subject to a min. limit
= sum of inventory + variable cost)

6. Modelled Cases
Base Case
Merchant
Wind Power
Generator
Behind-the-Fence
Merchant
Operator
Battery CAES
Power-
to-Gas
1
Battery CAES
Power-
to-Gas
1
Power-
to-Gas
2
Power-
to-Gas
2

7. Wind Facilities – Monthly Output
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
January March May July September November
ElectriictyOutput(MWh)
Wintering Hills Castle River
Wintering Hills Normalized Castle River Normalized
Wintering Hills Castle River
Capacity Factor 37.9% 32.3%
Capacity 88 MW 39 MW
Zero Hours 1046 2288
Source: Natural Resources Canada
Castle River
Wintering Hills

8. Results
$-
$50
$100
$150
$200
$-
$500
$1,000
$1,500
$2,000
January March May July September November
MonthlyAveragePrice($/MWh)
MonthlyRevenue($Thousands)
Wintering Hills Battery
Average Hourly Price Base Case Revenue Behind-the-Fence Reveue Merchant Revenue
$-
$50
$100
$150
$200
$-
$500
$1,000
$1,500
$2,000
January March May July September November
MonthlyAveragePrice($/MWh)
MonthlyRevenue($Thousands)
Castle River Battery

9. Results
 Energy storage increases the wind facility
revenues in all cases.
 On a percentage basis, the more intermittent
wind facility benefits more from energy storage
 Seven hours of energy storage capacity is not
optimal.
 There are trade-offs associated with participation
in the OR markets; however, there is additional
value.

10.  Thank you
 Questions welcome

11. Market Price Adjustment
The market price adjustment
mechanism:
• Adjusted the market price for
the effects of:
o buying grid electricity –
Merchant cases
o selling stored energy –
Merchant and Behind-the-
Fence cases
• Reduced the overall market
revenues by about 13 per cent
• Average adjusted market price
was about $2.00/ MWh lower
than the actual historical
average.

12. Comparison: October 22 - 24
-40
-20
0
20
40
60
80
100
$(400)
$(200)
$-
$200
$400
$600
$800
$1,000
8 9 101112131415161718192021222324 1 2 3 4 5 6 7 8 9 101112131415161718192021222324 1 2 3 4 5 6 7
Electricity(MWh)
HourlyPrice(4/MWh)
-40
-20
0
20
40
60
80
100
$(400)
$(200)
$-
$200
$400
$600
$800
$1,000
8 9 101112131415161718192021222324 1 2 3 4 5 6 7 8 9 101112131415161718192021222324 1 2 3 4 5 6 7
Electricity(MWh)
HourlyPrice($/MWh)
Hour Ending
Delivered to the Grid - BTF Delivered to the Grid - Merchant Hourly Price Wind Output
Wintering Hills
Castle River

13. Methodology
 Hindcast model incorporated
 Actual wind facility production data
 Actual market prices
 Operating parameters and limits for energy storage
technologies
 Market clearing prices were adjusted for the
effects of the storage operation
 Two dispatch strategies were modelled
 Behind-the-Fence
 Merchant

14. Operating Configuration
Behind the fence storage Merchant operation storage
Energy storage operation is co-
located with a wind farm
Energy storage entity that is
independent of the wind farm
Buys electricity only from that wind
farm
Buys electricity from a wind farm or
from the grid
Uses electricity price arbitrage or
other market opportunities for
storing and selling electricity (or
hydrogen)
Uses electricity price arbitrage or
other market opportunities for
buying, storing and selling electricity
(or hydrogen)
Pay only DTS according to existing
AESO rules
Pays STS and DTS according to
existing AESO rules