The province of Alberta plans to green energy production to reduce greenhouse gases by 37 megatonnes annually by 2050. Expansion of Alberta’s use of alternative sources of energy, including wind and solar power, can play a role in this reduction; but this will present a challenge to the province’s electricity system because the variability of wind and solar power cannot be controlled by the system operator.
But what if the energy derived from the wind and the sun could be stored for ‘dispatch’ into the grid when it was needed? Clearly, this could help the grid, but could the operator of the wind or solar facility also benefit?
Alberta Innovates - Technology Futures (Tech Futures) assembled a team to investigate this question. We asked ourselves:
- What is the current state of industrial-scale energy storage technology?
- Which storage technologies appear to be most economically and technically feasible for an intermittent power source delivering into Alberta’s electric system?
From a system standpoint, storage could be installed anywhere on the grid and used by any generator. Storage could balance power supply and demand in real-time, across intervals ranging from milliseconds to hours. In the past, pumped hydro storage helped highly-centralized grids move energy from night to day to level the load on the generating stations. Tomorrow’s grids will be more dispersed, with a profusion of smaller, intermittent power sources; the roles of energy storage will be more diverse, and there will be many competing technologies to choose from. However, this first study focused on the simplest configuration: a wind farm with its own storage capability.
Note: the report of this project does not represent Government of Alberta policy, nor does it anticipate or imply any future policy direction of the Government of Alberta.
Find out more about this project via the links below:
Project Objectives
- Assess the maturity and cost of various energy storage technologies;
- Review Alberta’s markets for electricity (energy market and ancillary services markets);
- Provide an overview of the wind generators participating in Alberta markets;
- Deduce the potential opportunities for those generators to exploit energy storage technologies to economic advantage;
- Select eight case studies for economic modelling;
- Conduct a financial analysis, using hourly historical electricity market data to determine optimal storage operation rules and estimate the costs and benefits of pursuing the opportunities identified.
Project Management Structure
Tech Futures led the project team and managed the project, reporting to a Steering Committee. The Steering Committee membership included representatives of government, industry and the Alberta Electric System Operator.
Steering Committee Members
Project Team
Tech Futures assembled a team to investigate the potential value of different energy storage technologies to individual wind producers in Alberta, given the characteristics of Alberta’s electricity market and current provincial regulations and policies.
- Tech Futures – technology assessment and project management
- Carlson Consulting & Analysis – electricity markets analysis
- BECL & Associates – economic modelling
Project Outline
The project was managed in two phases, with the results of the first phase being used to determine the scope of the second phase. The phase 2 scope was approved by the Steering Committee. Stakeholders were given the opportunity to provide feedback on the results of phase 1, and will be engaged again at the end of phase 2. The total project duration was 10 months.
Phase One Scope:
- Assess the maturity and cost of various energy storage technologies;
- Review Alberta’s markets for electricity (energy market and ancillary services markets);
- Provide an overview of the wind generators participating in Alberta markets;
- Deduce the potential opportunities for those generators to exploit energy storage technologies to economic advantage;
- Select up to eight case studies for economic modelling in Phase Two.
Phase Two Scope:
Conduct a financial analysis, using hourly historical electricity market data to determine optimal storage operation rules and estimate the costs and benefits of pursuing the eight opportunity cases identified in Phase One. These eight opportunities were based on the outcomes of the analysis in Phase One and steering committee recommendations.
Stakeholder Session
Over 60 stakeholders attended the presentation of the results of the Energy Storage: Making Intermittent Power Dispatachable study on October 21, 2011. The majority of participants were wind generation operators along with technology developers, academics and association representation.
The objective of the study was to investigate the potential value of different energy storage technologies to individual wind producers in Alberta, given the characteristics of Alberta’s electricity market and current provincial regulations and policies. AITF and its multidisciplinary team of experts (Carlson Consulting & Analysis and BECL & Associates) undertook market economics, technology review, and operational analysis for this study. This study found a wide range of potential benefits from energy storage throughout power systems.
In the case of dispatchablity, the study selected Compressed Air Energy Storage (CAES) and NaS batteries for modelling. The hindcast model of wind and storage suggests significant increased revenue in all cases. Time shifting appears more profitable than firming. Storage could support wind farm capacity increase without transmission upgrade.
The study also produced a preliminary investment appraisal that suggests storage costs could, under certain market conditions, be of a similar order to the revenue increase generated. It found CAES cheaper than batteries at scale. Energy time-shifting is generally considered a relatively unattractive financial opportunity. A wind and energy storage project could improve its economic outcomes by participating in several markets, but the operational algorithm would be challenging to optimize.
The session concluded with the presentation of eight areas that could be candidates for further work in energy storage in Alberta. These areas are:
Storage size optimization
- What are the optimum power (MW) and energy (MWh) capacities for supporting a wind farm of a given nameplate capacity?
- Would lead to better cost estimates for a business case.
Inside-the-fence merchant storage
- Could a wind farm’s storage-enabled additional revenue be further enhanced by allowing the storage to be charged from the grid?
- Would address market mechanism for buying as well as selling.
Ancillary services market participation
- Could storage enable a wind farm operator to participate in reserve markets?
- Would assess technical qualifications of storage technologies, and energy management strategies for multi-tasking.
- Would open questions of offset credits for Low Carbon Ancillary Services (LCAS) transactions.
Nameplate capacity enhancement
- Could storage enable turbine capacity upgrade without exceeding transmission peak load?
- Would derive relationship between storage capacity required and transmission capacity factor achievable.
Intertie congestion relief
- Could storage relieve BC intertie congestion as PNNL suggested?
- Opportunity for interprovincial collaboration.
- Additional commercial question: private sector import/export brokers?
Storage as a system resource
- What is the optimal way to include storage in Alberta’s electricity system?
- Would be a whole-system model. Very broad question that may need to be staged or refined.
Storage at an industrial load centre
- Literature suggests storage may be best sited close to load. Industrial load is significant in Alberta: could storage bring economic benefits to large consumers?
- What would be the optimal commercial arrangements for operating the storage?
Storage at a community load centre
- Some communities are enthusiastic about renewables. Could storage help them realize their ambitions?
Click Report to read more about the study and areas recommended for further work. You can provide your comments and feedback by participating in the Energy Storage Study Survey.
Project Results
Project Timeline
| Time |
Milestone |
| January 28, 2011 |
First Steering Committee meeting and project commencement |
| April 24, 2011 |
Phaste 1 completed
Steering Committee meeting
Phase 2 plan approved |
| April 28, 2011 |
Targeted Stakeholder Sessiom
26 attendees (11 from wind industry) |
| August 25, 2011 |
Phase 2 modelling completed |
| September 2, 2011 |
Draft final report to Steering Committee |
| October 14, 2011 |
Final report publication |
| October 21, 2011 |
Public Stakeholder Session |