Multi-timescale Market Modelling of CAES
Corre Energy is developing compressed air energy storage projects across Europe to support the drive to net-zero carbon emissions. Energy Reform carried out detailed revenue modelling of their projects capturing their role in managing the challenges of increased variable renewable in the future power system.
This project utilized Energy Reform’s state of the art Epiphron model to simulate the future operation of a Compressed Air Energy Storage Plant (CAES) in the Netherlands, Denmark and Ireland. This included simultaneous optimization across multiple market time frames. Specifically, operation in the day-head, intra-day and balancing markets was simulated simultaneously and optimized taking uncertainty into account. A comprehensive statistical characterisation of wind power forecast error was carried out allowing the evolution of uncertainty over time to be accurately modelled.
Using rolling planning with forecast error, CAES operation was optimised in a range of future years and scenarios. Detailed operations were modelled fully capturing CAES generation, compression and storage constraints and the efficiency over the full operating range of the plant was captured to a high level of detail. Detailed model outputs allowed future revenues to be estimated in the day-ahead market, intraday and balancing markets along with the value across a range of ancillary services. Additionally, future revenues of hydrogen-fueled CAES were assessed where hydrogen production via electrolysis was modeled.
Energy Reform specialises in capturing the full impacts of variable renewables in the future energy system. This study shows how appropriate modelling methodologies can demonstrate the value of flexibile technologies in the future energy system.