Optimal sizing of residential battery systems with multi-year dynamics and a novel rainflow-based model of storage degradation: An extensive Italian case study

Residential battery storage to perform load shifting and demand side management has become of utmost importance to improve hosting capacity, increase renewable energy penetration and meet environmental targets, especially with energy community policies. As the lifetime of electrochemical batteries depends upon their scheduling and environmental conditions, the multi-year effects of operational strategies can affect the economics of the investment. However, rarely complete long-term simulations of the operation of storage systems are performed to assess the battery profitability including the operational effects of aging, and limited studies account for a large statistics of consumers. In this study, we propose a multi-year sizing methodology for residential applications, where the complete lifetime of batteries is simulated at 15-min time resolution till complete degradation using an improved non-linear non-convex degradation model; the photovoltaic plant aging is also considered. An extensive analysis on the economics and commercial size best suited for 399 real load profiles in Italy is proposed. Results suggest that the break-even price of the storage is about 400 €/kWh, which is lower than the average commercial price, and that, as reviewed, current market components may be unfit for consumers with low energy demand. Net Present Value (NPV) and Discounted PayBack Time (DPBT) can reach 500-1500 € and 8-11 years