Economic Assessment of Battery Energy Storage for Frequency Regulation in the Nordic Power Systems

The present work aims to determine the technical and economic implications of a Battery Energy Storage System (BESS) to participate in different Frequency Containment Reserve (FCR) markets, in accordance with the Nordic Power System requirement. For this purpose, a IMW BESS is simulated for FCR provision using frequency data from 2022. The bidding strategy takes into account the endurance and the constraints of limited energy reservoirs. Therefore, this paper proposes that the BESS will contribute to the FCR market every third hour to avoid depletion of the BESS. The economic feasibility of the BESS providing FCR is assessed through Net Present Value (NPV) and payback period analyses. The results indicate that a BESS bidding in the frequency containment reserve for disturbance for up regulation (FCR-D up) market has the shortest payback period, approximately 2 years. In contrast, BESS bidding in the Frequency Containment Reserve for Normal operation (FCR-N) market exhibits the longest payback period compared to other FCR products, totaling 7 years.