WG C5.25: Regulation and Market Design Barriers Preventing capture of all the Value from Fast and High-Location-Freedom Energy Storage.

Modern power systems are changing due to the rapid installation of large-scale renewable energy generation coupled with the evolution of new technologies.  New technical demands on the power system have highlighted the benefits that electrical energy storage systems can bring.  In order to ensure these systems are installed in a timely and economical manner, market systems can be used to drive the necessary investment.  However, most markets were not designed to deal with these new technologies and a number of regulation and market design barriers currently prevent the capture of all the value from them. WG C5.25 has recently produced TB 752, which examines this aspect in relation to fast and high location freedom energy storage.  Australian members on the WG were Ian Rose and Ben Vanderwaal.

TB 752 is the result of a collaborative work to identify regulation and market design barriers preventing full capture of the value from “new” energy storage technologies, which are faster and, unlike conventional power generation assets, have the ability to be installed almost anywhere on the grid. Examples of these storage technologies include electromechanical batteries, flywheels and electric vehicles.  The document calls these fast, high location freedom energy storage technologies or FLES.  A theoretical analysis of potential value streams in relation to FLES (both mature and evolving) and barriers to their implementation is presented, together with a practical inventory for 14 countries. The report notes that the aggregation of a large set of FLES and their use for multiple services will improve their economic viability.  A range of technically mature value streams are identified to support flexibility needs in relation to forecast balancing, real-time balancing, management of grid flows and emergency modes.  In addition, a number of future value streams are listed in relation to synthetic inertia (frequency rate of change), damping oscillations and synchronisation.   

Overall, the report outlines that most regulation and market design could be improved by following these four recommendations:

1. There should be a clear definition of the status of storage, either in relation to generation, consumption or both. The absence of status or an unclear status is inhibiting.

2. Ancillary services[1] should be defined in a market-based way without technological discrimination. Existing ancillary services should be opened to storage with no exclusivity for conventional generation. In addition, the mandatory provision of some services from conventional generation should be avoided.

3. In the context of system needs evolving towards faster system services, it is necessary to rethink the specification of existing ancillary services and consider new ones in order to take advantage of fast new storage technologies. For example, a power system with low inertia may consider faster frequency containment response than the service usually requested from thermal generation.

4. In order to take advantage of the congestion management capability of new high-location freedom storage technologies, the coordination of grid and flexibility resources, including storage, should be improved. In the case of separate entities’ operating network assets and storage assets, the interface between these entities should address both long-term risk (the congestion value collapses if the grid operator finally plans a grid reinforcement), and operational risk (the firmness of the availability and performance of the storage-based congestion service is critical for the grid reliability).

The Technical Brochure reference  TB 752 can be downloaded from e-CIGRE HERE and  is free to members and  €90  to non members.