Journal Article / Electricity
A Novel Business Model for Aggregating the Values of Electricity Storage
Electricity storage is considered as a valuable source of flexibility with applications covering the whole electricity value chain. Most of the existing evaluation methods for electricity storage are conceived for one specific use of the storage, which often leads to the conclusion that the investment on storage does not pay off. However, the value of storage cannot be properly estimated without taking into account the 2 possibility of aggregating the services that storage can offer to different actors. This paper proposes a new business model that allows aggregating multiple revenue streams of electricity storage in a systematic way. The main idea of the model is to coordinate a series of auctions in which the right to utilize the storage unit is auctioned upon different time horizons. The model consists of an optimization module and a coordination mechanism. The former simulates the optimal strategy of an actor to use the available storage capacities in a certain auction, while the latter ensures non-conflicting uses of storage by actors in different auctions. The functioning of the model is demonstrated by a case study. The results show that a storage unit can achieve higher return on investment in the manner proposed in the business model.