Energy Storage Co-optimization: 3 Things You Need to know to Create Value Streams
By Adam Todorski
As energy storage becomes cheaper and more plentiful, fully utilizing battery storage deployments requires value-stream co-optimization. In this post, we’ll discuss some of the challenges and opportunities we’ve experienced as we help our utility customers deploy and co-optimize larger energy-storage portfolios.
Value-stream co-optimization is critical to the management of distributed energy-storage assets, whether for distribution support (e.g., non-wires alternatives) use cases or for capturing merchant value streams through virtual power plants (VPPs). Increasingly, these categories of value streams (NWA and VPP) are found in the same installation or fleet of installations. Expanding these optimizations to fleets of resources that may consist of more than just battery storage is key to preventing legacy demand response programs and resources from becoming stranded assets.
To fully leverage these value streams, electric utilities require software that can serve a variety of use cases and optimizations. Through our AutoGrid Flex™ flexibility management platform, electric utilities can produce a number of distribution, transmission, merchant and site value-stream use cases and optimizations.
Co-optimizing for different value streams
AutoGrid’s customers are deploying battery energy storage at all scales. These deployments cover numerous use cases. They range from fleets of small residential devices that are co-optimized by AutoGrid Flex to perform multiple local and portfolio level functions, to massive standalone devices used for primary frequency response.
All of these projects make economic sense only when multiple value streams are not just stacked but also co-optimized. Leveraging AutoGrid Flex and its advanced machine learning platform, for example, the utility can maximize value while ensuring that capacity for critical uses is reserved at all times. These scenarios increasingly overlay distribution value streams with merchant value streams, which creates a set of complicated objective functions – driving the need for platforms such as AutoGrid Flex to manage the complexity.
Of particular interest to distribution utilities, especially in the United States and Canada, are projects that provide rate-base benefits. These may include deferral of capital upgrades (e.g., NWA) as well as customer-facility or market benefits, which may in turn benefit operating margins by offsetting supply cost.
For example, we’ve onboarded a distribution utility customer–storage asset that is part of a microgrid in order to reduce demand on a distribution circuit. This was achieved by monitoring circuit amperage in real time and dispatching the storage asset in accord with various constraints defined in the system. This installation can also island from the grid and provide photovoltaic output time-shifting.
Leveraging machine learning
While this particular microgrid-asset project lay within a regulated wholesale market, many of our customers are located in regions with deregulated markets. Thus, they can take advantage of the advanced machine learning–based co-optimization provided by AutoGrid Flex. This allows them to solve for maximizing merchant market revenue while maintaining dispatchable capacity for NWA load shifting or system reliability.
One such customer project, slated to go live later this year, overlays dispatchable capacity for wholesale energy value streams and primary frequency response. It does this first as a standalone asset and later as a fleet of storage, distributed generation and load assets. For this deployment, AutoGrid is providing a turnkey solution covering site-control hardware, wholesale market telemetry and cloud-based big-data optimization and API interfaces to the customer’s trading desk.
Connecting to flexibility-management platforms
Battery storage devices are most valuable when connected directly to a platform like AutoGrid Flex. Some value streams require that the storage assets (or other assets) are continuously steered through real power set-points delivered every few seconds. But most value streams require steering on a time scale of around 60 seconds to realize maximum value.
Utilities and other companies participating in the electricity space will require more interconnectivity and interoperability within their systems and networks to maximize the value of their assets. AutoGrid can provide direct-to-hardware as well as platform-to-platform integration solutions to achieve a variety of distribution, transmission, merchant, and site value-stream use cases and optimizations between various combinations of these.