Revenues of Pumped-Storage from Energy and Reserves Markets

This paper studies the revenues of pumped-storage doing price arbitrage on the day-ahead market (DAM) and providing frequency containment reserves (FCRs). To derive the DAM revenues, a perfectly forecasting price-taker framework is considered along with historic Belgian DAM prices. Based on a simple linear programming formulation, yearly revenues per megawatt of storage are derived in function of both the cycle efficiency and the number storage hours. It is then considered that the pumped-storage unit is operated at variable speed, and thus able to provide FCRs. Based on realistic operation ranges of such a unit, DAM implications of the FCRs provision are discussed, revenues are estimated and compared to those obtained in the case of DAM arbitrage only