Regulatory analysis and economic challenges to enable new energy storage systems in power systems

This paper presents a methodology for analyzing the feasibility of the insertion of energy storage systems in electric distribution networks due to different regulatory policies. Various topologies are used as input data, and as output, we have the maximum possible cost that the energy storage system may have to be considered viable by the potential investor. With the input data is possible any combination of these 8 regulatory policies, generating 255 scenarios for evaluation. For each scenario, the possible revenue was estimated, with each one scenario generating 441 sub-scenarios resulting from the test of several levels of WACC and taxes. Thus, in all, there are 112,455 possible regulatory configurations for evaluation. Based on the calculation of cash flow in each sub-scenario, the work determined the maximum possible cost in each of these. The proposed method allows the validation of which energy storage technologies are feasible or not, and which technological development they need to achieve considering the regulatory framework in which they are inserted. Through simulations with standard distribution networks using worldwide economical reference values, it is possible to determine which changes regulatory agents must make to enable the rise of storage systems in power distribution networks.