A Financial Algorithm for Computing the Levelized Cost (US$/MWh;{EUR}/MWh) of Storing Wind Power (LCOS)

摘要

This paper discusses the financial and technical principles underlying the levelized cost (LC) method of computing the cost (US$/MWh; {EUR}/MWh) of the bulk (utility-scale) storage of wind electricity (LCOS). The paper presents a LC algorithm. The algorithm equations are presented. The algorithm uses nine recognized energy storage system (ESS) specifications (specs) to compute the levelized cost of bulk stored wind electricity. Published and developed spec values for the Eos Aurora ESS (a utility-scale [1 MW | 4 MWh] DC battery manufactured by Eos Energy Storage) and for the Cabin Creek ESS (a utility-scale [300 MW | 1,450 MWh] Pumped Storage Plant in Clear Creek County, Colorado owned by Xcel Energy) are used as case studies to demonstrate the algorithm. Other examples are provided. An addendum case study of the San Vicente (a proposed utility-scale [500 MW | 4,000 MWh] Pumped Storage Plant in San Diego County, California to be developed and owned by the San Diego County Water Authority and the City of San Diego) is also presented. For rapid computation, an Excel worksheet of the LC algorithm is presented. The goal of this paper is to present a standard computational algorithm for financial analysts to use. A financial analyst can do a LC computation based on the paper's LCOS algorithm and on the algorithm's nine ESS specs. The paper's LCOS algorithm gives the analyst who has the nine ESS spec values, a quick "bark of the envelope" verification of a developer's value for the levelized cost of bulk stored wind electricity. The algorithm is not designed to compute the cost of providing ancillary services to the grid. A different algorithm is required and is presently under development. A complication arises for the public financial analyst when using this paper's LC algorithm. The complication is that "published bulk ESS spec values" are limited. On the other hand, a financial analyst who works for an ESS developer would be able to get the nine spec values from the developer's internal documents for use in computing the LCOS for the first round internal analysis of a proposed ESS.