How encoord helped Sumitomo SHI FW assess the practicality of integrating their Liquid Air Energy Storage technology in Europe, as well as determining its influence on reducing greenhouse gas emissions.
Espoo, Finland
Sumitomo SHI FW had key questions around:
How can we validate the value of Liquid Air Energy Storage (LAES) technology?
How do we tell the value story of LAES to the energy industry?
How do we identify operation, utilization, and revenues for LAES in systems that are rapidly integrating renewable energy?
How can we quantify the system-level effects of LAES in electricity markets like Germany and Spain?
Using the software SAInt and our team of expert modelers and planners, encoord was able to provide answers to these questions utilizing:
Electricity market optimization models.
A detailed dataset of the European electricity market.
Sensitivity of the results to exogenous factors like RES penetration, regulatory changes (i.e., introduction of storage in ancillary services), and CO2 emission prices.
Evaluation of different LAES configurations.
The results show a promising outlook for Sumitomo SHI FW's LAES technology.
Governments and organizations now have quantifiable evidence to show the benefits of this technology.
LAES technology is a tool that will help move the world toward ambitious renewable energy integration and decarbonization goals.
With the European Union’s ambitious climate policies focused on a 55% reduction in greenhouse gas emissions by 2030, the need has increased for large-scale renewable energy sources and feasible methods to store them for long durations. One company looking to help shift renewable energy in this direction is Sumitomo SHI FW (SFW) with its Liquid Air Energy Storage (LAES) technology.
LAES uses long-duration, thermo-mechanical energy storage in the form of liquid air at ultracold temperatures. Newly generated and excess renewable energy is used to compress and pressurize ambient air into a liquified state, which is then stored in insulated tanks for up to two weeks. The liquified air is evaporated and pushed through a multi-stage turbine that rotates and generates electricity that is introduced into the energy grid.
To properly quantify and understand the value that SFW’s LAES technology can bring to the European power system, encoord used its software SAInt and a comprehensive model of the European electricity market to:
Run comprehensive production cost models (PCM) of the European electricity market
Analyze several scenarios based on variable parameters, both conservative and optimistic, including:
Penetration of renewable energy sources over time from reference (2021) to very high (2040)
Candidate configurations of the LAES fleet
Reserve requirements in the German and Spanish ancillary service markets
Ability of LAES to contribute to reserve provisions
Price of CO2 emissions
Analyze the effects of LAES integration in Germany and Spain compared to a baseline without LAES
encoord was able to demonstrate to SFW that LAES systems have a promising role in the European electricity market, especially in high-renewables scenarios. The results indicate that LAES can firm renewable power generation, reduce curtailments, and drastically lower marginal generation costs. Furthermore, LAES's long-duration capabilities make it suitable for providing capacity reserves and other grid services.
This study gives Sumitomo SHI FW quantifiable evidence that their LAES system can aid in the European Union’s efforts to achieve its ambitious greenhouse gas emission reduction goals.
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