EURO 2024 Copenhagen
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542. Security of supply in the transition to economically viable large-scale electricity storage

Invited abstract in session TB-19: The role of storage in energy problems, stream OR in Energy.

Tuesday, 10:30-12:00
Room: 44 (building: 116)

Authors (first author is the speaker)

1. Ann van Ackere
HEC, University of Lausanne
2. Erik Larsen
Department of Management, Aarhus University

Abstract

While electricity storage is pivotal in the move away from fossil fuel-based generation to renewables, its roll-out might have undesirable side-effects. We develop a system dynamics simulation model to investigate the impact of introducing large-scale, economically viable storage, on security of supply during this transition period.
As efficient storage options partly mitigate the intermittent nature of renewables such as wind and photovoltaics, their capacity factor will go up, resulting in an increased derated capacity margin, and thus a reduced need for future investments. However, the speed of the technological evolution that will enable large-scale viable storage, and the implementation rate, are hard to predict. Incorrect anticipation of future capacity factors could lead to a complicated transition period.
If investors are over-optimistic regarding the speed of this evolution, they are likely to overestimate the efficiency of existing renewable generation and be reluctant to invest, leading to capacity adequacy problems and a risk of shortages, if not blackouts. On the contrary, underestimating the speed of this evolution would lead to costly over-capacity.
The model allows us to investigate different scenarios based on investors’ anticipations, initial share of renewables, etc. We observe capacity shortages in some scenarios, while others indeed generate significant excess capacity. Furthermore, we argue how the regulator might mitigate some of these issues.

Keywords

Status: accepted

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