Collaborative placement and sharing of storage resources in the Smart Grid

Abstract

The development of low-cost renewable energy generators transforms households into electricity prosumers. Given that generation from renewable sources is highly volatile and does not perfectly match the daily demand pattern of households, electricity storage has been proposed for balancing energy generation and demand. In this work, we suggest that, due to the high cost of Energy Storage Systems (ESS), prosumers should deploy and share ESSs in a collaborative fashion. This will allow them to leverage the temporal diversity in their energy generation and consumption patterns, so as to reduce the cost paid to the main grid and even to cover the deployment cost of ESSs. We address the question 'How much storage capacity should be placed and in which locations in the distribution network?'. In order to answer this question, we need also to consider how much each prosumer should charge and discharge each deployed ESS. The solution of this joint ESS placement-dimensioning and utilization problem depends on the energy distribution losses, expected electricity prices, and the diversity of prosumers' profiles. Accordingly, we employ the Nash bargaining framework to determine how this cost should be shared in a fair, and hence self-enforcing, fashion among prosumers. Based on realistic demand and generation traces, we show that collaborative prosumption of energy through properly placed ESS can lead to significant savings of up to 50% compared to a non-cooperating setting. © 2014 IEEE.