Energy arbitrage with grid-scale batteries involves charging the batteries by buying electricity when prices are low—typically during off-peak hours when demand and emissions may be lower—and discharging or selling electricity back to the grid when prices are high, usually during peak demand periods. This practice leverages price differences in electricity markets to maximize profits by optimizing when batteries store and release energy.
Impact on Emissions
The emissions impact of energy arbitrage using grid-scale batteries depends largely on the carbon intensity of the electricity consumed during charging and the emissions avoided by displacing other generation during discharging:
- Charging during low-demand periods: When batteries charge during off-peak hours, the electricity mix may have a higher share of renewables or more efficient generation, potentially resulting in lower emissions per unit of electricity stored. However, if charging electricity comes from fossil-fuel-heavy generation, emissions associated with stored energy increase.
- Discharging during peak demand: Grid-scale batteries discharge electricity during peak demand when electricity prices are high and usually when fossil fuel plants, often with higher emissions, ramp up generation to meet demand. By discharging stored energy during these times, batteries can reduce the need for this fossil generation, thus lowering overall emissions of the system.
- Enabling renewables integration: Batteries performing arbitrage can store excess renewable energy when supply is high but demand is low, preventing curtailment of clean energy, and then supply that clean energy during peak demand. This flexibility supports greater renewable penetration and reduces reliance on fossil fuels.
- Losses and efficiency considerations: Energy storage systems incur some energy losses during charge/discharge cycles. These losses mean more energy must be generated upstream to compensate, which can increase emissions if that extra generation is fossil-based. However, if the arbitrage cycle reduces fossil fuel use at peak times sufficiently, net emissions can still decline.
Summary
Energy arbitrage by grid-scale batteries generally leads to emissions reductions by shifting energy use away from high-emission peak generation to times when cleaner energy dominates or demand is lower. It supports grid flexibility and renewable energy integration, helping to lower the overall carbon footprint of electricity systems. However, the exact emissions impact depends on the electricity generation mix at both charging and discharging times and the efficiency of the battery system itself. The strategy maximizes economic value while often contributing to emissions mitigation in the power sector.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-does-energy-arbitrage-impact-the-emissions-of-grid-scale-batteries/
