Application of energy storage in systems with high penetration of intermittent renewables

Nowadays, in Uruguay, a considerable amount of energy produced by renewable resources is curtailed inducing frequent substantial reductions in the spot market prices. This paper analyses the incorporation of energy storage into the Uruguayan network, taking the different perspectives of a private investor and a central planner. From the investor point of view, we investigate the option of doing energy arbitrage in the wholesale market, taking advantage of the spot price fluctuations. From the national perspective, we develop an optimal power flow planning model to perform a cost-benefit analysis of batteries’ integration in reducing thermal generation. We conclude that, from a private investor perspective, fluctuations in the spot prices are not enough to make investments in batteries profitable with current prices. On the other hand, from a national perspective, results are more promising, obtaining very high revenues in some case studies.