Development of Business Models for Electrical Energy Storage in Europe - Techno-economic evaluation of combining storage services

Abstract: Europe aims for a transition towards less greenhouse gas emission and dependency on fossil fuels. The integration of intermittent renewable energy sources, as wind or solar power, can be facilitated by, among others, temporally decoupling demand and supply of electricity. If technologies for electrical energy storage are profitable, wide implementation could support the transition. Therefore, this study assesses the revenues and costs of long-term storage technologies and evaluates the possibility to stack several services provided by a storage unit to fully utilise it. Key market characteristics influential on storage potential are outlined and used to classify and compare the demand for storage in European markets. Considering them market clusters are formed comprising of countries with similar electricity market and from these two contrasting archetypal countries are chosen for further evaluation, Sweden and Germany. Storage technologies, as pumped hydro or compressed air, are delineated by essential technical specifications and used to determine the compatibility of them to corresponding services. A process for combining multiple services for a single storage unit is designed and employed to develop five cases. The results show that providing multiple services device can improve the profitability of the designed business cases by generating multiple revenue streams and increase the value to the electricity system. The stacking also minimises the storage’s idle time. Furthermore, the results demonstrate the influence of the key characteristics on the economic viability of the electrical energy storage in European markets.