An assessment of large scale battery energy storage for industrial loads

Reduction of peak demand on utility systems can be beneficial to both utilities and customers. One means of achieving peak demand reduction is by the use of load-leveling batteries. This thesis describes the technical and economic factors for demand side, customer-owned battery energy storage systems. The thesis has taken into account battery costs, converter and balance of plant costs, current utility rates, and customer load profiles typical of those for which battery storage may be feasible. Battery storage system designs and costs were described and quantified by using the results of EPRI project 1275-12. Utilities in the midwest were selected and contacted to obtain the most current rates and customer load profiles. Using the data for a range of applications, an economic analysis was conducted. A base application was described and evaluated using after tax internal rate of return and net present worth methods. Cost and performance parameters were varied parametrically in order to determine the sensitivity of the parameters. An analysis of 23 specific customer applications was also made. Results of this thesis indicate that the battery, converter and balance of plant technology make construction of customer-owned battery energy storage systems technically feasible. However, economic feasibility was found for only a few applications. Major equipment costs were found to be battery and converter costs. Battery system size and balance of plant costs also have an effect on the economic feasibility. Other cost and battery system design factors, including maintenance costs and battery efficiency, were found to have little influence on the net present worth. The non-equipment factors found to be important included the utility demand charge and the shape of the customer load profile --Abstract, pages ii-iii