March 15, 2021
Journal Article

An economic assessment of behind-the-meter photovoltaics paired with batteries on the Hawaiian Islands

Abstract

Due to the natural variability and uncertainty, the ever-increasing penetration of solar generation in Hawaii presents challenges to power grid operators to maintain reliable system operation. Demand response (DR) has the potential to be a cost-effective tool for Hawaii to reach its aggressive renewable energy goals while maintaining the reliability of power grids. The Hawaii Public Utility Corporation has approved the Hawaiian Electric Company’s revised portfolio of DR programs. The companies are in the process of developing tariffs, rate schedules, and grid services purchase agreements. This paper presents a comprehensive economic analysis for distributed photovoltaics (PV) paired with battery energy storage systems (BESS) for three new DR programs, including fast frequency response, capacity grid service, and regulation reserve. Optimal dispatch and sizing methods are developed for the paired system considering different tariff schedules and PV compensation programs across five islands. It was found that while the best resource configuration and potential economic benefits vary with tariff structure, integrating BESS with PV can be optimally dispatched to generate multiple value streams simultaneously. Compensation from DR programs is an important value stream to help increase the cost-effectiveness of the integrated system.

Revised: February 15, 2021 | Published: March 15, 2021

Citation

Wu D., X. Ma, P.J. Balducci, and D. Bhatnagar. 2021. "An economic assessment of behind-the-meter photovoltaics paired with batteries on the Hawaiian Islands." Applied Energy 286. PNNL-SA-156151. doi:10.1016/j.apenergy.2021.116550