Economic analysis of wind plant and battery storage operation using supply chain management techniques

Wind energy is the fastest growing energy source in the world. However, due to the inherent issues of intermittency and remoteness the need to complement wind energy with storage is well-recognized. Pumped Hydro Electric Storage units are the established and most widely studied application. Other technologies like flow (ZnBr) and NaS batteries are emerging but are still not considered economically viable. We assess the profitability of a wind plant plus battery storage system from a supply chain perspective. This includes network design decisions (like facility location, market allocation, supply allocation and capacity allocation) and daily operating policies (to manage the inventory of stored energy). We use a Monte-Carlo simulation model that creates realistic conditions for wind plant output, market prices, storage costs and technical characteristics to calculate profits. Our results show significant improvement in profits for certain decisions and also provide target costs and payback period for storage technologies.