1. Energy storage optimization A techno-economic analysis of battery chemistries in hybrid microgrids
October 27, 2015
Rebecca Ciez*, Jay Whitacre*†
*Engineering & Public Policy, †Materials Science & Engineering

2. Energy storage significant in microgrids
Significant component for both functionality and cost
How do the inherent characteristics of different storage technologies influence the overall cost of electricity from hybrid systems?
Which technologies are the most cost-effective, and what economic conditions are necessary for mass adoption?
Maximize utilization
Account for degradation
Diesel
Generator
Solar PV
Energy Storage
Off-Grid Community
(lighting, small electronics)1

3. Variety of factors influence storage performance
State of Charge (SOC swing)
Temperature
Operational timeframe
Chemistry
Cost per kWh
Cycle life
Sensitivity to SoC Swing
Details
Lead-Acid
$200
($150-$250)
Poor
(~500)
High
Most commonly used battery in hybrid microgrid systems
High Power
Density Li-ion
(A123 Systems, LiFePO4)
$680
($530-$1000)
Excellent
(~10,000)
Low
High cost, high power density
High Energy Density Li-Ion
(Panasonic, LiNiCoAlO2)
$250
($200-$300)
Average
(~5,000)
Medium
Low cost, high energy density

4. Battery cycles depend on SOC swing
Existing data for lead acid [Pesaran & Markel, 2007] and High power density li-ion [Peterson et al 2010]
Cycle testing for high energy density li-ion
Thanks to W. Wu for SEM images

5. Operational Model Overview
Operational Parameters
Battery technology
Renewable energy requirements
Maximum SOC swing
Operational lifetime
(1, 2, 5, 10, 20 years)
Load
Solar PV
Operational Model
Diesel Generator
Actual Cycling Behavior
Storage Requirement
Minimize diesel electricity generation, with the minimum energy storage required to meet specified targets on percentage of renewable energy generation
Battery Storage
Power Mix

6. Storage capacity required

7. Trends in storage capacity
Short timeframe:
Falling storage requirement as max SOC swing increases
Inflection point:
Deep cycling degradation occurs
Add capacity to extend lifetime
Very long timeframe:
Max. SOC swing reached decreases
Load constant, packs much larger
Never approach specified limit SOC swing
Deets on cycling frequency:
Avg day: 20.5 kWh of energy consumed
60% max. SOC swing allowed
1 year: pack is 19kWh
5 year: 61 kWh
20 year: 268 kWh

8. Economic Model Overview
Cost Assumptions
Replacement Assumptions
Economic Parameters
Fixed 20 year timeframe
Number of battery replacements (every
1, 2, 5, 10, 20 years)
Cost Assumptions
Discount Rate
Load
Solar PV
Operational Model
Economic Model
Diesel Generator
Actual Cycling Behavior
LCOE
Storage Requirement
Battery Storage
Power Mix

9. Levelized cost of electricity tracks with storage capacity

10. More replacements offer lower costs for higher SOC swings

11. Comparing between technologies
Previous graphs show variation in:
Battery chemistry
Maximum SOC swing
Cost assumptions
Number of replacements
Fixed: discount rate and renewable energy requirement
Previous graphs show differences in battery chemistry, allowed SOC swing, pack replacements, varying cost assumptions, but held the discount rate and % of renewable energy fixed
5% discount rate
75% min. renewable
energy requirement
High energy density
li-ion slightly cheaper than lead acid

12. What about other model parameters?
Discount rate matters:
Low discount rate: lead acid best
Higher rates, high energy density li-ion
High power li-ion always most expensive
Renewable energy requirement:
Most optimal combinations exceed the minimum target
Max change was 4¢/kWh
Renewable requirement: large packs generally exceed the renewable energy requirement (minimal change in storage capacity for higher % of renewable)

13. Price changes required increase with discount rate
Diesel prices required to induce a switch track with discount rate
Larger percentage price decreases on batteries for higher discount rates
High power li-ion still most expensive in absolute terms

14. Policy interventions track with discount rate
Carbon taxes would need to be much higher
Typically $10-30/ton
Highest: $168/ton (Sweden)5
Feed-in tariffs comparable to current rates at low discount rates4

15. Conclusions
Optimal number of battery replacements dependent on how deeply batteries are cycled
At assumed prices, diesel is still less expensive than hybrid systems
High performance of high-power li-ion doesn’t offset high capital cost
Discount rate is a significant factor in determining the lowest-cost storage option
Low discount rates: Lead-acid best
High discount rates: high energy density li-ion best
Diesel price changes and policy interventions required to induce a switch to hybrid system track with discount rate
Larger battery price changes required as discount rate increases

16. Acknowledgements
Thanks to Inês Azevedo for her thoughtful comments and discussions, and to Wei Wu for his assistance with battery cycle testing & SEM imaging.
This research was supported by:
National Science Foundation GRFP
Carnegie Mellon University
Bushnell Fellowship in Engineering
Aquion Energy
This material is based upon work supported by the National Science Foundation Graduate Research Fellowship under Grant No. DGE Any opinion, findings, and conclusions or recommendations expressed in this material are those of the author(s) and do not necessarily reflect the views of the National Science Foundation.

17. Rebecca Ciez rciez@andrew.cmu.edu
Questions?
Rebecca Ciez

18. References
[1] E.M. Nfah, J.M. Ngundam, M. Vandenbergh, J. Schmid, Simulation of off-grid generation options for remote villages in Cameroon, Renewable Energy. 33 (2008) 1064–1072. doi: /j.renene [2] Pesaran, A. & Markel, T., Battery Requirements and Cost-Benefit Analysis for Plug-In Hybrid Vehicles (Presentation), (2007) 1–22. [3] S.B. Peterson, J. Apt, J.F. Whitacre, Lithium-ion battery cell degradation resulting from realistic vehicle and vehicle-to-grid utilization, Journal of Power Sources. 195 (2010) 2385–2392. doi: /j.jpowsour [4] Feed-in Tariffs and similar programs, US Energy Information Administration. (2013) [accessed ]. [5] The World Bank, Putting a Price on Carbon with a Tax, 1–4, [accessed ].

19. Storage Requirements Converge for different renewable energy requirements in the long-term

20. Frequency of Pack SOC swing as operating time increases

21. Model Specification

22. Discount rate has limited impact on diesel generation costs
Value future electricity production less
Capital costs play a small role in LCOE of diesel-only generation
Discount both electricity produced & variable costs (fuel)

23. Model Overview Operational Parameters Economic Parameters
Cost Assumptions
Replacement Assumptions
Operational Parameters
Battery technology
Renewable energy requirements
Maximum SOC swing
Operational lifetime
(1, 5, 10, 20 years)
Economic Parameters
Fixed 20 year timeframe
Number of battery replacements (every 1, 2, 5, 10 years)
Cost Assumptions
Discount Rate
Load
Solar PV
Operational Model
Economic Model
Diesel Generator
Cycling Behavior
LCOE
Storage Requirement
Battery Storage
Power Mix