Optimal Battery Sizing for Demand Response and Cost Reduction
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Solution Overview
Problem
The existing battery storage systems fail to optimize daily operational costs for facilities by not effectively considering time-of-use rates, demand charges, and the benefits of demand response programs, leading to inefficiencies in electricity usage and battery degradation.
Innovation Solution
A processor-based method and system that receive power usage data, generate object function inputs, and apply them to an objective function to determine the optimal capacity for a battery storage system, minimizing daily operational costs by controlling battery usage and considering constraints like generation and demand balance, battery state-of-charge, and PV power availability.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Loss of energy
If battery storage systems are used to reduce electricity costs, then operational cost savings are achieved, but system complexity increases
Solution Approach 1:
The system optimizes battery capacity by changing the parameter of battery size to find the optimal point that minimizes operational costs while avoiding excessive complexity. The processor calculates the optimal battery capacity based on facility power usage patterns, time-of-use rates, and demand charges, implementing a data-driven approach to parameter optimization.
Solution Approach 2:
The battery management system operates autonomously using automated algorithms that process power usage data and control battery charging/discharging without manual intervention. The processor automatically determines optimal battery capacity and manages battery operations based on real-time data, reducing the need for complex human-operated control systems.
2Loss of energy
If battery capacity is increased to maximize demand response benefits, then demand charge reduction is improved, but battery degradation accelerates
Solution Approach 1:
The system implements partial action by determining the optimal battery capacity that provides sufficient demand response benefits without over-sizing the battery. The processor calculates the precise capacity needed to achieve demand charge reduction while avoiding excessive battery usage that would accelerate degradation, implementing a balanced approach that neither under nor over-utilizes the battery system.
Solution Approach 2:
The system uses feedback mechanisms by continuously monitoring power usage data, battery state-of-charge, and operational patterns to adjust battery management strategies. The processor analyzes real-time data to optimize battery discharge/charge cycles, ensuring demand response objectives are met while preserving battery life through adaptive control based on actual system performance.
3Loss of energy
If optimal battery capacity is determined through complex analysis, then cost minimization is achieved, but computational requirements increase
Solution Approach 1:
The system performs preliminary action by pre-calculating optimal battery capacity using historical power usage data and utility rate structures before actual battery deployment. The processor analyzes past consumption patterns, time-of-use rates, and demand charges in advance to determine the optimal battery size, enabling cost minimization without requiring complex real-time computational systems during operation.
Data Source
AI summary
A system and method are provided. The system includes a processor. The processor is configured to receive power related data relating to power usage of power consuming devices at a customer site from a plurality of sources. The processor is further configured to generate object function inputs from the power related data. The processor is additionally configured to apply the generated object function inputs to an objective function to determine an optimal capacity for a battery storage system powering the power consuming devices at the customer site while minimizing a daily operational power cost for the power consuming devices at the customer site. The processor is also configured to initiate an act to control use of one or more batteries of the battery storage system in accordance with the optimal capacity for the battery storage system.