Merit Order of Energy Storage in Germany by 2030

Transcription

1 Merit Order of Energy Storage in Germany by 23 Workshop Distributed Energy Resources and Storage The Czech Academy of Sciences Prague, 29 th of November 216 1

2 2 The Research Center for Energy Economics

3 members evolution background The Research Center for Energy Economics (FfE) Independent institution dealing with topics related to energy technology and energy economics Research results can be published independently from political orientations or regulations solely based on scientific analytical methods Founded 1949 in Karlsruhe Moved to Munich in 1969 Affiliated company: FfE GmbH since 21 Further training for more than 3 scientists About 3 theses every year More than 3 successful dissertations main features 3 Members from the energy sector, industry, science, administration and private members Active exchange of experiences, involvement in a network of knowledge, direct contact to scientific assistants Current topics: storage and grids, electromobility, energy markets, energy efficiency Methods: system analyses and simulations, data mining, GIS-models, audits research

4 4 Members of FfE e.v.

5 5 Merit Order of Energy Storage in Germany by 23

6 Content Introduction Functional Energy Storage Excursion: Will seasonal storage play a major role by 23? Merit Order Matrix of Energy Storage 5 6 Key results from MOS 23 Conclusions 6

7 Understanding the meaning of Merit Order Common Association Merit Order of Power Plants Sorting of Power Plants according to their Marginal Costs, in order to determine the short term dispatch Generalized Understanding Merit Order sort according to value How shall the value be assessed? 7

8 In Energy Economics this assessment can be done via the three goals of the energy policy triad security of supply competitiveness environmental protection Welfare Business 8

9 Key Questions address the Welfare- and Business Perspective for the development of the Future Energy System Infrastructure 9 Energy System Infrastructure: power plants, grid, storage Framework defined by e.g.: CO 2 -aims, RES-expansion Business point of view: revenue and contribution margin Market design e.g.: regulatory framework condition, subsidies 1

10 From the answers of the Key Questions Changes in Market design can be deduced Welfare / Cost-Perspective Which system infrastructure is most favorable under given framework conditions from a cost perspective for the electricity supply system? Business Perspective Which system infrastructure will emerge under given framework conditions from a business perspective? Energy System Infrastructure Changes in Market design in order to unify the results of both perspectives. 1 Energy System Infrastructure: power plants, grid, storage Framework defined by e.g.: CO 2 -aims, RES-expansion Business point of view: revenue and contribution margin Market design e.g.: regulatory framework condition, subsidies 1

11 Storages can be found in three different sectors which are about to be interconnected more and more 1 electricity 2 3 Need for a concept which also allows for a comparison of storage technologies that work along the interfaces of the three sectors. heat mobility 11

12 Storage Power in GW Leistung/Last Power/Load in in GW GW The Concept of the Functional Energy Storage Stunde im Jahr Hour hour of the year Year Negative Residual-Load Residual-Load Renewable Energies CHP Flexibile CHP Renewable + CHP All modifications of electrical demand and of primarily inflexible electrical energy production applied to adjust demand and supply can be interpreted as functional energy storage. The difference of inflexible and flexibilized load curve equals the charging and respectively decharging of the functional energy storage Hour of the Year

13 Energy Energie [TWh] in TWh Energie Energy in [TWh] Will seasonal storage play a major role by 23? 13 Weekly balance of variable production for the weatheryear 212 Forschungsverbund: Peak load 23: 79,5 GW Consumption: 486 TWh There is a reduction of the overall consumption including roll out of electromobility and heat pumps. NEP: Peak load 23: Consumption: 85,3 GW 538 TWh There is no reduction of the overall consumption including roll out of electromobility and heat pumps. 23, MOS Forschungsverbund Surplus 23, MOS NEP Surplus FfE MOS-RegMod_ Woche des Jahres Week of year yearly max. weekly 24,3 TWh 4,8 TWh FfE MOS-RegMod_ Woche des Jahres Week of year yearly max. weekly 14,2 TWh 3,8 TWh Wind PV Hydropower Biomass Must Run Consumption No need for seasonal storages Week-to-week storages could be useful for 2 1 weeks per year

14 The system and the business perspective System Perspective Business Perspective 14

15 Merit Order Matrix - Methodology Energy System Functional Storage Technologies Stakeholders Applications from Welfare Perspective (1) REQUIREMENTS (2) DEMAND (3) REFERENCE COSTS (1) TECHNICAL PARAMETERS (2) POTENTIAL (3) COSTS Techno-Economic Parameters Applications from Business Perspective (1) REQUIREMENTS (2) DEMAND (3) BENEFITS 15

16 Profitability for Stakeholders (Business Perspective) Merit Order Matrix Structure Target Corridor for Market Design Explanation: Technology Main application (economy) / Main appl. (stakeholder) = application from economy and stakeholder perspective are compatible = diverging application from economy and stakeholder perspective CAES HP NSH CHP V2G = compressed air energy storage = heat pump = night storage heater = combined heat and power = vehicle-to-grid 16 Added Value for the Economy (Welfare Perspective) Profitability Index PI: PI = (annual profits an. costs) / an. costs PI > profits > costs PI = 1 profits = 2*costs

17 Profitability for Stakeholders Merit Order Matrix Cluster Technical Data 23 Market Data Portfolio of Applications No adapation necessary as little additional value IV Adaption necessary No adaption necessary as already in target corridor I Added Value for the Economy II Adaption necessary in order to reach target corridor III Pumped Storage Load-levelling / Spot market CAES (diab. & adiab.) Load-levelling / Frequency control Battery Storage Systems (Li-Ion) Frequency control / Frequency control Home Storage Systems Load-levelling / Increase of on-site consumption Controlled Charging (min. & max. driving perform. & V2G) Load-levelling / Spot market Shifting Appliances (White Goods & Refrigeration) Load-levelling / Increase of on-site consumption Shifting Power2Heat in Households (HP & NSH) Frequency control / Frequency control Power2Heat in Households (hybrid heating syst.) Frequency control / Frequency control CHP + Heat Storage Load-levelling / Spot market Power2Heat + Heat Storage Frequency control / Frequency control Load Shifting in Industry (energy-intensive) Load-levelling / Industrial peak shaving Load Shifting in Industry (cross-sect. technologies) Load-levelling / Industrial peak shaving Power2Gas (H 2 und CH 4 ) Frequency control / Frequency control

18 Capacity payments in mio. /year Kosten der Leistungsvorhaltung in Mio. /Jahr Merit Order Matrix - Uncertainties with regard to frequency control 9 pmrl nmrl psrl nsrl PRL FfE 18 Regelleistung_ From 213 to 214 a strong decrease in revenues für nsrl can be observed (among other reasons due to an increasing competition of Power2Heat) PRL revenues increase since 212 however battery systems are already today economically viable for PRL Uncertainties with regard to future revenues

19 Profitability for Stakeholders Merit Order Matrix Cluster w.o. frequency control Target Corridor for Market Design Added Value for the Economy Pumped Storage Load-levelling / Spot market CAES (diab. & adiab.) Load-levelling / Spot market Battery Storage Systems (Li-Ion) Load-levelling / Industrial peak shaving Home Storage Systems Load-levelling / Increase of on-site consumption Controlled Charging (min. & max. driving perform. & V2G) Load-levelling / Spot market Shifting Appliances (White Goods & Refrigeration) Load-levelling / Increase of on-site consumption Shifting Power2Heat in Households (HP & NSH) Load-levelling / Spot market Power2Heat in Households (hybrid heating syst.) Load-levelling / Spot market CHP + Heat Storage Load-levelling / Spot market Power2Heat + Heat Storage Load-levelling / Spot market Load Shifting in Industry (energy-intensive) Load-levelling / Industrial peak shaving Load Shifting in Industry (cross-sect. technologies) Load-levelling / Industrial peak shaving Power2Gas (H 2 und CH 4 ) Load-levelling / Spot market

20 Apart from various methodological approaches and model improvements these are the Top 5 Key Results 1 2 Power to heat in public and industrial district heating systems as well as flexibilisation of load in industrial processes offer the largest benefit on the transmission level from a system perspective. In the study, expansion of functional energy storage reduces curtailment of up to 8 TWh Calculations show that usage of functional energy storage increases operation hours of base load power plants. Advances in technology and changes in market design will guarantee system stability in the future. The existing regulatory framework leads to non-negligible additional costs for the system. 2

21 Leistung Power in [GW] Kapazität Capacity in [GWh] GWh This graph shows the installed storage technologies w.r.t. the power and capacity for the reference scenario 6 5 NASA2N NASA25N 3, 2,5 4 NASA3N 2, 3 1,5 2 1 Capacity Kapazität Power Leistung 1,,5 Night Flexibilisierung Storage Heater Nachtspeicherheizungen Thermal Thermische Storage Speicher DSM DSM energy strom- intensive Industrie DSM DSM Querschnittstechnologien cross sectional Power2Heat public öffentliche district Versorgung heating FfE MOS_518 Power2Heat industrial Industrie district heating, Conclusion: DSM is used with total available capacity The total amount of power2heat increases every year 21

22 Leistung Power in [MW] Influence of grid scenario on storage demand NASA25N NASA3N NBSA25N NBSA3N Stronger Grid Conclusion: Only if grid restrictions are taken into account a flexibilization of night storage heaters is of use in NASA3K Independent of the scenario the DSM potential is always used to it s maximum FfE MOS_412 A better grid allows for a better access to Power2Heat potentials in the south Speichertyp storage type 22

23 Apart from various methodological approaches and model improvements these are the Top 5 Key Results 1 2 Power to heat in public and industrial district heating systems as well as flexibilisation of load in industrial processes offer the largest benefit on the transmission level from a system perspective. In the study, expansion of functional energy storage reduces curtailment of up to 8 TWh Calculations show that usage of functional energy storage increases operation hours of base load power plants. Advances in technology and changes in market design will guarantee system stability in the future. The existing regulatory framework leads to non-negligible additional costs for the system. 23

24 Mehrkosten im System in Mio. /a Mehrkosten Added system im costs System in in Mio. Mio. /year /a Taxes and fees influence the overall system costs Taxes and fees depending on the scenario Scenario Pumped hydro storage 35 Power2Heat 3 25 H 2,85 /MWh 113,66 /MWh 2 H* 2,85 /MWh 26,26 /MWh 15 S1 1,89 /MWh 26,26 /MWh 1 S2 35,89 /MWh 26,26 5 /MWh V2 H V2 H* V3 V2 H V3 V2 H* V3 V3 S1H V3 S2 H* V3 S1 V3 S2 Conclusion: Potential for cost saving is in the same magnituded as in the frequency control marekts In comparison to the costs of grid expansion and the EEG-fee the extra costs are very low 24

25 Vollbenutzungsstunden Full load hours in h in h Taxes and Fees reduce the commitment of PHS and P2H. At the same time NSH and HP are flexibilised. Taxes and fees depending on the scenario Scenario Pumped hydro storage Power2Heat H 2,85 /MWh 113,66 /MWh H* 2,85 /MWh 26,26 /MWh S1 1,89 /MWh 26,26 /MWh V1 V3 S1 V3 S2 S2 35,89 /MWh 26,26 /MWh 5 25 Pumpspeicher Pumped (Bestand) Hydro Storage (stock) Flexibilisierung Heat Wärmepumpen Pumps Flexibilisierung Night Storage Nachtspeicherheizungen Heater Thermische Thermal Speicher Storage DSM stromintensive energy Industrie intensive DSM DSM Querschnittstechnologien cross sectional Power2Heat public öffentliche district Versorgung heating Power2Heat Industrie industrial district heating

26 Conclusions for 23 Overall statement The need for energy storage is not only technically driven, but also economically and - in the long run - ecologically Energy storage will play a major role in: lowering system costs Integration of more renewables into the energy system lowering CO 2 -Emissions on the long run Energy storage will play a minor role in: Security of supply Recommendations 26 attractive business cases for the use of Power2Heat needed Further improvements in market design like shorter lead times and block trade lengths Identification of flexibility potentials e.g. by learning flexibility networks Merit Order of storage, grid expansion, efficiency and renewables

27 Thank you for your attention and the support of 27 contact: Christoph Pellinger Download of the study: