Alternate Revenue Stream Analysis for a Residential Battery Connected to a PV Rooftop

Open Access
Mesiwala, Akil
Graduate Program:
Energy and Mineral Engineering
Master of Science
Document Type:
Master Thesis
Date of Defense:
July 16, 2014
Committee Members:
  • Seth Adam Blumsack, Thesis Advisor/Co-Advisor
  • Dr David Riley, Thesis Advisor/Co-Advisor
  • lithium ion
  • battery
  • solar PV
  • GridSTAR
  • ancillary services
  • energy arbitrage
  • regulation
  • PJM
The market for emergency backup power for residential homes in the U.S. has been increasing ever since natural disasters like hurricane Irene, Katrina and Sandy have caused widespread, long durational blackouts. Lithium ion battery storage has a great potential to capture this market, but it has a high capital cost of investment that dissuades most homeowners from investing in it. However, recent advances in lithium-ion technology as well as policy changes have opened exciting avenues for research studies into the capabilities of these batteries for services like energy arbitrage and frequency regulation. These new business cases enable batteries to be a source of revenue, while also serving its primary purpose of providing emergency backup power. A lithium ion battery is a hefty investment of anywhere between 400-1000 $/kWh of storage at current market rates. Keeping this battery idle for only backup purposes in case of an emergency is underutilizing its potential and is too high an investment for most residential homeowners. What if this battery could provide backup in case of an emergency and also simultaneously provide a steady revenue stream by participating in market services like energy arbitrage and frequency regulation? This research looks to answer that question and simulate scenarios where the battery can become a revenue-generating asset. By maximizing revenues of the battery system, this research further tries to find an alternative economic metric to quantify the cost of emergency backup power to a homeowner. The study is using a system based out of the GridSTAR residential research facility at the Navy Yard in Philadelphia.