Day-ahead Economic Scheduling of Energy Storage

This article addresses the day-ahead economic optimisation of energy storage systems within the setting of electricity spot markets. The case study is about a lithium-ion battery system integrated in a low voltage distribution grid with residential customers and photovoltaic generation in the Netherlands, whereas the optimisation objective is to maximise revenues from energy arbitrage in the day-ahead auction. Assuming accurate predictions of the photovoltaic generation, the residential load and the market clearing prices, the constrained optimisation problem is formulated as the minimisation of a cost function, and is solved by utilising an internal model of the battery system to plan the future response of the charging and discharging process. Emphasis is given on the effect of the system efficiency, which significantly impacts the economic performance due to energy losses during the charging and discharging cycles.