A Novel Business Model for Aggregating the Values of Electricity Storage

Electricity storage is considered a valuable source of flexibility whose applications cover the whole
electricity value chain. However, most of the existing evaluation methods for electricity storage are
conceived for only one specific use of the storage, which often leads to the conclusion that the
investment on storage does not pay off. We think that the value of storage cannot be properly
estimated without taking into account the possibility of aggregating the services that storage can offer
to different actors. In this paper, we propose a new business model that allows aggregating multiple
revenue streams of electricity storage in a systematic way. The main idea of the business model is to
coordinate a series of auctions in which the right to utilize the storage unit is auctioned in different
time horizons. The model consists of an optimization module and a coordination mechanism. The
former simulates the optimal strategy of a certain actor using 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 a higher return on investment in the manner proposed in the business model.