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Buildings as Batteries

Author

Listed:
  • Alejandro Lopez
  • Derek Bunn

Abstract

Aggregators are increasingly using portfolios of various end-user resources such as local renewable generation, batteries, EVs, and demand-side management to participate in the electricity markets as virtual power plants. Whilst the smart control of energy within buildings is well established for cost optimization, the prospect of an aggregator collaborating with the energy managers of buildings to trade electricity in the wholesale markets is under researched. This paper uses a state-of-the-art architectural simulator to model the thermal inertia of a typical high-rise building in London and represent the thermodynamics of its hourly occupancy and weather responses. The building is simulated as a virtual battery by manipulating the HVAC settings. Price arbitrage on the electricity wholesale market and contracting with the local distribution network for flexible reserve services are both feasible and profitable. It is concluded that aggregators can apparently use buildings as additional assets within their trading portfolios. JEL Classification: L85 and L94.

Suggested Citation

  • Alejandro Lopez & Derek Bunn, 2025. "Buildings as Batteries," The Energy Journal, , vol. 46(1), pages 67-92, January.
    • Handle: RePEc:sae:enejou:v:46:y:2025:i:1:p:67-92
    DOI: 10.1177/01956574241280818
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities

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