Design of an Optimal Investment Model for a Hybrid Energy Park
This thesis investigates the profitability of building a solar park and battery storage at SR Energy's wind park Örbacken in SE3 and develops an optimal investment model in Excel and Python. Solar park production is calculated in Excel and sent, together with other input, to a Python program that optimizes the electricity flow each hour to maximize revenue over one year. The optimization considers the calendar and cycle aging of the battery. NPV with a discount rate of 5.5% is used to analyze profitability, together with inflation, yearly aging, and reduced revenue from wind. Three sensitivity analyses are carried out on the battery aging cost, revenue, and investment cost.
The results indicate that a solar park is profitable in 2023 but not in 2024, and that battery revenue from energy arbitrage is not sufficient to make battery storage profitable. When the battery cycles were increased by removing the cost of aging, a solar park with larger battery storage was most profitable in 2023, while this was not enough to make any combination profitable in 2024. Doubled battery revenue, representing other revenue streams such as ancillary services, leads to profitability in both 2023 and 2024 for a small battery of size 1-4 MWh. Profitability decreases notably when battery investment cost is doubled, indicating that this has a large effect on profitability.
Solar PV is projected to double in SE3 between 2025 and 2029, while Germany has ambitious plans for solar expansion. This is likely to reduce the future profitability of solar power. Battery capacity for energy arbitrage is expected to increase by 50% in the same time period, highlighting the importance of other revenue streams. Reduced costs of solar PV and battery storage in the future and from building next to a wind park could render hybrid parks more profitable. This is not investigated in detail in this thesis, and it is recommended that future work examine this and other financial aspects for a more comprehensive economic evaluation.