The impact of electricity storage on wholesale electricity prices
AbstractThis paper analyzes the impact of electricity storage on the production cost of a power system and the marginal cost of electricity (electricity price) using a unit commitment model. Also real world data has been analyzed to verify the e®ect of storage operation on the electricity price using econometric techniques. The unit commitment model found that the deployment of a storage system reduces the fuel cost of the power system but increases the average electricity price through its e®ect on the power system operation. However, the reduction in the production cost was found to be less than the increase in the consumer's cost of electricity resulting in a net increase in costs due to storage. Di®erent storage and CO2 price scenarios were investigated to study the sensitivity of these results. The regression analysis supports the unit commitment results and ¯nds that the presence of storage increases average wholesale electricity prices for the case study system.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 34941.
Date of creation: 08 Oct 2011
Date of revision:
Electricity storage; Electricity price; Production cost;
Other versions of this item:
- Nyamdash, Batsaikhan & Denny, Eleanor, 2013. "The impact of electricity storage on wholesale electricity prices," Energy Policy, Elsevier, vol. 58(C), pages 6-16.
- P28 - Economic Systems - - Socialist Systems and Transition Economies - - - Natural Resources; Environment
- D4 - Microeconomics - - Market Structure and Pricing
- Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
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