Flexible storage operation in a market environment

Future power systems with high penetrations of variable renewables will require increased levels of flexibility from generation and demand-side sources in order to maintain secure and stable operations. One potential source of increased flexibility is large-scale energy storage, which can provide a variety of ancillary services across multiple timescales. In order for adequate investment to take place, it is essential that the correct market signals are present which encourage suitable levels of flexibility, either from storage or alternative sources. This paper explores the changes required in operational practices for storage plant at different levels of installed wind capacity, and the challenges that private storage plant operators will face in generating appropriate bids in a market environment at high penetrations of variable renewables. The impacts on system generating costs are explored under different operating assumptions.