Grid Connected Large-Scale Energy Storage

Grid connected large-scale energy storage Literature review regarding present technology and application, with a complementary case study that investigates the profitability of storage within a wind farm

Per Skoglund

Master of Science in Energy Engineering, 300 hp Master thesis, 30 hp EN1729

Abstract In the transition from traditional power plants to more environmentally friendly alternatives will generate a need for more flexibility in production, transmission and consumption. Energy storage can be provide the flexibility that are required to continue to have a robust and stable electrical system. The purpose of this report is to give an overview of the electrical energy storage technologies. The classification of energy storage technologies used in this report is mechanical, chemical and electrical. In these three categories were ten different technologies presented with function, advantages, disadvantages, degree of maturity and research area for each technology. The distribution between the globally operational energy storage technologies were presented. Also the framework and regulations for actors to own and operate an energy storage in Sweden. This review was complemented with a case study about connecting a lithium ion battery system to a wind farm. The case investigated the profitability for 20 MW wind farm with a 12 MW and 18 MWh energy storage system for a five and ten-year period. The utilization of the storage was optimized with What’s best for three different investment cost. The review were done in order to answer: what is the futures energy storage technology?, what applications can be replaced by energy storage for an electricity producer? and what will the effects be of the new actor Aggregator? The result from comparing three different prices for lithium ion batteries resulted in a non-profit scenario for all the cases in a five-year period. There were a maximum, minimum and predicted futuristic price, which generated a loss of 731, 220 and 76.6 MSEK for respective case. Only the futuristic price for a ten-year period indicated an profit. The conclusion that can be drawn from this case study is that energy storage is too expensive and the extra income from utilization of the energy storage is not enough to motivate an energy storage investment. There are not a single technology that possesses all of the required properties for the applications. In the future there will be a combination of technologies to cover all the applications. For the seasonal storage pumped hydro and compressed air are most promising technologies. The flywheels and supercapacitors can contribute with short powerful burst of energy that are needed for power quality and operating reserves. For the more wide range application such as power fleet optimization and integrate the renewable energy production, batteries in form of lithium ion battery and sodium-sulfur battery will most probably be used. For electricity producers energy storage can replace existing solutions. Instead of using diesel generators for black start services, an battery can be used. Also the power quality could be enhanced with batteries acting as filters. The process can be more utilized in a more efficient way with an energy storage. The aggregator actor gathers small variable load from e.g several houses and participate on the electricity market. This actor will level out the differences in power demand during the day. It will reduce the losses and reduce the need for grid investments in both the transmission and distribution networks. It would also generate more available frequency reserves and probably change how the market is paying for the generated benefits.

i Sammanfattning I en övergång från konventionellt planerbar elproduktion till ett elsystem med en hög andel intermittent, väderberoende elproduktion uppkommer ett nytt behov av flexibilitet i produktion, överföring och konsumtion. Energilager kan utgöra en viktig del av den flexibilitet som krävs för ett fortsatt robust och stabilt elsystem. Syftet med examensarbetet är att ge en överblick över de tillgängliga elektriska energilagringsteknikerna. Energilagringsteknikerna är kategoriserade utifrån hur de lagrar energin, mekaniskt, kemiskt eller elektriskt. I de här tre kategorierna presenteras tio teknikers funktion, fördelar, nackdelar, mognadsgrad och forskningsområden. Fördelningen mellan den globalt operativa energilagringstekniken med avseende på effektkapacitet presenteras samt de lagar och förordningar som gäller i Sverige för de olika aktörerna. Sammanställningen komplimenterades av en fallstudie där ett litium-jonsystem placerades inom en 20 MW vindpark. Fallstudien undersökte lönsamheten för ett batteri på 12 MW och 18 MWh för en fem- samt tioårsperiod. Användningen av energilagret optimerades med What’s best för tre olika investeringskostnader. Sammanställningen genomfördes för att svara på följande frågor. Vilken är framtidens energilagringsteknik?, Vilka användningsområden kan energilagring användas till för elproducenter? och Vilka effekter kommer den nya aktören aggregator att medföra? Resultatet från fallstudien visar att de tre investeringskostnaderna för litium-jonbatterierna resulterade i bristande lönsamhet för femårsperioden. Det var ett maximalt pris, minimalt pris samt ett futuristiskt pris och alla resulterade i en förlust för 731, 220 och 76.6 MSEK för respektive fall. Dock indikerades en lönsamhet med ett futuristiskt batteripris för en tioårsperiod. Fallstudien fastslog att energilagring är för dyrt och de extra inkomsterna som fås genom användningen av det inte är tillräcklig för att motivera en investering. Det finns inte en teknik som besitter alla nödvändiga egenskaper för att täcka in samtliga användningsområden. I framtiden kommer det vara en kombination av tekniker som tillsammans täcker in alla användningsområden. För säsongslagring kommer troligen pumpkraftverk och tryckluftslagring att användas. För de kortare och mindre pulserna av energi som krävs för frekvenshållning och elkvalité kommer troligen svänghjul och superkondensatorer att användas. För de mer övergripande användningsområdena som att integrera förnyelsebar produktion och för att optimera produktionen kommer litium jon och natrium-svavel batterier troligen att användas. För elproducenter kan energilagringen ersätta befintliga lösningar. Istället för att använda dieselgeneratorer som reservkraft, skulle man kunna använda batterier. Man skulle även kunna köra processen mer optimalt med ett energilager. Aggregatorn samlar små variabla laster för att medverka på elmarknaden. Aktören kommer troligtvis bidra med minskade effekttoppar och en mer jämn fördelning av effektuttaget från nätet. Det kommer att resultera i minskade överföringsförluster och minskat behov av investeringar för transmissions- och distributionsnätet. Det kommer också finnas flera effektreserver för frekvenshållningen samt att prissättningen av de andra fördelarna med energilagringen kommer troligen att förändras.

ii Preface and acknowledgment This master thesis of 30 hp completes my studies for the degree Master of Science in Energy Engineering at the department of Applied Physics and Electronics at Umeå University. The work was done with Pöyry Sweden AB during the period 2017-01-16 to 2017-06-04. First I want to thank my supervisor at the university Jan-Åke Olofsson. I also want to thank Mats Wang-Hansen who was my supervisor at Pöyry for interesting discussions and guidance. I’m grateful to the publishers American Association for the Advancement of Science (AAAS) and Luo, Xing who gave me permission to use their ﬁgures.

Umeå, May 2017 Per Skoglund

iii Contents

1 Introduction 1 1.1 Purpose ...... 1 1.2 Research questions ...... 2 1.3 Methods ...... 2 1.4 Delimitations ...... 2

2 The electrical grid 3 2.1 Electricity market ...... 3

3 Framework and regulations for owning and utilization of energy storage 5 3.1 Grid owner ...... 5 3.2 Electricity producer ...... 6 3.3 Third party ...... 6

4 Electrical energy storage technologies 8 4.1 Mechanical ...... 8 4.1.1 Pumped hydro storage ...... 8 4.1.2 Compressed air storage ...... 10 4.1.3 Flywheel energy storage ...... 11 4.2 Chemical ...... 12 4.2.1 Lead acid batteries ...... 13 4.2.2 Lithium ion battery ...... 14 4.2.3 Sodium-Sulfur batteries ...... 15 4.2.4 Redox Flow battery ...... 17 4.2.5 Hydrogen storage with fuel cell ...... 18 4.3 Electrical ...... 19 4.3.1 Capacitors and supercapacitor ...... 19 4.3.2 Superconducting magnetic energy storage ...... 20

5 Operational power and degree of maturity of present energy storage technologies 21

6 Energy storages applications 23

7 Energy storage cost breakdown 27

8 Summary and future trends for the energy storage technologies 28

9 Case study 30 9.1 Method ...... 31 9.2 Results ...... 33 9.3 Discussion ...... 36

iv 9.3.1 Method ...... 36 9.3.2 Results ...... 37 9.4 Future work ...... 39

10 General discussion 40

11 Conclusions 42 11.1 Case conclusion ...... 42

References 43

A Tariﬀs A.1

B Battery prices B.1

C Annual cycles C.1

v 1 Introduction The entire energy sector is without a doubt dependent of fossil fuels but more environmentally sustainable options are advancing in the shape of renewable energy. The global investments in renewable energy 2015 were $285.9 billion, which is the highest annual investment so far [1]. The traditional energy sources are more versatile and more controllable, while energy production from renewable energy such as wind and solar power coincide more with the local weather. A problem with electricity is that in the same moment it is produced it must be consumed. Therefore it must exist a balance on the electrical grid, otherwise the frequency will change. When more renewable power is integrated in the system there will be more problems with the frequency. So the renewable power systems are in need of a way to control the power generation in order to reduce the weather dependency. The renewable could be installed with complementary energy storage. The way of controlling the power generation for the traditional sources is by feeding in more fuel. So in some sense the fuel for nuclear, fossil and hydropower are a type of energy storage. Energy can be stored in different forms such as latent and sensible heat, kinetic energy, chemical energy and in an electrical field [2]. Well known portable solutions for energy storage is electrical vehicle or in small electronics. These are portable solutions with different purposes. For the electric vehicle is a more environmental friendly substitute to the classic petrol and diesel car, while the electronics is often suppose to be compact and site independent such as mobile phones. For this applications properties like high energy density and reasonable operation temperature is desired. There are interests in more stationary solutions. From a consumer perspective, energy storage can serve several purpose. One application where the surplus electricity generated from their own micro production is stored and sold when the electricity price is higher or used when it is needed. This energy storage application is refereed to as load shifting. In an electrical network perspective energy storage has several potential applications such as reducing peak load demand, postpone grid investments, frequency regulation and integrating renewable energy sources [3]. Electrical energy storage has several applications and provides solutions to many problems. “Limitations on the grid have made it look like renewables are a problem, but the grid was never designed for them and it needs to be,” says Kamath [4]. The limitations on the grid can be solved with energy storage that can postpone investment in cables, transformers, reducing the dependency of fossil fuel and optimum utilization of the traditional power plants [5].

1.1 Purpose Transition from traditional power plants to more environmentally friendly alternatives will generate a need for more flexibility in electricity production, transmission and consumption. Energy storage can provide the flexibility that are required to continue to have a robust and stable electrical system. The purpose of this thesis is to give an overview of the present electrical energy storage technologies. The thesis will also investigate the profitability for a large-scale lithium ion battery system. There will be three different investment prices for the lithium ion battery and the storage will be placed within a wind farm.

1 1.2 Research questions The following questions will be answered in this thesis: • Which energy storage technologies will be most promising in the future? • What potential applications for energy storage are available for electricity producers? • What eﬀects does a new actor, so-called aggregator, have on the Swedish electricity market?

1.3 Methods This thesis is divided into two parts. The first part is a literature review, where the function, applications and maturity for different energy storage technologies will be discussed. The information will be collected from reports, books and recent scientific publications. The second part is a case study where energy storage will be evaluated for different investment price. The storage utilization will be optimized with What’s Best, which is an addon to Excel developed by Lindo systems, for an economical objective function. This objective function consists of the income from utilization energy storage and the cost for the storage system. This plug in was used because of the vast use of Excel.

1.4 Delimitations Energy storage can be divided into two main branches, one for thermal storage and one for electrical storage. This thesis will only focus on the electrical storage and leave out everything regarding thermal energy storage. The energy storage applications and techniques for all types of electric vehicles will be excluded in this report. The small-scale energy storage in electronics, are also excluded in this report.

2 2 The electrical grid The power system is divided into three categories: generation, transmission and distribution. The generation of power came mainly from hydropower (39%) and nuclear power (39%) in Sweden 2016. This energy sources can be controlled by operator’s [6]. The operators are obligated to follow the regulations, which the transmission system operator (TSO) decides. The TSO in Sweden are Svenska kraftnät (SvK), they are owned by the state, and their responsibility is to maintain a balance between the consumption and generation. If there is an imbalance at any time the frequency will ﬂuctuate. In Sweden the frequency is 50 ± 0.1 Hz and if it deviates from the allowed interval an automatic energy reservoir will start [7]. The reservoirs are power plants, usually hydro power plants, that are loaned to Svk for regulating the frequency. Nuclear and hydropower are complemented by combined heat and power plants (CHP) (9%) and wind power (9%), which is often regional located (in the distribution network) [6]. Since wind power is a non-dispatchable energy resource, a distribution system operator (DSO) needs to balance the diﬀerence between actual generation and predicted generation with power from a CHP plant or hydro plant. The Swedish grid have three hierarchical voltage levels national grid (400 kV - 220 kV), regional grid (130 kV - 40 kV) and local grid (10 kV - 400 V). SvK owns the national grid (transmission network) and the electricity is transferred from the major power stations to the consumers via the regional network and local network. The regional grid is owned by several large electricity companies, while local utility companies own the local grid. The network owner has monopoly on their geographical area, since it is highly expensive to build and maintain the network [8]. This monopoly comes with a few requirements such as the network should be available to all electricity producers and consumers in a non-discriminating way. They are obligated to connect all the costumers/producers to the grid without barriers [9].

2.1 Electricity market In 2010, the European commission decided that Sweden needed to change their way of handling weak spots in the national grid. Their current model was violating the Free Trade Agreement. Therefore 2011, SvK divided Sweden into four electricity areas: Electricity area Luleå (SE1), electricity area Sundsvall (SE2), electricity area Stockholm (SE3) and electricity area Malmö (SE4). The boarders between the electricity areas are due to weak spots in the national network [10]. Most of Sweden hydropower is generated in SE1 and SE2, where 12 % [11] of the people live. Hence, generally SE1 and SE2 have an excess of energy while SE3 and SE4 have a shortage. This results in diﬀerent electricity prices in the electrical areas.

3 The generated electricity is sold to the costumers through electricity trading companies. The trading companies often buy their electricity via Nord pools power market [12]. The trading companies can also buy directly from the producers without Nord pool. Nord Pool are owned by the TSO’s of Sweden, Norway, Finland, Danish, Estonia, Latvia, and Lithuania and they oﬀer a day-ahead trading and intra trading possibilities on an hourly basis. The day-ahead trading is where the bulk energy is bought for every hour the next day. The price is determined by an intersection between the entire surplus and demand bids, while the intra trading complements the day-ahead [13]. So the companies have a chance to correct the amount of energy needed to maintain a balance before the TSO’s do their balancing measurements [14]. As mentioned earlier SvK has a main purpose to reduce imbalances in the network. Therefore, SvK make agreements with a company at every feeding point so the balance responsibility is transferred down to the origin of the problem. This company can be an electricity producer or/and third party that are allowed to trade at Nord pools market. One of the tasks for the balance responsibility company is to continuously plan for a balance on an hourly basis. If there are imbalances, the balance responsibility company have to pay a fee to SvK, since SvK must either generate more or less power from their reservoirs depending on the frequency deviation [15]. This fee is explained in section 9.1. There are two Frequency containment reserves (FCR): normal and disturbance. The normal reserve is automatically activated when the frequency is deviating from 50 Hz, but are inside the interval ± 0.1 Hz. The disturbance reserve also activates automatically when the frequency deviation is larger than ± 0.1 Hz. There are manually reserves that are utilized under extreme power demand. These reserves both automatically and manually are sold to SvK from the electricity producer’s [7].

4 3 Framework and regulations for owning and utilization of energy storage The EU member countries decide what and how the collaboration should work and it is written down in treaties. The original idea was to obtain a system were the members could trade without customs duty and other economical barriers [16]. EU has exclusive competence in some subjects such as trading policy. That means that all the member countries must follow the decisions EU makes. There are also subjects that EU cannot affect the regulations for the members such as education system, health care and culture. But there are subjects that both EU and the members can decide so-called shared competence. The countries set their own laws and regulations, but when EU decides something in that subject the national law do not apply anymore. The subjects with shared competence are for example the environment, asylum policy and energy [16]. The Swedish Electricity Act (1997:857) with complementary regulations defines what is allowed and not on the Swedish electricity market. The Electricity act consists of 13 chapters, that addresses topics regarding network operation, network tariffs and supervision [17]. The Electricity Act does not have any specific definition for what an energy storage unit is. From a system perspective the act does not distinguish a trading company or an electricity production facility with energy storage, since energy storage is both an input and withdrawal point. Therefore the energy storage can be utilized for different purposes with respect to the owner [18]. In the sections below the different actors ability to own and operate an energy storage are evaluated regarding to the Swedish Electricity Act.

3.1 Grid owner As aforementioned the grid owner has monopoly on a geographical area and is not allowed to trade on the Nord pool’s market. They are obligated to connect all costumers/producers to the grid in a non-discriminating way without any barriers. Therefore their revenue cap are regulated by an authority called Swedish Energy Market Inspectorate, that specifies it for a four-year period. The companies operating cost and their total value of components determine the revenue cap. So from the revenue cap the maximum profit is stated and hence the tariffs price decided. The grid owners can purchase different services from a third party that owns the energy storage instead of owning it themself [18]. The grid owners are allowed to buy electricity from the energy storage, but it is not allowed to sell electricity to it. The electricity must be bought from Nord pool or from an electricity producer to charge the energy storage [18]. In the Electrical Act chapter 1, 4§ "Network operation also includes planning and design, building and maintenance of cables, switchgear and transformer stations, connection of power installations, metering and computation of capacity and energy transmitted and also other operations that are necessary to transmit electrical power within the electricity network." [19]. Hansson et al. concluded that "other operation" could contain owning and operating an energy storage in order to maintain the grid online [20]. Further from the Electrical Act chapter 3 section 1a: "A legal person who conducts a network operation can not conduct the generation of or trade in electrical power." [19].

5 With the following exceptions: "(i) is exclusively intended to cover network losses, or (ii). Is conducted temporarily with the aim of replacing a shortfall in electricity in conjunction with a power outage." [19]. In order for the energy storage to be discharged, it needs to be charged at sometime. Hansson et al. also pointed out that the Electrical Act does not specify if the electricity must be traded momentarily when reducing the transmission losses [20]. So the electricity could be bought when the price is low and stored until it is needed. This could result in an operational cost reduction and not necessarily a reduction of the electrical losses due to conversion losses. Their revenue cap will be aﬀected since the operational costs are decreasing. The losses are calculated from the electricity measurements equipment at the power generation and at the consumer. Hence it contains transmission losses and charge/discharge losses via the energy storage [20]. To summarize, the grid owner can own and operate an energy system in order to reduce transmission losses and temporarily replace electricity in case of a power failure. Hansson et al. stated that the proﬁt from utilization of an energy storage is probably not enough to validate an investment [20].

3.2 Electricity producer As mentioned earlier the Electric Act does not distinguish an electricity production facility from energy storage. Electricity producers are allowed to trade on Nord pools market and hence profit from the fluctuation prices. The electricity transports from the power production site via the network into the storage when it is charged and in a corresponding manner when the storage is discharged. From chapter 4 §1, "Network tariffs shall be objective and non-discriminatory", this means that all costumers must be equally treated. Therefore, the Act considers an energy storage as one consumer and one producer. This results in a double network fee for the electricity producer, one to charge the storage and one for discharging the storage [21]. Hansson et al. noted that if the producer also consumes electricity an electrical fee is added on the stored energy and on the losses due to conversion and distribution of the electricity [20].

3.3 Third party A third party is neither an electricity producer nor the grid owner; it could be a company that is interested in proﬁting from the electricity market. The same reasoning regarding the two fees and selling services to the grid owner applies to a third party as for an electricity producer. A relatively new third party is called "Aggregator". This new actor does not participate on the Swedish electricity market. The main idea is to gather all variable loads and sell as a single resource [22]. The aggregator could gather an intermittent production company such as solar or wind. It could also be households that have a variable load due to solar cells with some complimentary energy storage. This energy storage could be stationary batteries or batteries in an electrical vehicles. The aggregator could own an external energy storage as a third party.

6 Pia Borg concluded that there aren’t any fundamental barriers for aggregator to participate on the electricity market [18]. Therefore, the aggregator could benefit from the fluctuating electrical prices. Since the aggregator members have a variable load, the aggregator could offer a service called Demand and response. This service is to sell a reduced consumption [18]. For example, the households can be compensated for reducing their energy consumption at peak loads. Hansson et al. noted a complication regarding the balance responsibility. We assume that the aggregator’s users can buy electricity from producers on an intra day basis. The aggregator then place an offer on the day-ahead market and the offer gets accepted. The offer is to reduce the consumption for the aggregator’s users, while the users purchase electricity from the producer that have the balance responsibility on the intra-day market. A deviation from the planned consumption will occur and the balance responsibility party will be obligated to pay a fee to SvK [20]. Because SvK will probably act on the imbalance between planned and production. A test project with an aggregator was conducted in Germany 2015. There were a conjunction between several companies: N-ERGIE, TenneT TSO, Saft Batterien, Siemens and Caterva. The network’s purpose was to supply a resource to the frequency reserve in Germany. The requirements were, to be able to act within 30 seconds and supply a constant power output for at least 15 minutes [23]. The network consisted of 65 households with solar cells and lithium-ion batteries. The batteries could generate 20 kW and store 21 kWh each. This battery investment resulted in that the households covered 60-80 % of their energy demand and also contributed to the FCR [24]. To summarize, a third part can own and operate an energy storage while also participate on the electricity market. If the owner consumes electricity, an electricity fee will be added for the stored energy and losses. The profit for the energy storage will be determined by the combined cost from the charge and discharge network tariffs, fees on the stored energy and the compensation for the services provided [21]. Pia Borg concluded that there are insufficient experience regarding the balance responsibility and selling services from an aggregator actor to rule out if there exists any barriers to a cost effective network operation [18].

7 4 Electrical energy storage technologies The energy storage is charged with electricity and is discharged as electricity. Depending on the storage technology, the energy is stored as another form of energy such as potential energy, chemical energy or in a magnetic field. The different types of energy storage technologies can be classified depending on their properties, applications or function [25]. The most common way to classify energy storage is depending on how the energy is stored. In this thesis three categories was chosen: Mechanical, Chemical and Electrical. The investigated category with respective technology are illustrated in Fig.(1).

Figure 1. The classiﬁcation of the ten investigated electrical energy storage technologies.

The forthcoming sections addresses function, advantages, disadvantages, main application and focus areas for the researchers, for all the technologies. The energy storage applications are further evaluated in section 6.

4.1 Mechanical In the mechanical energy storage systems are the energies stored as potential energy in pumped hydro storage and compressed air, also as kinetic energy in ﬂywheels.

4.1.1 Pumped hydro storage The basic idea for pumped hydro storage (PHS) is two reservoirs located at diﬀerent heights with a turbine in the canal between the reservoirs. The turbine is connected to the grid via a generator/motor.

8 The pumped hydro storage is similar to a hydro power plant with the extra feature of using the generator as motor and the turbine for pumping the water up to the higher reservoir. An illustration of a pumped hydro storage is found in Fig.(2). The energy capacity depends on the volume in the higher reservoir and the height diﬀerence between the reservoirs [26]. The energy is deﬁned as,

E = mgh, (1) where m is the water’s mass, g is the gravity and h is height between the reservoirs. The power output is deﬁned as derivative of energy, δE δm P = = gh. (2) δt δt

PHS is by far the most installed large energy storage with 127-129 GW in 2012. This storage technology is accounted for 99 % of the installed energy storage worldwide. In Bath County, Virginia is the world’s largest storage regarding power-rating with 3003 MW [5]. The main advantages are the high eﬃciency and large capacities [27]. While the technology is limited by the availability of two large sites for the reservoirs and also the high cost of constructing these sites with removing trees and building a dam. These preparation and the construction of the whole system takes typically ∼10 years [26].

Figure 2. An illustration of a pumped hydro storage system. During charge water is ﬂowing from the higher reservoir to the lower via a turbine. During discharge the turbine is used as a pump to transport water from the lower reservoir to the higher. From [5] with permission.

Since most of the components in this system, i.e. turbine, generator, are developed over several years, are the researchers focusing on new innovative reservoirs instead of the artificial dams. For example, the lower reservoir could be the seawater or a flooded mine. Then the higher reservoir are an artificial dam or above the ground [28].

9 There are also different types of systems depending on if there is external water flowing in or not. If the same water travels between the reservoirs and is separated from any external flows, it is a closed system. While if one of the reservoir are connected to a continuous flow it is a semi-open. If both of the reservoirs are connected to continuous flows it is an open system [25].

4.1.2 Compressed air storage This storage technique is based on the gas turbine principle [2]. The charge and discharge process are two diﬀerent systems. During charge, electricity is used to compress air into pressurized tanks/underground cavern [5]. During discharge, the compressed air is preheated and expanded through high and low-pressure turbines. The air is also heated by burning fossil fuel (natural gas) in order to generate electricity. Turbines are connected to a generator, which is connected to the grid [27]. A compressed air storage (CAES) is illustrated in Fig.(3), where blue pipes contain colder air than the orange pipes.

Grid Grid Air

Heat Motor exchanger Generator

Compressor HP & LP turbines

Air Natural gas (fuel)

Figure 3. An illustration of a compressed air storage system. During charge, air is being compressed and during discharge, the air is expanded through two turbine stages. This ﬁgure is adapted from [26].

This is the other storage which is also commercial available at typical ranges of 50-300 MW. The main advantages are the long storage period (∼year), good partial load performance and low capital costs (400-800 $/kW) [5, 26]. Due to the advantages the applications are peak shaving and load shifting. However, CAES suffers the same drawback as pumped hydro storage, finding suitable sites. One commercial production site is located in Germany. It is charged and discharged every day, eight hour of charging into salt caverns and two hours of discharging in a rate of 290 MW. The plant is used for starting up nuclear units, backing up the local power system and levelling out the variation between supply and demand [5]. The components that are included in this system are also well developed, as for PHS. Therefore researchers are investigating other geological structures than salt caverns. In Japan, a tunnel in an abandoned mine was covered with concrete for a 2 MW test program. Another tested a hard rock ground and in Italy a porous sandstone aquifers. An attempt to remove the natural gas dependent was made when advanced adiabatic CAES was invented. It uses thermal energy storage to heat the air in the expansion process. This variant of compressed air storage, is in the development stage and the first test facility is located Germany. If the charging step is powered by wind energy, there are no emission from the system [5].

10 4.1.3 Flywheel energy storage The main idea is to store energy in the angular momentum in a rotating mass [29]. The flywheel (mass) are connected via a shaft to a generator/motor and placed in high vacuum to reduce the energy losses due to air resistance [5]. In order for the shaft to be able to rotate there are bearings at each end of the shaft. When the flywheel energy storage (FES) is charged, the mass are accelerated and decelerated when discharged. The energy capacity is calculated with, 1 E = Iω2, (3) 2 where I is the moment of inertia and ω is the spinning velocity [30]. The moment of inertia is defined as, Z I = r2dm, (4) where r is the radius of the mass, and m is weight of the flywheel. The energy density regarding volume and mass, respectively, is, Kσ ev = Kσ em = (5) ρ where K is a shape factor, σ is the plane stress and ρ is the density of the spinning mass. The shape factor for a disc is 1, while for a flat pierced bar is 0.305 [29]. From Eq.(3) and Eq.(4), the energy capacity can be increased if the mass is spinning faster or has a larger weight or volume. In a rotating mass, there will be a tensile stress, that is a material property of the flywheel that will limit the spinning velocity [29]. Therefore, flywheels are divided into two categories, low speed flywheel and high-speed flywheel. The flywheel rotates below 6·103 rpm and ∼105 rpm with respect to their category [31]. These categories have different applications, the low speed is mainly used for short-term and medium/high power application, while the high speed is continuously expanding in high power quality applications [5]. The flywheel energy storage main advantages are the low maintenance and long lifetime (charge-discharge cycles ∼20000) [27]. The main disadvantage is the high hourly self-discharge up to ∼20% [5]. Bolund et al. stated that the energy storage capability is determined by the flywheel geometry and velocity. Also that the power is determined by the motor, generator and power electronics [29]. The beacon power company has a FES plant at a capacity of 20 MW and 5 MWh, that is used for voltage support and frequency regulation [5]. For the low speed system the flywheel are stainless steel or an alloy of aluminium, which cannot be applied for a high speed because of the stresses. Therefore the researcher focusing on developing composite materials for the high speed flywheel [31]. For comparison, a low speed flywheel material 4340 steal has the density 7700 kg/m3 and tensile strength 1520 MPa. A composite material Carbon T1000 has the density 1520 kg/m3 and tensile strength 1950 MPa. But of course are the composite materials 102 times more expensive $/kg than the steel [29]. Luo et al. stated that the energy density for a metal flywheel is ∼ 5 Wh/kg and for a composite flywheel is ∼ 100 Wh/kg [5].

11 Another important research area is the bearings. When the traditional mechanical bearings where used in high speed, there were high friction and short lifetime [31]. In 1980 when the magnetic bearings introduced with long lifetime, low losses and fast response time, the high-speed ﬂywheels were possible. There are three types of magnetic bearings: active, passive and superconducting. The superconducting magnetic bearing needs a cryogenic cooling system in order to achieve very low temperatures so the superconducting properties appear. The wanted property is levitation, which will result in friction free rotation, long life and self-stability. The disadvantage is the high cost of the cooling system even though there are innovative insulation scheme that decreases the costs [31].

4.2 Chemical The chemical energy storages that are reviewed in this thesis are electrochemical and hydrogen. The electrochemical energy storage systems that will be investigated are conventional rechargeable batteries and flow batteries. But for the hydrogen fuel cell in section 4.2.5 the hydrogen is produced via e.g. water splitting and stored in an external tank. Then the hydrogen is transferred to a fuel cell where the electricity is generated, while for these batteries the energy is stored within the same place where the electricity is generated. The batteries consist of several electrochemical cells connected in series and parallel to obtain the desired voltage. The path to understanding the batteries begins to understand how a single cell works. The electricity is converted to chemical energy through a reduction-oxidation reaction, or also known as redox reaction. In an oxidation reaction electrons are lost and in a reduction reaction electrons are gained. When both an oxidation and reduction occur, the electrons travel from one substance to another [28]. These cells consist of two electrodes that are connected via an external load. Between the electrodes are electrolytes that can be in a solid, liquid or ropy/viscous state [32]. The electrodes are refereed to as the positive and the negative electrode. The terms anode and cathode can lead to confusion since it is not referring to the same electrode during charge as discharge. The oxidation always occur at the anode and the reduction always occur at the cathode. The negatively charged ions that are drawn to the anode are referred to as anions. The positively charged ions that are drawn to the cathode are referred to as cations. During discharge, electrons flow from the negative electrode via an external load to the positive electrode1. At the same time within the cell are positively charge ions (cations) in the electrolyte travels to the positive electrode and the negatively charge ions (anions) in the electrolyte travels to the negative electrode. Opposite when the cell is charged, the electron travels to the negative electrode from the load and the positive electrode. Within the cell, the anions flow to the positive electrode and cations flow to the negative electrode in order to reduce the charge imbalance [28]. The discharge and charge of a electrochemical cell is illustrated in Fig.(4a) and Fig.(4b).

1The electrons ﬂow in the opposite direction of the current.

12 uigdshreteeetoe r oee yPbSO PbSO by covered of are electrodes the discharge During [2], is charging and discharging when electrode positive the at occur that reactions electrode The negative the at occur that reactions redox The is [2], is [28]. (PbO electrode charging negative oxide solution and The lead water discharging is a when cell. electrode in electrochemical positive acid rechargeable the sulphuric oldest and the (Pb) are lead batteries acid than lead applications batteries the The other acid But Lead in cell. batteries specific of 4.2.1 the experience on high depends which a disadvantage lifetime, and major limited efficiency a a [27]. is high stationary in This alternate the results [28]. mention. discharge are it degradation and principle to advantages since charge redox due batteries the the losses since the are with reality, there for work the and all of species subsections chemical simplifications between forthcoming are the equations in reaction Their types battery four The iue4. Figure 4 scoet noul n iia muti eeeae uigcharge. during regenerated is amount minimal a and insoluble to close is (a) h lutaino hrigaddshrigo neetohmclcl.Aatdfo [28]. from Adapted cell. electrochemical an of discharging and charging of illustration The Charging + Anode e− Positive electrode PbO Oxidation Electrolyte Reduction 2 SO + b+SO + Pb 4 2 Cathode − H 4 +

4 2 Negative electrode − - + ) −−−−− Discharge e 2 + −−−−− Charge 13 (b) − * 4 ) −−−−− PbSO Discharge ssae rmE.6 n q() h crystals The Eq.(7). and Eq.(6) from stated as −−−−− Charge Discharging + Cathode −

2 e .Telqi lcrlt oss f3 % 37 of consist electrolyte liquid The ). * 4 Positive electrode e 2 + PbSO Reduction Electrolyte − Oxidation . 4 H + 2 O Anode . Negative electrode - (6) (7) This results in low cycle life (∼1200-1500 cycles), low cell efficiency and it is the most ageing phenomenon to lead acid batteries [2, 33]. There are two types of lead acid batteries, flooded or valve regulated. The electrodes are placed in a reservoir of electrolyte in flooded batteries, while the valve regulated use minimal amount of electrolyte and they have more material of the negative electrode. This will increase the recombination of the gases that have been developed via water splitting2. Which occur when the battery is overcharged or float charged. The float charge is when a constant voltage is applied in order to reduce the self-discharge or the crystallization of electrolyte on the negative electrode. Therefore have the valve regulated batteries a potential lifetime of 10 to 20 years. If the flooded batteries are used as stationary it should only be float charged for a long period of time and occasionally be discharged. Then their lifetime could be around 15 to 30 years [28]. A lead acid battery was implemented in Chino, California with a power of 10 MW and energy of 40 MWh. This energy storage was a test facility for load levelling and spinning reserve. Currently the researchers trying to solve challenges regarding limited cycle life, low energy density and low charge/discharge efficiency [33]. One solution to the limited cycle life and efficiency problem is to incorporate a highly conductive material to the lead electrode. This material is usually of carbon nature that prevents the crystals while maintaining high conductivity [33].

4.2.2 Lithium ion battery The negative electrodes material consists of graphite and the positive electrode of a lithium oxide [34]. The electrolyte consists of a non-aqueous solution of salt and organic compounds. The salt is 3 often lithium hexaﬂuorophosphate (LiPF6) with a concentration of 1 mol/dm in a cyclic carbonates or linear carbonates such as ethylene carbonate (EC) and dimethyl carbonate (DMC) respectively [35]. The redox reactions that occur at the negative electrode when discharging and charging is [2], + − Discharge C + nLi + ne )−−−−−−−−−−*LinC, (8) Charge where n is the number of lithium ions. The reactions that occur at the positive electrode when discharging and charging is [2],

Discharge + − LiXXO2 )−−−−−−−−−−*Lin−1XXO2 + nLi ne , (9) Charge where XX can be Manganese (Mn) [Lithium-manganese oxide (LiMn2O4)] or Iron (Fe) [lithium iron phosphate oxide (LiFePO4)] [36]. One thing to notice is that the lithium ions are stored within the structure of the electrodes and not on the electrodes [26, 36]. The advantages of lithium ion battery are high cycle efficiency (∼97%), fast response time and high energy density (∼75-200 Wh/kg) [5]. The advantages origin from the low molecular weights hence the small ionic radius that is beneficial for diffusion [36]. The major disadvantage is the high cost (>600$/kWh) due to an integrated computer, which is needed for the operation [26].

2Water splitting is explained in section 4.2.5.

14 One problem that the computer needs to prevent is the growth of dendrites. Dendrites are small fibers of lithium, which protrudes from the positive electrode when the battery is cycled at a fast rate [37]. These fibers are spread in the electrolyte and in a matter of time there will exist a conduction path for the electrons through the electrolyte which will short circuit the cell. Hon et al. coated the electrode with a polymer and LISICON film to reduce the formation and diffusion of the lithium fibers. They also obtain a higher energy density 342 Wh/kg at an average discharge voltage of 3.32 V [38]. In Tehachapi, California a lithium ion battery with a power capacity of 8 MW and a discharge time at four hours (32 MWh) were installed in a substation. The project investigated battery’s performance to integrate large scale renewables and also improve the grid stability [39]. A topic for the researcher is developing a lithium air battery. The lithium air cell consists of a lithium anode and flooded composite cathode. The cathode is exposed to the ambient air and the oxygen reacts with the electrolyte and is reduced. The lithium air has a theoretical energy density, that is three to four time larger than current li-ions batteries [36]. Another topic is to develop new organic electrodes that are comparable to the best inorganic electrodes in energy density, life cycle and power rate. The main reason for this topic is to minimize the CO2 footprint for the battery. These organic electrodes are synthesized through a low-cost process free of toxic solvents called green chemistry. The electrodes are biodegradable and easily destroyed by combustion, so the recover process is also more environmentally neutral than for the inorganic electrodes [36].

4.2.3 Sodium-Sulfur batteries The sodium sulfur (Na/S) batteries have molten electrodes, that consist of sulfur and sodium for the positive and negative electrode respectively. They are separated by a solid electrolyte called β-alumina (NaAl11O17). The solid electrolyte experience the same ionic conductivity as H2SO4 at 300°C. The atoms in the solid electrolyte are arranged in a structure that contains much vacancy (holes). This results in conduction layers for the sodium ion to travel in. In order to obtain the optimal ionic conductivity from the electrolyte and at the same time ensure that the electrodes remain molten, the operational temperature for the Na/s batteries are 270-350°C [36]. The redox reactions that occur at the negative electrode when discharging and charging is [26],

Discharge 2 Na −−−−−)−−−−−*2 Na+ + 2 e−. (10) Charge

The reactions that occur at the positive electrode when discharging and charging is [26],

+ − Discharge 4 S + 2 Na + 2 e )−−−−−−−−−−*Na2S4. (11) Charge

A schematic of an Na/S battery is illustrated in Fig.(5).

15 Figure 5. A illustration of a Na/S battery. From [36]. Reprinted with permission from AAAS.

During discharge there will both be sulfur and sodium polysulfides (Na2S4) as stated in Eq.(11). Since, Na2S4 and S is immiscible at the operational temperature, a two-phase liquid will initially be formed. Theoretically, when the battery is completely discharged only Na2S4 exists. However, during charge, the two-phase liquid will reappear until the battery is fully charged. One practical problem during charge is, if the sulfur deposit on or near the electrolyte it will prevent the sodium polysulfides to oxidize. This results in higher cell resistance and lowers the amount of energy storage capacity [36]. The favorable properties of Na/S batteries are almost zero daily self-discharge, high pulse power (over times its continuous rating), uses inexpensive materials and non-toxic materials. However, the disadvantage is the operational temperatures require an extra system where the annual operational costs are high (80 $/kW· year) [5]. In the United Arab Emirates on the Abu Dhabi Island are a Na/S with a capacity of 40 MW. This battery is used for load levelling [5]. The researchers are focusing on decreasing the operational temperature to room temperature because of the higher energy density and resource abundance. At these temperatures the battery suffers from low reversibility due to low conductivity of sulfur [40]. These batteries use a sodium-metal anode, sulfur-carbon composite cathode and an organic liquid electrolyte. Another research topic is to enhance the conductivity of the β-alumina. According to Mercadelli et al. there are two β-alumina: β and β-Al2O3. The difference is the structure of how the atoms are arranged in the solid. There are three ways of increasing the ionic conductivity: (i) only β structure, (ii) no atoms in the conductive layers such as cadmium (Ca) and silica (Si) and (iii) fill all the slots in the micro-structure [41].

16 4.2.4 Redox Flow battery In this system there are external tanks with the electrolyte that are pumped into a reaction chamber where the redox reaction occurs. With this separation of the electrolyte comes that the energy and power capacity is independent of each other. These chambers consist of several cells. In these cells the electrolytes is separated with a membrane and electrodes on the outer side in the reaction chamber. The flow batteries can be divided into two groups: Redox flow and Hybrid flow. The difference between the groups is, if the reactants and products are stored in the external tank or partially within the cell [42]. For the redox flow batteries stores the products and reactants in the external tanks, while for hybrid flow it is partially stored internal. There are three major battery systems, all vanadium redox, polysulfides bromine and zinc bromine. The later is a hybrid redox, while the two first are redox flow batteries. The most mature redox flow battery is the Vanadium (V) redox flow. The redox reactions that occur at the negative electrode when discharging and charging is [5], Discharge V2+ )−−−−−−−−−−*V3+ + e−. (12) Charge The reactions that occur at the positive electrode when discharging and charging is [5],

Discharge V5+ + e− )−−−−−−−−−−*V4+. (13) Charge

As mentioned the flow batteries energy capacity and power capacity is independent of each other. The energy capacity is dependent on the concentration and amount of electrolyte, while the power is dependent on the area of the electrodes and number of stacked cells. Since the electrolyte is stored in external tanks the battery has very little self-discharge [5]. Also, it has a long life cycle, site independent and high efficiency [43]. However, the disadvantages are low energy density, high manufacturing costs due to the additional equipment needed. According to Zheng et al. flow batteries are consider to be part of the stationary energy storage [44]. The flow batteries have a number of appropriate applications such as enhancing power quality and improving load levelling. In Ireland a vanadium redox flow battery system with a power of 2 MW and energy of 12 MWh is used to reduce the power fluctuations from a wind farm [5]. The researchers are focusing on reducing the system cost by improving the power density and cyclability [43]. They focus on developing new materials for the membrane and electrodes with excellent properties. They also focus on understanding and addressing the complex transport phenomenon. Since, there are a bulk transport of the reactants and products through the cells. Also a micro transport from the pores of the electrode to the surface of the electrode. Simultaneously as the mass transfer, there is redox reaction occurring with a fluid flow. All of these phenomenon are strongly dependent on each other, so by improving one parameter does not necessarily improves the whole battery [43].

17 4.2.5 Hydrogen storage with fuel cell This system uses two separate processes for discharge and charge. During charge electricity is used to split water into hydrogen and oxygen (electrolysis), and the energy is stored as hydrogen gas,

2 H2O −−→ 2 H2 + O2. (14)

The hydrogen gas is transported via pipes to pressurized tank/underground cavern/metal hydrides. When the energy storage is discharging, the hydrogen is transported to a fuel cell or a gas turbine [27]. The fuel cell consists of two electrodes that are separated with a membrane, on each side of the electrodes are two reaction chambers where the oxidation and reduction occurs. The fuel cells are classiﬁed depending on the fuel and electrolyte: Proton exchange membrane fuel cell, Alkaline fuel cell, Phosphoric acid fuel cell, Solid oxide fuel cell, Molten carbonate fuel cell and direct methanol fuel cell [45]. The ﬁrst three fuel cells uses pure hydrogen as fuel, Proton exchange membrane and Alkaline fuel cell also uses the same charge carrier H+. The reaction at the negative electrode (anode) is, + − H2 −−→ 2 H + 2 e . (15) The reaction at the positive electrode (cathode) is,

1 + − O2 2 H + 2 e −−→ H2O. (16) 2 The major advantages are the scalability and the low effect on the environment due to no emissions. The drawbacks are the low efficiency (35-45 %), high capital cost and low energy density at ambient conditions. The application that suits these systems regards power quality and intermittent balancing. In Norway are a project with two wind turbines at 600 kW each and a hydrogen storage system. It stores the excess power in tanks (2,400 m3 at 200 bar) via an electrolyzer at 48 kW. Then the hydrogen is supplied to a hydrogen combustion engine at 55 kW [27]. This energy storage system can be divided into three processes: water splitting, storage, generation via fuel cell. The research is focused on improving water splitting and generation processes [46]. In the water splitting area, they are trying to integrate renewable power into the electrolyze. There are constructions that use solar irradiation for the electrolysis process. Similar to the traditional electrochemical cell (see Fig.(4)), but the electrolyte consist of water and some charge carrier. The solar radiation falls on the anode that collects electrons and producing hydrogen gas. Or it could be a catalyst in the electrolyte that splits the water. According to Liao et al. a joint interdisciplinary between several areas such as chemistry, physics, material scientists and applied electronics are required to achieve higher electricity to hydrogen efficiency [47]. However, researchers are trying to improve the overall operation for the fuel cell, which will reduce the cost. They will improve every component, while also investigate more about the mass transport phenomenon [46].

18 4.3 Electrical

4.3.1 Capacitors and supercapacitor The simplest capacitor consists of two electrodes (plates) with a non-conduction material in between known a dielectric. A power source is connected to the electrodes and similar to the electrochemical cell there are one positive and one negative electrode. Due to the voltage applied, the electrons migrate to the negative electrode. This causes an electric field and this potential is how the electricity is stored. Because when the voltage is removed, the electrons will travel to the positive electrode to reduce the charge difference [28]. The energy stored in capacitors is described by, CV 2 E = , (17) 2 where C is the capacitance and V is the applied voltage. The capacitance are defined as, A C = , (18) d where is the dielectric constant, A is the area of the plates and d is the distance between the plates [28]. Capacitors cannot store a large amount of energy,however, they can deliver a varying voltage. Therefore capacitor’s applications are power quality, high voltage power correction and smoothing the power output. However, they suffer from low energy density and high self-discharge losses [5]. Supercapacitor an improved capacitor with a higher energy density. This system has several name including supercapacitor: pseudcapacitor, electric double-layer capacitor, ultracapactior, and gold capacitor [28]. The structural difference between a capacitor and supercapacitor, is that the electrodes has an electrolyte between them for the supercapacitor and air for the capacitor. It is similar to a electrochemical cell, but there are not redox reactions occurring and the energy is still stored as an electric field. So in some sense this is a hybrid between an electrochemical cell and a capacitor. Since, there are non redox reactions the lifetime is not impacted by cycling the system as for the batteries. They could cycle more than 105 cycles with high efficiency (∼84-97 %). However, they suffer from high daily self-discharge (∼5-40 %) and high capital cost. The supercapacitors’ is used for short-term storage applications such as power quality consists of pulse power and hold up power to equipment [5]. One project in the Canary Islands that uses supercapacitor, with a power capacity of 4 MW and 5-second storage capacity. The energy storage are integrated in a conventional power plant and are used for frequency reserve that overall increases the reliability for the islands electrical grid [27]. Currently the research is focused on improves the material of electrodes. The area of the electrode affects the energy stored (From Eq.(18)) and with carbon nano tubes the area increases dramatically [48]. The larger area of the electrodes, the more energy can be stored within the supercapacitor.

19 4.3.2 Superconducting magnetic energy storage As commonly known, when the temperature is decreasing the resistivity of a solid also decreases due to less motion of the atoms in the solid. In 1911 H. Kamerlingh Onnes was surprised when he discovered that the resistivity dropped dramatically to zero at 4.2 K. Since, the resistivity decreased linear, he thought that the resistivity would be zero at 0 K. This phenomenon is called superconductivity [49]. The superconducting magnetic energy storage (SMES) uses this superconducting phenomenon and consists of mainly three components: cryogenic cooling system with a vacuum subsystem3, a superconducting coil unit and a power condition system [5]. The energy is stored in the magnetic field generated by the direct current flowing through the coil. The magnitude of the energy is determined by, LI2 E = , (19) 2 where L is the induction of the coil and I is the direct current. Since the coil has zero resistance the electricity is stored almost without loss. There are no chemical reactions occurring, so it has high cycle efficiency (∼95-98%), long lifetime (up to ∼30 years) and a fast response time (∼ milliseconds) [5]. The efficiency loss is due to the conversion losses. since, the electricity is stored as a direct current, so it needs to be converted to alternating current during discharge/charge [28]. The system needs to be cooled to low temperatures, this result in the major drawback that is the high capital cost (up to 10 k$/kWh and 7.2 k$/kW) [5]. The coil has a precooling time of about four months, from room temperature to operational temperature [50]. Superconducting magnetic storage are used for short- term storage applications such as power quality and intermittent balancing [27]. The discovery of materials that posses the superconducting behavior at higher temperatures, divided the coils into two categories: High temperature superconducting (HTS) coils and Low temperature superconducting (LTS) coils [5]. The high temperatures coils operate ∼70 K and the low temperature coils ∼5 K. The LTS system are commercially available, while the HTS coil systems is the development stage. The recent research and development is intended to reduce the capital cost. The capital cost consists of materials for the cooling and vacuum system, coils and the converters. According to Ali et al. the potential applications and benefits for the environment will hopefully decrease the capital cost, so it will be an available energy storage in a near future [51].

3It is signiﬁcantly easier to decrease the temperature in a vacuum.

20 5 Operational power and degree of maturity of present energy storage technologies The aforementioned technologies are in different stages of maturity and utilization in different large- scale application. The distribution of the global operational energy storage systems with respect to the rated power is displayed as two pie charts in Fig.(6). Operational includes all projects that were up and running 2017-03-27, when the data was extracted from DOE database [52]. The left chart are all technologies, that states that Pumped hydro storage accounts for 99 % of the rated power, while the right chart displays the distribution of the remaining 1%. There lithium batteries are the largest with its 39.2 %. In second and third place comes Flywheels and compressed air, 27.9 % and 19.1 % respectively. The category Other covers unspecified electrochemical technologies, nickel based batteries, sodium based batteries except Na/S and lead carbon batteries [52].

Flow batteries [1.4%] Flywheel [27.9%] CAES [19.1%] 1.4%

19.1% 27.9%

PHS 99% 5.7% 2.3% Na/S [5.7%] 4% Supercapacitors [2.3%] 0.4% Other [4%] 39.2% Hydrogen storage [0.4%]

Lithium batteries [39.2%]

Figure 6. An illustration of the distribution of the global operational energy storage systems in 2017-03-27 with respect to the rated power. The left pie chart displays that 99 % of the operational power comes from Pumped hydro storage. The right pie chart is the distribution of the 1 % of the other technologies [52].

The distribution of operational storages depends of several parameters such as investment cost and degree of maturity. The diﬀerent stages of maturity ranges from research, development, demonstration, deployment and mature. In Fig.(7) the mentioned technologies ,except lead acid batteries at their degree of maturity are being visualized. The vertical axis is the product of capital requirement and technology risk. The product increases from research to demonstration. At the beginning of deployment is the highest product and after that reduces the product. This maximum is confusingly known is the valley of death [53]. Note that this ﬁgure does not have any numerical values and hence should be taken as illustrative.

21 Flow batteries Li-ion Supercapacitors Flywheel low speed SMES Na/S AA-CAES Hydrogen CAES

Chemical PHS Mechanical Electric Product of Capital requirement and Technology risk

R&D Demonstration Deployment Mature technology Time Figure 7. The technologies categories from their degree of maturity and the product of capital requirement and technology risk. The abbreviation R&D is Research & development. Notice the absence of numerical values; this should only be considered for a illustrative way of showing the degree of maturity. The data points are from [27].

The data in Fig.(7) is from 2012 and therefore are only PHS a mature technology. When comparing the distribution of technologies in Fig.(6) with the degree of maturity. PHS is the most used energy storage; this is because of its simplicity and similarity to a well-developed hydro power plant. By comparing the remaining distribution of 1 %, li-ion, ﬂywheel, Na/S and CAES is in the stage of deployment and are the four most operational storage systems except for PHS. Note also that hydrogen accounts for 0.4% of the operational energy storage and was in the research and development stage 2012. According to Rastler several of the technologies that was in the deployment and demonstration stage will be mature in 2020: Flywheel, li-ion, CAES and Flow batteries. Another prediction was that supercapacitors will be over the valley of death and SMES will be close to the maximum [54]. This prediction means that several technologies will be mature and well tested in 2020, so the storages will be justiﬁable alternative to their meant applications. In Sweden there is only one grid connected energy storage. The storage was commissioned in 2011 and is still operational. This is an collaboration between Falbygden Energi and ABB AB, it uses lithium ions batteries that can generate 75 kW in one hour. The batteries were installed in a already existing substation in order to balance the peak load and increase the grid stability. These stores power from an near by wind farm when the demand is low [55].

22 6 Energy storages applications For grid connected energy storage features such as, operational safety, low installation cost, long operation life and high conversion eﬃciency, are most important [36, 33]. Other parameters such as energy density and power density, which is important for portable devices, are less important features for large-scale energy storage. The applications are divided into two branches, load levelling and ancillary services. The load levelling branch is categorized into power ﬂeet optimization, transmission and distribution deferral and isolated area supply. The ancillary services branch consists of provide operating reserve, ensure power quality and black start services [27]. These branches with subcategories are illustrated in Fig.(8).

Electrical Storage

Ancillary services Load levelling

Provide Power Black Ensure Isolated opera ﬂeet T&D start Power area ting optimiz deferral services quality supply services ation Figure 8. Large scale energy storage application in a tree structure. The categories are from SBC and are general groups of applications [27].

The black start service includes starting up a nuclear unit from a stop without power from the grid. It could also be when the grid shuts down and the communication equipment to the DSO are powered by an storage to locate and solve the problem [5]. Energy storage can ensure power quality by reducing the voltage spikes, voltage sags and short power outages lasting a few cycles [56]. By complementing the energy storage with a dynamic inverter, communication and control equipment it can be used to reduce the reactive power, which is also beneﬁcial for the power quality [57].

23 The energy storage can deliver operating services such as standing and spinning reserves for supporting the frequency. As mentioned in section 2.1, there are two categories of reserves: automatic and manual [5]. Another operating service application that energy storage can supply is to fill the gap between an interruption and for the back up generators to start. Lahyani et al. tested combining supercapacitors and lead acid batteries. The supercapacitors provided a high short burst then the batteries delivered the bulk energy [58]. The power fleet optimization is the application used for maximizing the use of the bulk generation. Instead of starting another production unit such as gas turbine during peak demand, the storage delivers the remaining energy. This is called Peak Shaving. Peak shaving is similar to ramping and load following. Load following is done by adjust the power output to the grid depending on the demand (ramping), so the bulk production unit generate electricity at the best possible efficiency. Time shifting is another application that is associated with power fleet optimization. The storage is charged when the demand is low, hence the electrical price is low and discharge when the price is high. In this category comes also integrating renewable power, with stabilizing and smoothing the power output [5]. In California a redox flow battery at 25 MW was installed with a wind park instead of a peak generation fossil fuel plant at 50 MW [4]. T&D Deferral is when the peak loads in the cables are reduced and hence postpone an investment in new equipment. When the peak load is reduced, the distribution losses also decreases due to the lower peak currents [57]. All of these aforementioned applications for energy storage already have solutions. For example has black start services diesel generators, so this means that energy storage will be an alternative to the other solution [59]. In the environment approach it is better to use electricity from a non- polluting source than fossil fuel, but if the storage is less reliable and more expensive it will not be a sustainable alternative. EPRI distinguish 21 applications for energy storage in all the positions in the grid:ISO markets, system, transmission, distribution and end-consumer [57]. With ISO markets means a market where electricity services are traded such as Nord pool. They state that storage solutions that serve several purposes, such as ancillary services and T&D deferral together will be strengthen towards other alternative for those service [57]. These applications have a discharge time on different timescales, from second, minute to seasonal storage, and require power in different magnitude as illustrated in Fig.(9). The red dotted rectangle is the area of interest for the forthcoming case study in section 9.

24 Month Intermittent balancing

Day Power ﬂeet optimization T&D investment deferral

Hour Black start services PQ Discharge time Minute Operating reserve

Second

0.1 1 10 100 1000 Power requirment [MW]

Figure 9. The energy storage application from Fig.(8) are categories with respect to power requirement and discharge time. This plot shows the order of magnitude for the applications and should not be taken for exact values. The abbreviation PQ stands for Power quality. The data are collected from [27].

The various mentioned applications require different properties. For example operating reserves have a power requirement from 0 to about 300 MW and a discharge time from a seconds to minutes. One remarkable application is intermittent balancing ranging from seconds to months and also from 0.1 to 1000 MW. Transmission and distribution investment deferral’s area lies within intermittent balancing. Applications that lie within the same area, only indicates that those application require the same discharge time and power. If two application areas are not near each other indicates that they need different properties. The technologies are different regarding power capacity and discharge time as illustrated in Fig.(10). The red box in the figure is the area of the forthcoming case study in section 9. PHS have large power capacity and long discharge time while supercapacitors have low power capacity and short discharge time. If technology areas are partly coincide, those technologies can be used for the same purpose such as PHS and CAES. If technology areas are far from each other, hence they possess different properties as SMES and Hydrogen fuel cell. Note the wide range in both discharge time and power capacity for batteries, they overlap all the other technologies. The batteries consists of various technologies as mentioned in section 4.2.

25 Hydrogen fuel cell Month

PHS Day

Batteries CAES Hour HSF Discharge time Minute LSF SMES Second Supercapacitor

0.1 1 10 100 1000 Power capacity [MW]

Figure 10. The energy storage technologies are categorized with respect to power capacity and discharge time. Batteries includes conventional and redox ﬂow batteries. The data are collected from [27].

Comparing Fig.(9) and Fig.(10) several interesting findings are revealed. The batteries range from about minutes to days in discharge time and about 0.1 to 100 MW in power capacity. All applications have, if not all but a part of its area, within that same range. This indicates that batteries have a great incentive for future development. For the application operating reserve are flywheels, supercapacitors, batteries and SMES potential technologies. While PHS, CAES and Hydrogen fuel cell has an unsuitable discharge time and power capacity. According to Sauer, which categorized energy storage depending on several parameters such as application, and location, flywheels and PHS cannot be compared since they will not serve the same purpose [60]. He also concluded that both of the technologies are needed for the respective applications [60].

26 7 Energy storage cost breakdown The total cost for an energy storage consists of a combine cost from several factors. These factors can vary between different storage systems. Bradbury divided these costs into five categories: energy storage system, power conversion system, balance of plant, operation & maintenance fixed and variable [28]. The energy storage system cost is the cost for the energy storage itself e.g. the anode, the cathode, the electrolyte and the cell cover with all its connection cables. This cost is divided into two separate branches, one for power capacity cost (CPC, $/kW) and one for energy capacity cost (CEC, $/kWh). This further division is done with the assumption that energy capacity and power capacity are independent of each other. This assumption is not true but as an approximation of the total system cost, it is good enough [28]. Since, storage systems like pumped hydro and redox flow batteries separates the power and energy capacity. Other systems like lithium ion batteries and flywheels can be connected in series and parallel to change the power capacity and energy capacity. The cost of the components between the energy storage and the grid are included in the power conversion system (CPCS, $/kW) category. The components are control systems, power lines, transformer, system isolation equipment, safety sensors and power conditioning equipment. In the balance of plant (CBOP, $/kW) category are costs for the land (storage site), access routs, taxes, permits, fees and construction costs. The operation & maintenance (COM) are also divided into variable cost ($/kWh) and fixed annual cost ($/kW). The variable cost is dependent on the delivered energy and the maintenance that origin from using the storage. According to Bradbury the variable cost is significant lower than the other cost, and therefore left out. The fixed cost is the annual maintenance that the system requires to be operational. To calculate the total investment cost of an energy storage, Cinv = Pinstalled(CPC + CPCS + CBOP) + EinstalledCEC (20) where Pinstalled is the installed power capacity and Einstalled is the installed energy capacity. The total lifetime cost of operation & maintenance can be calculated with, " # 1 − (1 − r)N Ctom = COMPinstalled , (21) 1 − (1 − r) where r is the discount rate and N is the years of operation. To obtain the total cost for the energy storage lifetime both Eq.(20) and Eq.(21) are summed,

Ctot = Cinv + Ctom. (22)

27 8 Summary and future trends for the energy storage technologies Pumped hydro storage is the most installed storage in the world regarding power rating. This is most likely to the simplicity of the storage and the similarity to the well-developed hydro power. The technology is suited for high power and long discharge time applications such as intermittent balancing and power fleet optimization. Compressed air energy storage similar to the PHS is based on a well-developed principal. Also the applications is similar to the PHS, but with shorter discharge time and lesser power capacity. Both the CAES and PHS have the same problems with finding suitable constructions sites, therefore the researchers are investigating other alternatives to artificial dams and salt cavern. The flywheels have faster discharge time and lower capacity, so they are more suitable for power quality, operating reserves and of course intermittent balancing. The supercapacitors have also a discharge time at under seconds to minutes. 2012 this technology was in the demonstration stage and in 2017 it accounted for 2.3 % of the remaining 1 % (see Fig.(6)). The other electrical energy storage, SMES, is suiting the same applications as supercapacitors except that it contains a higher power capacity. This technology was also in the demonstration stage 2012 but more in the beginning and there are not any project: operating, offline or under constructing. Probably the researchers have not succeed with the decreasing of the investment cost for the cooling system. The SMES is a theoretical good technology, with approximately 100 % efficiency, non-toxic operation, unlimited cycles. But it does not have any test facilities in 2017 and it has been an option for several years. Similar to a fusion reactor, which have been an alternative from 1940 when they began to research on the reactor. The batteries area in Fig.(10) covers most of the applications in Fig.(9). This means that batteries can be used for all the mentioned application. From the evaluated chemical storages only lithium ion, sodium sulfur and redox flow batteries are above 1 % of the remaining 1 % in Fig.(6). Lead acid is a mature and is well used for regular cars, but it has a very low cycling life. Therefore it is probably not part of the future stationary energy storages. As for batteries in general, the applications that are not grid connected, but rather portable, is constantly increasing. There are batteries in laptops, mobiles, tablets and electric vehicles. This extended use of mostly lithium ion battery will increase the mass production of the electrochemical cell. Companies such as LG Chem, Samsung and Tesla all want to mass-produce lithium ion batteries since the car industry is in transition to more electrical vehicles. These industries will not only improve the batteries, they will also reduce the investment price for a lithium electrochemical cell. This will affect the large-scale lithium batteries, with lower prices and more test facilities that will also improve the system around the cells such as power conversion electronics and safety equipment (dendrites). When comparing the conditions for hydrogen verses batteries or the other storages. Hydrogen would most likely require an infrastructure for the hydrogen gas. Since, the efficiency for converting electricity to hydrogen and then back to electricity is low. So the energy should be able to both be utilized as electricity and hydrogen. This will probably not be a universal solution that can be implemented anywhere.

28 However, there is a project on Gotland that theoretically investigates the profitability of such a process. Gotland has an existing gas network and waiting on an new cable to the main land. This project would use the surplus energy from the wind turbines to produce hydrogen that will be processed to methane. The methane will be used for the commuting traffic at the island. This project assumes that all the bi-products from the process are bought, investment support and a tax reduction on the gas production [61]. Note that this system will not generate the amount of required income to pay for itself. For the future there will probably be both PHS and CAES for the seasonal and bulk storages. With the reasoning above the lithium ion will be a large contributor to the energy storages for most of the applications. The Na/S battery will probably also be part of the future since its substances are abundant, cheap and has a high cycling life. It is predicted by Theien et al. that in the future the Na/S will have a lower LCA score than lithium ion batteries [62]. The batteries, flywheels and supercapacitors have an advantage over PHS and CAES, since they are not dependent on a suitable location. They will not need a comprehensive environmental impact assessment that will lengthen the time until commissioning. If the energy storage industry will explode and the market demands the benefits from the storage investment fast, they will probably use less site dependent options.

29 9 Case study The aim of this case is to investigate the profit from installing an energy storage in an existing wind farm. This wind farm has an installed capacity of 20 MW. The application for this energy storage is load levelling and more precise power fleet optimization. The measurements that are available have an hourly resolution and the wind production fluctuate every minute. According to Kawakami et al. 60 % of installed power capacity of the wind farm is required to obtain constant power output [63]. With this power capacity the fluctuation within a hour can be disregarded, therefore the required power capacity is 12 MW and have a duration of 1 and a half hours (18 MWh). The area of interest are refer dotted rectangle in Fig.(9) and Fig.(10). From the discharge time verses power capacity Fig.(10), there are two suitable technologies, batteries and hydrogen. The arguments in the aforementioned section excludes hydrogen storage. The technologies remaining are Na/S and lithium ion batteries. Lithium ion is the second largest and Na/S is fifth largest energy storage regarding rate power in 2017-03-27 (see Fig.(6)). Therefore are lithium ion batteries chosen in this study. This wind park is assumed to be moved within Sweden and therefore benefit from the alternating electricity price. As mentioned above, Sweden has four electrical areas with individually hourly electricity prices. In the Tab.(1) presents the minimum, maximum, average and median electrical price for the four electrical areas. The minimum and maximum hourly electricity price is the same in all the electrical areas. For SE1 and SE2 also the average and median price is the same. The average and median price is highest in SE4, thereafter SE3 and lowest prices have SE1 and SE2. Therefore it is most profitable to choose SE4 for location of the wind park.

Table 1. The hourly electrical prices for the four diﬀerent electrical areas. The minimum, maximum, average and median prices for 2016 [64].

Electricity price [SEK/MWh] Electricity Area Minimum Average Median Maximum SE1 Luleå 38.7 275.3 255.5 2003.2 SE2 Sundsvall 38.7 275.3 255.5 2003.2 SE3 Stockholm 38.7 278.0 258.1 2003.2 SE4 Malmö 38.7 280.8 260.8 2003.2

The lithium ion batteries (section 4.2.2) eﬃciency (from grid via the storage to grid), self discharge, cycle life time, expected lifetime and maximum charge are stated in Tab.(2).

30 Table 2. The lithium-ions used in this power ﬂeet optimizations speciﬁcs. All the values are from Bradbury [28].

Parameter Value Roundtrip eﬃciency [%] 90 Self-discharge [%Energy/day] 0.2 Cycle lifetime [Cycles] 10000 Expected lifetime [Year] 15-5

The total costs for lithium ion batteries are stated in various articles and are summarized in Tab.(B1) in Appendix B. From these prices three price cases are developed: Maximum, Minimum and Future. These price-cases is stated in Tab.(3).

Table 3. The total cost per energy and power. The prices are the maximum, minimum and future.

Maximum Minimum Future Total [SEK/kW] 36000 [26] 20000 [65] 11000 [26] Total [SEK/kWh] 22000 [26] 4300 [65] 2500 [65, 66]

9.1 Method The utilization of the energy storage was optimized in order to maximize the income for 2016. This was done with a plug-in to Excel called What’s Best. In What’s best, a global nonlinear solver was used. The code was developed to choose between storing the produced energy, sell all produced energy or discharge energy from the storage. The battery is assumed to be able to fully charge or discharge between two hours. Also the maximum charged level is 90 % of its energy capacity. This will lengthened the batteries lifetime, since when it is completely full (or empty) it damages the battery. The income for this wind park origins from selling electricity and electric certiﬁcates. The hourly electricity price in SE4 is collected from Nord pool [64]. The certiﬁcates price is set to 132 SEK/MWh, which is an average for 2016 [67, 68, 69, 70]. Another expense, that is lowered with an energy storage is the fee to SvK by planning the production more accurate. The fee for generation more or less electricity than planned depends on the frequency of the electrical system. In Fig.(11) are the matrix that specify the cost of the deviating production. If the electrical system is "Up" or "Down" Svk wants to generate more or less electricity. If the production unit generates too little or too much regarding their planned production, they sell the electricity for an Up or Down price. If the system is unregulated then the spot, up and down electricity price is the same.

31 If the system is "up" the Up-price is larger than spot-price, while Down-price is spot. If the system is "down" the Down-price is less than spot-price, while Up-price is spot-price. Therefore are the relation between Up, Down and spot price depending on the grids need to regulate or not. In Fig.(11) is it assumed that the production unit sell their planned production on the spot-market. The deviation only results in a shortened proﬁt when the system and deviation counter each other. This is when the production unit produce to much, when the system wants to generate less (go down) and vice versa.

System System System Up Down Unregulated

Production EplanCspot + ∆ECDown EplanCspot + ∆ECDown EplanCspot + ∆ECDown

Too much = EprodCspot < EprodCspot = EprodCspot

Production EplanCspot − ∆ECUp EplanCspot − ∆ECUp EplanCspot − ∆ECUp

Too little < EprodCspot = EprodCspot = EprodCspot

Production EplanCspot EplanCspot EplanCspot

Exact = EprodCspot = EprodCspot = EprodCspot

Figure 11. The actual production could be more/less or exact to the planned production. The electrical system could need more/less or no action to maintain the frequency in the right area. The fee to Svk is determined by the deviation production and what the electrical system needs. Eplan is the planned energy, Cspot is the spot price, CDown is the down-price, CUp is the up-price and Eprod is the actual production.

This expense was calculated with the concept presented in Fig.(11) to 0.63 MSEK in 2016. Since the power output from the wind farm is suppose to be constant, this expense is assumed to not exist anymore. The estimate battery life is calculated with the concept in Appendix C and the payback time is set to five years. So an assumption that the five forthcoming year (and the approximated lifetime) all the prices and cost will remain the same. Therefore are all the costs and delivered energy multiplied with five (and the approximated lifetime) in order to create an insight of the magnitude of the concerning costs. The total investment cost for this lithium ion system is calculated with,

CTOT = PinstalledCtot,p + EinstalledCtot,e, (23) where Ctot,p is the total cost for all power related equipment and Ctot,e is the total cost for all energy related equipment. The objective function that will maximized the profit for this park for a five-year period is, 8760 h X i fMax = EOut,i(CSpot,i + Cel.cert) + CSvK Y − CTOT, (24) i=1 where EOut,i is the hourly energy output to the grid, CSpot,i is the hourly electricity price on the spot market, Y is the amount of years, Cel.cert is the price for electricity certificates and CSvK is the income for not paying the fee to SvK. This system schematics is illustrated in Fig.(12).

32 Energy Discharge storage >

Charge > Grid >

Wind Farm

Figure 12. The schematics of the simple arbitrary system.

9.2 Results The three battery prices for a lithium ion system at 12 MW and 18 MWh, with the annual income for five years are presented in Tab.(4). All the battery prices resulted in non-profit scenarios. The largest price gives a loss of 731 MSEK, the smallest gives a loss of 220 MSEK and the future price gives a 76.6 MSEK for a five-year period. The battery was annually cycled 996 times and it was calculated with the concept presented in Appendix C. By dividing the annually cycles with total of cycles in Tab.(2), gives a total lifetime of approximate 10 years.

Table 4. The total cost with contribution from both power and energy, the annual income from selling electricity, certiﬁcates, avoiding the fee to SvK and the negative result for all three cases.

Battery cases Contributions Maximum Minimum Future Cost per power [MSEK/MW] 35.6 20.0 10.7 Cost per energy [MSEK/MWh] 22.3 4.3 2.5 Total cost [MSEK] 829 318 174 Price per el certiﬁcate [SEK/MWh] 132 132 132 Energy out [MWh/year] 0.43 · 105 0.43 · 105 0.43 · 105 El certiﬁcate [MSEK/year] 5.62 5.62 5.62 Prognosis [MSEK/year] 0.63 0.63 0.63 Sold electricity [MSEK/year] 13.2 13.2 13.2 Results [MSEK] -731 -220 -76.6

33 In Fig.(13) the battery prices are described with Eq.(23) for different power capacities of the energy storage with a discharge time of 1.5 hour. The capacity is converted to percentage of the wind farms power capacity. There are also a constant income that is based on having a battery at 60 % and be able to annually sell the same amount of electricity and certificates. Also not paying the fee to SvK. These annual incomes are state in Tab.(4). There are two income scenarios, five and ten years (the calculated cycle lifetime). In Fig.(13) the intersection between five years income and the prices are: maximum case ∼7 % (1.4 MW and 2.1 MWh), minimum case ∼18 % (3.6 MW and 5.4 MWh) and for the future case ∼34 % (6.8 MW and 10.2 MWh). For ten years income, which represent the whole lifetime, is the affordable capacities ∼15 % ∼37 % and ∼ 68 %. Note that the intersection for the future price and 10 years is 68 %.

400 Future 350 Maximum Minimum 300 Income 5 years Income 10 years 250

200

150 Money [MSEK]

100

0 10 20 30 40 50 60 70 80 Procentage of wind farms power capacity [%]

Figure 13. The cost for the lithium ion battery is described as a function of power capacity of the wind farm. The energy storage has discharge time of 1.5 hours at maximum power. The income is based on having a battery storage of 12 MW and 18 MWh and annually selling the same amount of electricity and certiﬁcates and also skip the fee to SvK as in 2016.

The electricity price for SE4 at 2016-08-17 is presented in Fig.(14a). The production from the wind farm, the level in the energy storage and the output to the grid is presented in Fig.(14b) for the same day. The electricity price at 3 o’clock is 207 SEK/MWh that is the lowest of the day. While at 11 the electricity price is 385 SEK/MWh. The diﬀerence is 178 SEK/MWh. It is approximately constant around 350 SEK/MWh between 7 and 21 o’clock. Then under the night the electricity price decreases.

34 The wind production is measurements and note the wind does not coincide with the electricity price. It generates most power during the night and lesser during the day and evening. The energy storage are charged and discharge two times this day. The energy storage is fully charged at 10 o’clock in order to sell at the highest spot price at 11 o’clock.

400 SE4 350

300

250

200 0 2 4 6 8 10 12 14 16 18 20 22 24 Electricity price [SEK/MWh] Time [hour] (a) 25 Output Production Level in Energy storage 20

10 Energy [MWh]

0 0 2 4 6 8 10 12 14 16 18 20 22 24 Time [hour] (b)

Figure 14. The hourly spot price for one day in SE4 is presented in Fig.(14a). The power production from the wind farm, the power output to the grid and the energy level in the lithium ion battery is presented for the same day in Fig.(14b). The selected day is 2016-08-17 due to the high utilization of the battery.

35 9.3 Discussion 9.3.1 Method Investigating the profitability by taking the annual income times years and minus the expenses (refer Eq.(24)) evaluates the most fundamental question, are the income higher than the expenses? There is an inherent assumption that all of the income should cover the energy storage investment. Also, that the wind farm is completely bought of, without any loan and that the wind farm is without any operational and maintenance costs. Taking the annual income times five is a vague assumption, hence it states that the all five years is equal. This assumption sets constant, electrical price, wind production, el certificate price and a prognosis fee for the whole period. This is probably the simplest investment calculations, but it results in losses of 80 MSEK for a five-year period. However, for the ten-year period, which is the calculated lifetime of the battery, the income indicates a profit of 20 MSEK. This result is discussed in the forthcoming subsection. The idea for the energy storage prices is that the imaginary manufactures offers the prices stated in Tab.(B1). The battery prices are converted from dollars and euros to Swedish krona (SEK) in 2016 with interchange currency of 1 SEK = 8.91 $ [71] and 1 SEK = 9.51 € [72]. For example, Chen et al. prices are not converted with inflation from 2009 to 2016 values and then converted to SEK. The maximum prices for energy and power are from Chen et al, they did not state what was included in the price. But expenses for operation & maintenance, replacement and ownership are excluded [26]. The minimum prices are from Zakeri and it includes the whole system from engineering cost to making access routs to the site [65]. The future case is a combination of sources. For the energy capacity Chen et al. price is used [26] and for the power capacity a combination of both Kurzweil and Zakeri is used [65, 66]. Kurzweil predicted that the battery price will decrease due to higher production capacities. In 2020 the estimated price is around 200 EUR/kWh [66]. The batteries contribution to the minimum total price from Kurzweil is subtracted and the future price for batteries are added from Zakeri [65, 66]. Since, Chen did not state what was in his price and by combining costs from three sources it is most likely that some costs are not included. However, all of these cases resulted in major losses. The farm is designed to only store electricity from it’s own production. This would be a legal solution since the storage is behind the farm’s meter. One expense that is not considered in this case is the network tariff. According to a project sponsored by Swedish Energy Agency a wind farm at this size should be connected to the regional network [73]. Vattenfall has two suitable network tariffs for generating electricity to the grid stated Tab.(A1) in Appendix A. There are two annual fixed costs and one distance dependent of the nearest connection to the national grid. The only cost that can be reduced from utilization of an energy storage is reducing the maximum power outputs. With a PT2 tariff, reducing the maximum output from 20 MW to 18 MW annually saves 0.3 MSEK (15000(20-18)'0.3MSEK). But the two other fees generate 0.4 MSEK in just fixed fees, without the distance dependent fee. So if the electricity also can be extracted from the grid, the park will be a prosumer (producer and consumer). How the tariffs would be designed for such a solution is unclear. If the farm were in Vattenfall’s area, it would probably be two tariffs, one for the withdrawal power and one for the input power.

36 It is stated, if a consumer also produces some electricity, the transfer fee for input is the same as the transfer fee for withdrawal. With a requirement, only if the input power is small in relation to the withdrawal power. This would not be the case for this farm. However, it would probably be a lager cost than income if the battery could be charged with electricity from the grid.

9.3.2 Results The amount of charge and discharge cycles for the battery was calculated to 1000 cycles per year. This calculation does not required the battery to complete a full cycle, it only recognize when the battery goes from charging to discharging. This means if the battery is charged to 60 % and discharged to 10 % and starting to charge again, it is counted as 1 cycle. So the battery lifetime could be more than 10 years. This is a plausible result since it is stated to be operational for 15 years. The lifetime is also probably a little longer since it is fully charged at 90 % of the energy capacity. This is an active choice that will lengthen the batteries life. From Fig.(13), it shows two major thing: (i) How far the costs are from the income and (ii) what is the affordable energy storage size for the different cases for five and ten years. The affordable capacities for 5 years are ∼7 %, ∼18 % and ∼34 %, if the prices are linear between 0 and 60 %. I would imagine that the investment cost in reality would have a more logarithmic appearance. In the beginning the investment should be higher because all the stationary cost such as a house, access roads, engineering costs and cables. So it should not start at zero. Then when more power and energy capacities are installed, the cost should increase in a continuous way until a new cable is required. Then it should increase in a discreet way because of the cables and miscellaneous power and energy dependent equipment. However, in this case the price is assumed to be linear. So for five years income is 34 % the highest affordable capacity. The energy storage power capacity was set to 60 % of the wind farm according to Kawakami et al. in order to deliver a constant output [63]. Kawakami et al. also state that reducing the fluctuation characteristic of the wind power production only requires 20 % instead of 60 %. This is done by reducing the maximum and minimum values on a minute basis [63]. Since, the measurements used in this case study are on hourly basis, the stabilization would be between the accessible data. However, 20 % is an affordable size for the futuristic battery price if the income would be as for a 12 MW and 18 MWh energy storage. So this is probably not an profitable solution since the income from selling electricity and certificates are probably not enough. Disregard the fee to SvK, the farm would also need another income for delivering a more stable output. For ten years income, which represent the whole lifetime, is the affordable capacities for the future price is 68 %. This indicates that the energy storage is affordable for a ten-year period. The economical aspect for 10 years is an even more vague assumption than for five years. Because this means that the wind farm is totally bought of and there are non operational and maintenance cost for a 10 year period for both the wind farm and energy storage. This is highly unlikely. For the income to be constant for 10 years is also unlikely. The incomes are more discussed in the next piece below. Even if this case indicates that it is profitable, it is probably not. I think there are not many companies will invest approximately 200 MSEK (see Tab.(4)) without loans. Therefore will the cost will increase further due to interest rates and hence the solution will probably not be profitable.

37 The income is dependent on the spot price, el certificate price and the fee to SvK. The spot price is dependent on the markets supply & demand approach and investigating how the electricity price will change in the forthcoming years is beyond of this thesis purpose. Also the future trends for the el certificates will be left uncomment in this thesis. The prognosis fee is calculated with concept presented in Fig.(11). A similar calculation from Etherden et al. concluded that for a non dispatchable energy resource could save ∼2 MSEK with a energy storage [74]. They had a virtual power plant of 34 MW wind power and three battery capacities with 2h or 4h discharge capacity MW/MWh (2/4&8, 4/8&16, 8/16&32). In this case the fee was 0.6 MSEK, but it was a smaller wind farm and hence the missed prediction would do less damage. Since, the same percent of imbalance would generate a higher fee for Etherden et al. It also depends on if SvK wants to generate more or less power. If the system wants to produce less energy and the park generate less then predicted, which means that the park helped the system, the spot price is the same price for generating more electricity. This means that there will not be any fee. This is explained for all cases (see Fig.(11)). Hypothetically, it could always be a prediction error without any fee, depending on the systems action at the same hour. As mentioned above, one of the battery cases indicated that it is profitable. The cost contributions are stated in Tab.(4). The varying negative result for the others in this study is probably due to the rapid investment cost decrease for lithium ion. The large difference between the losses in the maximum and minimum case, 511 MSEK, probably origins from that. In Nykvist et al. report from 2015 the lithium ion batteries have more than halved the cost of battery packs for electrical vehicle from 2009 to 2014 [75]. The most interesting conclusion they drawn were that the market price in 2014 was below the predicted price for 2015 [75]. This extreme cost decrease for car batteries have most probably affected the large-scale energy storage industry. In Fig.(14) are the spot price for one day illustrated. The difference between the highest and lowest price is 178 SEK/MWh (0.178 SEK/kWh, 17.8 öre/kWh). Borg did several investment calculations with energy storage solutions. The assumptions were, 10 years payback time with 6% rate and the income would increase with 10 % every year. The battery is cycle once a day with an average profit of 18 öre/kWh. The investment cost was 27.2 MSEK for a 2.4 MWh lithium ion battery. They showed if the arbitrage profit was ∼2 SEK/kWh, they would have profit from having a energy storage. They would also profit if the electricity price was 18 öre/kWh while the investment cost decreased to 2.4 MSEK [18]. The difference between hers study and this study is the fee to Svk, which is not included in hers, and that the capacity is 5 times larger in this study. As noted in this case, for ten years it might be profitable, but probably not. For Borg, 10 year with interest rate and lower investment cost it is not a beneficial solution. If hers is not beneficial, which should be a more accurate economical approach, this adds that this study is most probably not profitable. She concluded that the investment cost needs to decrease and the income needs to increase [18].

38 9.4 Future work From the result and discussion sections it is clear that several assumptions simplified the calculations. However, this simplified case is a non-profitable solution for a five-year period, but it indicated a profit for ten years. It would be interesting to investigate an actual wind farm with measurements in minute basis. Decide how the electronics around the system would be like, such as power conversion electronics, safety systems and how much cables are need. Be able to validate a developed model. Ordering quotation from several retailers and more thoroughly and site specific determined the price for an energy storage. The focus should be to investigate other services that the energy storage can contribute to. Instead of the single use for only profiting the wind farm owner, extend the view to a more network approach. The same battery capacity as in this study can be utilized for more application. From Fig.(9) the red dotted area includes intermittent balancing, power fleet optimization transmission & distribution investment deferral, black start services and it is also close to power quality. The future work should evaluate how the energy storage owner can get payed for these services. Also conduct more economical calculation with interest rates and not only multiplying with the payback time with the annual income and subtract the total investment cost.

39 10 General discussion This case study with a single application were not a cogent choice for increasing the wind farms annual income. This reflects the Swedish energy storage industry that storage is not an competitive option. There have been a pumped hydro storage in Juktan that are now used as a regular hydro power plant [76]. The reconstruction to a regular were due to low profitability of the single use approach. As mentioned there are only one grid connected storage in Sweden that is a test facility with lithium ion system at 75 kW. It is connected in a substation to balance the peak load, increase stability and utilizes surplus energy from a nearby wind farm. This multi-purpose approach should be more economical feasible, than the single use. As my case and Pia Borg showed, the income from utilization of the energy storage needs to increase [18]. Otherwise the alternatives to energy storage are more justifiable e.g. instead of charge or discharge a energy storage only adjust the load on power plant, decrease the reactive power or voltage spikes with filters. One likely scenario that can be energy storage large breakthrough in Sweden is if all the nuclear power plants are shut down. This would result in a loss of a major base load that is needed to be replaced. At an energy storage seminar in Sweden 2016, Helena Nielsen from Vattenfall pointed out that planning for seasonal variations (∼months) requires 15000 MW and 50000000 MWh [77]. Comparing this with the nuclears contribution of 61 TWh in 2016 [78]. This would likely require that more of the hydro power acts as base load and hopefully more renewable will be integrated in the energy mix. The other storage technology with large power capacity is CAES. From the same seminar Magnus Linden from Sweco show ∼30 potential cavities in Sweden that can be used [79]. These cavities were investigated for the final storage for the nuclear waste. Today they are probably filled with water and are in need of reparation, but they still exists. Since the supply is lower, the electricity price will probably increase. One way of solving the deficit is to import electricity from other countries. But for a sustainable solution there must be a more variable production that can follow the demand. The more renewables that are integrated in the system, the more resources are required to keep the frequency in the allowed area. Here is a possibility for the aggregator actor to establish itself on the market. The aggregator’s main idea is to gather a variable load from small producers and consumers. The small loads can origin from households with a micro-production from e.g solar cells. The houses can be equipped with a complementary energy storage. All of this variable load can be gather and sold as a single resource to the electricity market. This aggregator could also own an external energy storage. This aggregator system could provide load levelling services, contribute to the frequency control and help the TSO to postpone grid investment. The benefits from utilizing the small-scale energy storages in the local network would benefit the transmission and distribution systems. In such ways that it would reduce the distribution losses and reduce the grid investments. For the TSO it would also generate more available frequency reserves.

40 The external energy storage should be charged during night when the line is less crowded and discharged at peak hours. For the houses with their own production the storage would be charged from their own production or at night. This would result in a more smooth power demand and lower power requirement during the peak hours. Instead of having to continuously change the power output from the power plants in order to balance the supply and demand. By alternating the power output from the plant the efficiency will probably be lower than optimal. This would also consume more fuel and hence more emission per kWh produced. By changing from the optimal production settings, causes more wear on the equipment and that reduces the lifetime of the power plant [36]. The actor’s entrance on the market probably question how the benefits from energy storage are priced. When the effects from the first actor are published, so that all the economical barriers are identified and the framework has been established. If we assume that it is an affordable solution that the aggregated users benefits financially from. It would probably result in that energy interesting people, convinces their neighborhood to create their own aggregation. Since, the problem with the frequency would most probably lead to more power failures. By also owning an external energy storage they could be having their own local grid online and not be disturbed by others. The people in the neighborhood first buys a battery to participate in the aggregator. The users that does not have any micro-production will probably invest in it, to be more self-sufficient. It could also result in that the TSO experiencing the benefits from the aggregator and they decide to buy batteries to households. They apply the aggregating principle in areas that are in need of new cables or where the grid is often offline. It is interesting how much the battery systems would cost contra the investment with the same benefits. It would probably be more expensive to invest in a battery, but the time from that the decision was made until the results are available is probably shorter. Since they maybe need to invest in a new cables and transformer, which has a long construction time. Bo Nordmark was also on the seminar, he showed that Italy got major problems when a lot of solar cells were integrated into the grid within a short period of time. The grid investments were cheaper per MW than batteries, but it has a deployment time at more than 10 years while batteries have less then one year. They chose batteries because they needed fast effects on the network [80]. As noted in section 3.1, grid owners are not allowed to own and operate a energy storage for an economical interest. They cannot either compensate individual households that experience a weak network, since it violates the non-discriminating framework. Otherwise they need to compensate every costumer connected to their network. Therefore, the present framework in Sweden only allows that the consumer owns it themself or an producer. To summarize, this actor will only exist when the local energy storage is affordable and profitable. The cost for the batteries should decrease and the income for utilization of the storage should increase. The income would increase if the electricity price would be more expansive, but all the other benefits should also generate an income. In the future this will hopefully develop new markets, where the postpone of grid investment will generate an compensation to the contributers.

41 11 Conclusions To conclude this thesis the research questions with answers and the case conclusion is presented. Which energy storage technologies will be most promising in the future? All the technologies have combinations of advantages, disadvantages and features. Depending on the application, the solution needs to posses certain features. Since, not a single energy storage technology can posses all the required features for all the application. Therefore, in the future there will rather be a combination of energy storage for all the different applications. For the seasonal storage PHS and CAES are most promising technologies. The flywheels and supercapacitors for power quality and operating reserves. For the more wide range application such as power fleet optimization and integrate the renewable energy production, batteries in form of lithium ion and sodium-sulfur will most probably be used. What potential applications for energy storage are available for electricity producers? For electricity producers exist both ancillary services and load levelling applications. By replacing the backup diesel generators to energy storage for a black start services. It could ensure power quality (by reducing reactive power). Energy storage could also provide power fleet optimization, to lengthen the power plants life and operate the process in a more efficient way. What effects does a new actor, so-called aggregator, have on the Swedish electricity market? The aggregator actor gather variable load from small-costumers and producers. It could be small residents with some micro production with complementary energy storage. The entrance of this actor would probably penetrate the small scale-energy storages and micro-production. The more micro-production results in more self-sufficient power also contribute to less dependency on the grid. All the energy storages are charged during the night and discharge during peak-loads. This will level out the differences in power demand during a day. It will reduce the losses and reduce the need for grid investments in both the transmission and distribution networks. It would also generate more available frequency reserves and probably change how the market is paying for the generated benefits.

11.1 Case conclusion This case study investigated the profitability of installing a lithium ion battery system with the capacities 12 MW and 18 MWh within an already existing wind farm for a power fleet optimization. The three different prices that were stated in articles resulted in non-profit solution. The conclusion from this case study is that energy storage with a single use is too expensive and the extra income from utilization of the energy storage is not enough for motivate an energy storage investment in SE4.

42 References

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48 A Tariffs The tariff for generating power for the regional level depends on which voltage level it is connected to. There are metering fees, fixed fee, annual power fee, distance dependent fee and general energy compensation. These costs for two cases is stated in Tab.(A1). The two cases are PL2 and PT2, the P stands for production and the number stands for the corresponding voltage level. The L indicates that the production company owns a substation with transformers and miscellaneous equipment. While the network company needs to invest in a cables (lines). The T indicates that the network company owns the substation and the production only needs to invest in a cable.

Table A1. The tariﬀ for deliver electricity to the grid in the regional level. PL2 stands for production and the network company owns the line, in the 50–20 kV level. PT2 stands for production and the network company owns the transformer in the 50–20 kV level. The tariﬀ is from Vattenfall and this applies for all the electric areas [81].

Tariﬀ level Cost PL2 PT2 Metering fee [kSEK/year] 25 25 Fixed fee [kSEK/year] 50 375 Annual power fee [SEK/kW,year] 0 15 Distance-dependent annual power fee 2.01 2.01 [SEK/kW,km,year] General energy compensation [SEK/kWh] -0.0041 0.0053

A.1 B Battery prices

In Tab.(B1) are author, year and total cost for a lithium battery cost. The costs are exchange from the state currency to SEK for 2016. When a cost is not specified it is indicated with "-". In the three first columns in Zakari et al, are the main costs for PCS, Storage section operational & maintenance and replacement presented [65]. The total operational and maintenance costs are calculated with Eq.(21), the discount rate was set 10 % same as in EPRI and SANDIA [57, 82] and 5 years. The total cost is calculated with Eq.(22) and summed for respective energy and power. PCS cost includes power interconnections, cabling and piping. BOP cost includes project engineering, grid connection and system integration, isolation devices, protective devices, land and access, buildings, HVAC system, control system, shipment and installation. Storage section cost includes, vessels, construction and excavation. The two right columns is the total cost for a maximum and minimum case. Note the different in cost between the three left and two right per energy and power. The difference is not explained in the article. In Chen et al. are a price interval stated [26]. The capital cost is otherwise not specified. The price is the useful energy and power, it is adjusted with the efficiency of lithium ion, which is about 100 % [26]. For Kurzweill has only state the price for the energy storage itself [66]. The future for the energy storage is 200 €/kWh, the price in the parentheses is a combination of the total minimum from Zakari. The storage section cost is at 390 is replaced with 200, this give a total cost of 269 $ which is converted to 2547 SEK [66]. For Mimer a 20 MW lithium battery with a discharge time 4 hours. Note that all the costs are defined as dollar per power and not a single cost as dollar per energy. The storage section includes the battery, PCS, control software, thermal management systems, safety systems, pre-engineered racks and containers. The BOP cost includes grid integration equipment, installation, engineering and project management [83].

B.1 Table B1. The total cost of an lithium ion battery system from articles. The values that are marked with a bold font is included in the test interval. The currency is state in the respective articles, are exchange to SEK for 2016.

Authur Zakeri [65] Chen [26] Kurzweil [66] Minear [83] Year,currency 2015, € 2009, $ 2015 € 2020 2017,$ Type Average Max Min Tot max Tot min Max Min Max Min Future PCS [¤/kW] 383 501 161 ------1420 Storage section [¤/kWh] 795 1169 390 - - -- 600 500 200 - BOP [¤/kW] 80 80 80 ------645 Fixed O&M [¤/kW-yr] 6,9 13,7 2 ------B.2 Variable O&M [¤/kWh] 0,0021 0,0056 0,0004 ------Replacement [¤/kW] 369 543 187 ------Total O&M [¤/kW] 28 56 8 ------Capital Cost 491 637 249 2746 2109 4000 1200 - - - 2420 Per-Unit-Power [¤/kW] Capital Cost 795 1169 390 560 459 2500 600 600 500 269 (200) - Per-Unit-Energy [¤/kWh] Capital Cost 4652 6033 2360 26002 19970 35635 10690 - - - 21559 Per-Unit-Power [SEK/kW] Capital Cost 7528 11069 3693 5303 4346 22272 5345 5681 4734 2547 (1894) - Per-Unit-Energy [SEK/kWh] C Annual cycles In this section is the code that determined the amount of cycles for one year. This ﬁrst for-loop sets all small and negative numbers to zero. Since What’s best calculates with decimals, the little number are set to zero. Sometimes the sign changed from positive to negative and this regards the small numbers that were set to zero. The vector LvL with the length n, stores if the energy storage is discharge or charged. f o r i =1:n

i f LvL( i ) <0 LVL_1( i )=0; end

if LvL(i) <0.00001 LVL_1( i )=0; end end

In the second for-loop, the vector LV L1 that contains only positive values are checked if the it is charge, discharge or storing during a hour. If the next value is larger than the present value, which means it is charging, it is represented with a 1. If the next values is smaller than the present values, which means it is discharge, it is represented with a 0. If the next values is equal to the present values it is stored as 2. f o r i =1:n

i f LVL_1( i +1)>LVL_1( i ) LVL_2( i +1)=1; end

i f LVL_1( i +1)

i f LVL_1( i+1)==LVL_1( i ) LVL_2( i +1)=2; end end

To calculate the amount of cycles, it is not important to know which hours it only stores the electricity. But it is interesting to know when is switches from charging to discharging. Therefore in the third for loop, all 2 are set to the previous values.

C.1 f o r i =1:n

i f LVL_2( i )==2 LVL_3( i )=LVL_3( i −1); end end

It this last loop, the vector LV L3 only consists of ones and zeros. If the next value is larger than then previous, it is charging and vise versa for discharging. f o r i =1:n

i f LVL_3( i +1)>LVL_3( i ) charging=charging+1;

end

i f LVL2( i +1)

C.2