Open AccessSTOCHASTIC ENERGY DEMAND AND THE STABILIZATION VALUE OF ENERGY STORAGE
Author(s) -
Tsur Yacov,
Zemel Amos
Publication year - 1992
Publication title -
natural resource modeling
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.28
H-Index - 32
eISSN - 1939-7445
pISSN - 0890-8575
DOI - 10.1111/j.1939-7445.1992.tb00288.x
Subject(s) - energy storage , value (mathematics) , production (economics) , peak demand , electricity , environmental economics , microeconomics , economics , energy (signal processing) , power (physics) , computer science , mathematics , statistics , engineering , electrical engineering , thermodynamics , physics , machine learning
The economic value of energy storage to meet peak electricity demand is analyzed with an emphasis on the role of demand uncertainty. The concept of the stabilization value, which measures that part of the benefit of the storage project which is due solely to the stochastic demand components, is defined. The magnitude of the stabilization value, relative to the overall value of energy storage, is evaluated in terms of a simple model that accounts for the relevant characteristics of the electric power utility's production mix. It is found that neglecting the demand uncertainty can seriously bias the benefit assessment of the storage project as well as the determination of the optimal storage capacity.