IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v143y2025ics0140988325000477.html
   My bibliography  Save this article

An analysis of electrical storage demand and cost in South Australia

Author

Listed:
  • Mountain, Bruce

Abstract

The State of South Australia (SA) currently has twice as much variable renewable electricity (VRE) as the country (Portugal) with the highest proportion globally. This analysis of the relationship between storage and VRE takes account of the evidence of generators' response to market prices in their dispatch decisions. It finds that increasing VRE penetration to around 90 % of end use consumption will be affordable with storage (energy) capacity equal to 0.00044 % of annual demand. However a strategy to fully decarbonise supply through VRE and storage has implied carbon abatement costs far above estimates of the Social Cost of Carbon. This is because very large amounts of seldomly used storage is needed to come close to fully decarbonising supply. Storage costs at around one twentieth current costs reductions will make full decarbonisation through VRE and storage affordable. Pursuing other (non-storage) avenues for decarbonisation such as encouraging a stronger temporal association between electricity demand and VRE supply, zero carbon dispatchable generation, and stationary energy system use of storage in electric vehicles, will be valuable.

Suggested Citation

  • Mountain, Bruce, 2025. "An analysis of electrical storage demand and cost in South Australia," Energy Economics, Elsevier, vol. 143(C).
    • Handle: RePEc:eee:eneeco:v:143:y:2025:i:c:s0140988325000477
    DOI: 10.1016/j.eneco.2025.108224
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0140988325000477
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eneco.2025.108224?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Bistline, John & Blanford, Geoffrey & Mai, Trieu & Merrick, James, 2021. "Modeling variable renewable energy and storage in the power sector," Energy Policy, Elsevier, vol. 156(C).
    2. Schill, Wolf-Peter & Zerrahn, Alexander, 2018. "Long-run power storage requirements for high shares of renewables: Results and sensitivities," Renewable and Sustainable Energy Reviews, Elsevier, vol. 83(C), pages 156-171.
    3. Rey-Costa, Elona & Elliston, Ben & Green, Donna & Abramowitz, Gab, 2023. "Firming 100% renewable power: Costs and opportunities in Australia's National Electricity Market," Renewable Energy, Elsevier, vol. 219(P1).
    4. Zerrahn, Alexander & Schill, Wolf-Peter & Kemfert, Claudia, 2018. "On the economics of electrical storage for variable renewable energy sources," European Economic Review, Elsevier, vol. 108(C), pages 259-279.
    5. Newbery, David, 2018. "Shifting demand and supply over time and space to manage intermittent generation: The economics of electrical storage," Energy Policy, Elsevier, vol. 113(C), pages 711-720.
    6. Schill, Wolf-Peter, 2014. "Residual load, renewable surplus generation and storage requirements in Germany," Energy Policy, Elsevier, vol. 73(C), pages 65-79.
    7. Sinn, Hans-Werner, 2017. "Buffering volatility: A study on the limits of Germany's energy revolution," European Economic Review, Elsevier, vol. 99(C), pages 130-150.
    8. Nestor A. Sepulveda & Jesse D. Jenkins & Aurora Edington & Dharik S. Mallapragada & Richard K. Lester, 2021. "The design space for long-duration energy storage in decarbonized power systems," Nature Energy, Nature, vol. 6(5), pages 506-516, May.
    9. Omar J. Guerra, 2021. "Beyond short-duration energy storage," Nature Energy, Nature, vol. 6(5), pages 460-461, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Javier L'opez Prol & Wolf-Peter Schill, 2020. "The Economics of Variable Renewables and Electricity Storage," Papers 2012.15371, arXiv.org.
    2. Jan Abrell & Sebastian Rausch & Clemens Streitberger, 2022. "The Economic and Climate Value of Flexibility in Green Energy Markets," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 83(2), pages 289-312, October.
    3. Coester, Andreas & Hofkes, Marjan W. & Papyrakis, Elissaios, 2020. "Economic analysis of batteries: Impact on security of electricity supply and renewable energy expansion in Germany," Applied Energy, Elsevier, vol. 275(C).
    4. Martin Kittel & Wolf-Peter Schill, 2024. "Measuring the Dunkelflaute: How (not) to analyze variable renewable energy shortage," Papers 2402.06758, arXiv.org, revised Aug 2024.
    5. Zerrahn, Alexander & Schill, Wolf-Peter & Kemfert, Claudia, 2018. "On the economics of electrical storage for variable renewable energy sources," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 108, pages 259-279.
    6. Majidi, Hassan & Hayati, Mohammad Mohsen & Breyer, Christian & Mohammadi-ivatloo, Behnam & Honkapuro, Samuli & Karjunen, Hannu & Laaksonen, Petteri & Sihvonen, Ville, 2025. "Overview of energy modeling requirements and tools for future smart energy systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 212(C).
    7. Martin Kittel & Wolf-Peter Schill, 2021. "Renewable Energy Targets and Unintended Storage Cycling: Implications for Energy Modeling," Papers 2107.13380, arXiv.org, revised Sep 2021.
    8. Reinhard Haas & Claudia Kemfert & Hans Auer & Amela Ajanovic & Marlene Sayer & Albert Hiesl, 2022. "On the economics of storage for electricity: Current state and future market design prospects," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 11(3), May.
    9. Gerbaulet, Clemens & von Hirschhausen, Christian & Kemfert, Claudia & Lorenz, Casimir & Oei, Pao-Yu, 2019. "European electricity sector decarbonization under different levels of foresight," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 141, pages 973-987.
    10. Behrang Shirizadeh, Quentin Perrier, and Philippe Quirion, 2022. "How Sensitive are Optimal Fully Renewable Power Systems to Technology Cost Uncertainty?," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1).
    11. Helm, Carsten & Mier, Mathias, 2021. "Steering the energy transition in a world of intermittent electricity supply: Optimal subsidies and taxes for renewables and storage," Journal of Environmental Economics and Management, Elsevier, vol. 109(C).
    12. Auguadra, Marco & Ribó-Pérez, David & Gómez-Navarro, Tomás, 2023. "Planning the deployment of energy storage systems to integrate high shares of renewables: The Spain case study," Energy, Elsevier, vol. 264(C).
    13. Wiese, Frauke & Schlecht, Ingmar & Bunke, Wolf-Dieter & Gerbaulet, Clemens & Hirth, Lion & Jahn, Martin & Kunz, Friedrich & Lorenz, Casimir & Mühlenpfordt, Jonathan & Reimann, Juliane & Schill, Wolf-P, 2019. "Open Power System Data – Frictionless data for electricity system modelling," Applied Energy, Elsevier, vol. 236(C), pages 401-409.
    14. Abrell, Jan & Rausch, Sebastian & Streitberger, Clemens, 2019. "Buffering volatility: Storage investments and technology-specific renewable energy support," Energy Economics, Elsevier, vol. 84(S1).
    15. Sinn, Hans-Werner, 2017. "Buffering volatility: A study on the limits of Germany's energy revolution," European Economic Review, Elsevier, vol. 99(C), pages 130-150.
    16. Fabian Stöckl & Alexander Zerrahn, 2023. "Substituting Clean for Dirty Energy: A Bottom-Up Analysis," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 10(3), pages 819-863.
    17. Liebensteiner, Mario & Haxhimusa, Adhurim & Naumann, Fabian, 2023. "Subsidized renewables’ adverse effect on energy storage and carbon pricing as a potential remedy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 171(C).
    18. Klaus Eisenack & Mathias Mier, 2019. "Peak-load pricing with different types of dispatchability," Journal of Regulatory Economics, Springer, vol. 56(2), pages 105-124, December.
    19. Sánchez-Pérez, P.A. & Staadecker, Martin & Szinai, Julia & Kurtz, Sarah & Hidalgo-Gonzalez, Patricia, 2022. "Effect of modeled time horizon on quantifying the need for long-duration storage," Applied Energy, Elsevier, vol. 317(C).
    20. Helm, Carsten & Mier, Mathias, 2019. "Subsidising Renewables but Taxing Storage? Second-Best Policies with Imperfect Carbon Pricing," VfS Annual Conference 2019 (Leipzig): 30 Years after the Fall of the Berlin Wall - Democracy and Market Economy 203539, Verein für Socialpolitik / German Economic Association.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eneeco:v:143:y:2025:i:c:s0140988325000477. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eneco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.