Are there conflicts between energy storage auxiliary services and charging and discharging arbitrage

Can a battery energy storage system deliver fast frequency response and Energy Arbitrage?

This paper examines whether a battery energy storage system (BESS) can provide both fast frequency response and energy arbitrage. A techno-economic model is developed to simulate 600 possible fast frequency response availability windows.

What does 'arbitrage' mean in this context?

The term ‘arbitrage’ is used loosely in this and the next sections to also describe the case where the BESS solely supplies – but does not buy from – the wholesale market. Energy to power ratio (E/P) of energy storage is the maximum amount of energy that can be stored in a storage system (MWh) divided by the nominal power rating of the system (MW).

What is the synergy between fast frequency response and Energy Arbitrage?

Synergies between fast frequency response and energy arbitrage are studied. A battery management strategy is developed to leverage value from these services. Most arbitrage revenues can be captured without foregoing frequency response payments. Delivering fast frequency response together with arbitrage can increase operating profits by 25%.

Are auxiliary services a revenue source for energy storage?

However, the currently measurable revenue sources related to auxiliary services from energy storage devices only include peak shaving, frequency regulation, and system reserve services. Therefore, in this study, we have constructed a revenue model for energy storage based on the five revenue sources observed in the Chinese power market.

What is the arbitrage profit model of energy storage?

The arbitrage profit model of energy storage, characterized by low charging during periods of low electricity market prices and high discharging during periods of high electricity market prices, aims to capitalize on the price difference to generate profits.

Is energy storage revenue derived from arbitrage and subsidy mechanisms?

Existing research predominantly focuses on assessing the revenue derived from arbitrage and subsidy mechanisms associated with energy storage. Few studies have comprehensively appraised the overall revenue and return on investment for different energy storage types in the power market.