Compressed Air Energy Storage in Denmark:a feasibility study and an overall energy system analysis

Compressed air energy storage system (CAES) is a technology which can be used for integrating more fluctuating renewable energy sources into the electricity supply system. On a utility scale, CAES has a high feasibility potential compared to other storage technologies. Here, the technology is analysed with regard to the Danish energy system. In Denmark, wind power supplies 20% of the electricity demand and 50% is produced by combined heat and power (CHP). The operation of CAES requires high electricity price volatility. However, in the Nordic region, large hydro capacities have so far kept the prices from fluctuating to the extent that CAES investments have not been considered feasible. This report studies the effect of technological development and possible future price development of investments in CAES plants of various capacities. It is found that advanced high-efficiency CAES plants are likely to become feasible in the near future