A Best-effort Energy Storage as a Service Model for Supporting Renewable Generators in Day-ahead Electricity Markets

Net zero targets are encouraging higher adoption of Renewable Energy Generators (REGens). The volatile nature of these sources introduces challenges such as reliability of supply and grid stability. Energy storage systems (ESS) are viewed as a solution to address these challenges at both grid-scale renewable generation and smaller distributed generation. In this paper, we propose a model for an ESS to offer its storage to multiple, independently-managed, third-party REGens participating in the day-ahead electricity markets. In anticipation of the forecast errors from these disparate REGens, the ESS operator takes suitable counter-measures (charging/ discharging of the storage system through market transactions). This is done in a way to reduce the imbalance in the market commitments made by the individual REGens without reserving any storage volume for each REGen. For this service, the ESS gets paid from each of the REGens. We call this set-up as a “best-effort energy storage as a service (ESaaS)”. To the best of our knowledge, ours is one of the very few papers to discuss this set-up. We present strategies for pricing and operating such an ESaaS system. Empirical results using real world data indicate that the proposed set-up is beneficial for both REGens and ESS operators. It also reduces the total imbalance (of REGens and ESS) thus aiding the system operator as well.