The energy storage system can help meet the peak demand for electricity. During peak demand, the price of electricity spikes, and power plants must ramp up production to meet the increased demand. This means that energy storage can provide greater grid flexibility. It can be purchased by distributors during off-peak hours and sold back to the grid when demand is higher.
The primary economic motivation for deploying an energy storage system is the ability to deliver power when it is most needed. This benefit accrues over the life of the system, and must be weighed against the costs of the installation. Batteries are sized according to two components: power and energy capacity. The power component determines the maximum rated electricity charge/discharge rate, and the energy component determines the total capacity of electricity produced by the battery.
The total cost of ownership (TCO) is calculated by dividing the cost of a storage system’s purchase price by the total energy delivered. In addition, the cost of charging the battery is included. When these costs are added up, the total cost of ownership of an energy storage system becomes equal to the total cost of using the system.
Total cost of ownership (TCO) is a financial estimate intended to help buyers and owners determine the direct and indirect costs of a product or service. It is a management accounting concept that can be used in full cost accounting or even ecological economics where it includes social costs.Excerpted from Wiki.
Compared to the costs of building fossil fuel-fueled power plants, energy storage makes economic sense. Additionally, storage systems reduce the peak load of the local grid network and improve the quality of power.
Electricity storage can be beneficial for the environment in several ways. For example, it can allow for the integration of renewable energy into the electricity grid. It can also help to reduce the use of inefficient generating units. It can also delay the need for additional power plants and transmission lines. However, the impact of electricity storage on the environment depends on the technology used. Batteries, for example, require raw materials and can pose environmental problems if not recycled. Additionally, some electricity is wasted during the storage process.
The carbon footprint of electricity storage operations is nontrivial compared to that of conventional electricity generation. It ranges from 104 to 407 kg of CO2 per MWh of delivered energy, depending on location and carbon intensity assumptions. However, the NOx and SO2 emissions produced by electricity storage are low compared to average generation-related emissions. The negative impact of electricity storage is not entirely negligible, but it is small enough to make it a viable alternative to powering buildings with fossil fuels.