Influencing the bulk power system reserve by dispatching power distribution networks using local energy storage

Multiple research works and power systems operational practices have qualitatively associated the progressive connection of stochastic renewable energy resources with the increase of power systems reserve requirements. At the same time, the price and technology of MW-class Battery Energy Storage Systems (BESSs) have considerably improved, which opens up the possibility to make electric distribution networks dispatchable. In this paper, we investigate the impact on the bulk power system of dispatchable electric distribution networks that host a large share of stochastic resources. The essential questions inspiring this research are: (1) Assuming that BESSs are deployed to achieve dispatchability of distribution grids embedding stochastic resources, what is the impact on the bulk power system reserve requirement? (2) Is this large-scale integration of BESSs economically viable compared to centralized reserve procurement from traditional power plants? To address these questions, we consider the case of the Danish transmission grid and the associated fleet of conventional power plants and compare it against locally dispatched distribution grids. We perform stochastic simulations to quantify and validate the amount of reserve necessary to operate these power systems with a desired reliability level. We establish a numerical equivalence between saved conventional reserve capacity and amount of BESS storage deployed in distribution networks. Then, we quantify the economic pay-back times of BESSs capital expenditure (CAPEX). The results show that: (1) large scale deployment of BESSs with dispatchable distribution networks is a viable technical solution to address flexibility requirements for the bulk power system and (2) this solution is economically viable with a pay-back time in the range of 11-14 years compared to providing flexibilities from conventional power plants.