Financial and economic modeling of large-scale gravity energy storage system

• Published in: Renewable energy 2022-06, Vol.192, p.405-419
• Main Author: Berrada, Asmae
• Format: Article
• Language: English
• Subjects: Economics; Energy storage; Financial modeling; Gravity energy storage; Large-scale ES; LCOS
• ISSN: 0960-1481; 1879-0682
• DOI: 10.1016/j.renene.2022.04.086

The power system faces significant issues as a result of large-scale deployment of variable renewable energy. Power operator have to instantaneously balance the fluctuating energy demand with the volatile energy generation. One technical option for balancing this energy demand supply is the use of energy storage system. Financial and economic assessment of innovative energy storage systems is important as these technologies are still in their early stages of development with various opportunities and uncertainties including technological and financial risks. This work models and assesses the financial performance of a novel energy storage system known as gravity energy storage. It also compares its performance with alternative energy storage systems used in large-scale application such as PHES, CAES, NAS, and Li-ion batteries. The results reveal that GES has resulted in good performance metrics including IRR and NPV of project and Equity, as well as ADSCR, and LLCR. In addition, for a 1 GW power capacity and 125 MWh energy capacity system, gravity energy storage has an attractive LCOS of 202 $/MWh. The LCOS comparison has shown that GES system is a cost-effective technology as compared to its counterparts. From a financial and an economic perspective, the studied energy storage systems are feasible technologies to store large scales energy capacities because they generate sufficient returns for project investors, have a high ability to service debt payments from cash flows, and, most importantly, achieves sufficient financial performance.