IEEE Power & Energy Magazine - September/October 2017 - 32

Opportunities for E
Assessing Whole-System Economic Benefits
of Energy Storage in Future Electricity Systems

A

ANY COST-EFFECTIVE TRANSITION TOWARD LOW-CARBON ELECTRICITY SUPPLY
will necessitate improved system flexibility to address the challenges of increased balancing requirements and degradation in asset use. Energy storage (ES) represents a flexible option that can bring significant, fundamental economic benefits to various areas in the electric power sector, including reduced
investment requirements for generation, transmission, and distribution infrastructure as well as reduced
system operation and balancing costs. The additional flexibility offered by ES could also significantly
reduce the requirement for investment in low-carbon generation capacity while achieving the established carbon intensity targets. Moreover, ES may present significant option value, as it can provide
flexibility for dealing with uncertainty in future system development.
However, market and regulatory barriers may prevent the realization of quantifiable system value in
cases where an ES asset cannot access the entire range of system services. Developing fully cost-reflective markets and effective regulatory frameworks-achieved by establishing a level playing field between
investment in traditional network/generation solutions and investment in ES-is therefore necessary to
ensure that commercial incentives for investing in and operating ES are aligned with its societal benefits.

Overview
Transforming the electricity sector in the United Kingdom over the coming decades toward a lowcarbon system poses significant challenges. According to government plans, significant carbon reductions expected by 2030 will be based on deploying renewable and nuclear generation technologies
combined with electrifying segments of the heat and transport sectors. Traditional business-as-usual
infrastructure planning along with a high penetration of variable and inflexible low-carbon generation
may result in prohibitive system integration costs, curtailment of low-carbon generation (potentially
exceeding 25% in 2030), and significant degradation in infrastructure asset utilization (from 55%
today to less that 30% in 2030). In this context, technology options such as ES, demand-side response
(DSR), and flexible power generation could provide the versatility to reverse these trends.
Our recent studies suggest that ES technologies may have a significant role to play in facilitating
the cost-efficient transition to a low-carbon power system. ES could deliver cost savings across the
electricity system by offsetting the need for generation and network investment while at the same time
contributing to operating cost savings. In this context, the pioneering demonstration project Smarter
Network Storage, led by UK Power Networks, explored the capabilities of a grid-scale battery storage
device in deferring traditional network reinforcement, while also providing national-level balancing
services. Figure 1 shows the battery storage facility (6 MW, 10 MWh) installed as a key part of this
project in the U.K.'s Leighton Buzzard substation.
Digital Object Identifier 10.1109/MPE.2017.2708858
Date of publication: 17 August 2017

32

ieee power & energy magazine

1540-7977/17©2017IEEE

september/october 2017



Table of Contents for the Digital Edition of IEEE Power & Energy Magazine - September/October 2017

IEEE Power & Energy Magazine - September/October 2017 - Cover1
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IEEE Power & Energy Magazine - September/October 2017 - Cover3
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