EnergyEcoLab’s Publications on Energy Storage

We are pleased to report that our team’s work on energy storage is forthcoming in two recent publications at the Rand Journal of Economics and The Energy Journal.
The development and integration of large-scale energy storage facilities is a key factor for the expansion of renewable energy in the portfolio mix of the electricity generation. Our research will contribute to a better understanding on the effect of energy storage on market outcomes as well as on the incentives of storage owners to invest and operate storage facilities.

In “Storing Power: Market Structure Matters”, forthcoming at the Rand Journal of Economics, David Andrés-Cerezo and Natalia Fabra assess firms’ incentives to operate and invest in electricity storage facilities under different market structures, including competitive and strategic storage owners in the cases in which the storage owner is integrated with a dominant electricity producer or it is a stand-alone firm. Their results are key to understanding how to regulate electricity storage, an issue which is critical for the deployment of renewables in electricity markets.

Paper available here.

In “Large-scale Battery Storage, Short-term Market Outcomes, and Arbitrage” published at Energy Economics, Stefan Lamp and Mario Samano document document charging and discharging patterns in the Californian electricity market and show how the utility-scale batteries’ activity correlates with load and real-time prices during 2018 and 2019. The empirical findings are partially consistent with the optimal solution of an arbitrage maximizer, indicating that battery owners respond to price incentives only at certain hours of the day. In addition, they provide evidence that battery deployment in the years 2013 through 2017 lowered average intra-day wholesale price spreads and that current market conditions limit the profitability of batteries in this market.

Paper available here.