Opportunity cost modelling and market strategy of energy storage participating in the AGC market

doi:10.19799/j.cnki.2095-4239.2021.0581

Abstract

Abstract:

In the context of "Double Carbon," the penetration of renewable energy generation in the electricity grid is increasing. It advocates for increased AGC frequency control and reserve services requirements. As a newly emerging flexible resource, energy storage has great potential to provide ancillary services. Simultaneously, it faces a trade-off issue between the energy and ancillary service markets. In this context, an opportunity cost analysis approach for lithium battery energy storage in delivering AGC service is provided. An effective capacity allocation mechanism for energy storage between the energy and AGC markets is provided. Case studies reveal that the marginal opportunity cost of AGC capacity for energy storage increase with the growth of the declared AGC capacity. As a result, the return from energy storage is maximized when the marginal opportunity cost of AGC capacity equals the compensation price for AGC frequency control.

Key words: lithium battery energy storage, AGC frequency regulation, opportunity cost, energy market, market strategy

CLC Number:

TM 622

Yu SHI, Zhong ZHANG, Jingying YANG, Wei QIAN, Hao LI, Xiang ZHAO, Xintong YANG. Opportunity cost modelling and market strategy of energy storage participating in the AGC market[J]. Energy Storage Science and Technology, 2022, 11(7): 2366-2373.

Figures/Tables 8

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机组	最小出力/MW	最大出力/MW	二次费用函数系数			燃料价格/($/MBtu)
机组	最小出力/MW	最大出力/MW	a/MBtu	b/(MBtu/MWh)	c/(MBtu/MWh²)	燃料价格/($/MBtu)
G1	90	220	176.9	13.5	0.0004	5
G2	10	100	129.9	32.6	0.001	5.5
G3	10	20	137.4	17.6	0.005	5.2

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