A Numeric Study of the Impacts of Energy Storage Cost on the Energy and Capacity Markets’ Revenue

This paper investigates the integration and impact of energy storage systems (ESS) on energy and capacity markets. With the rapid integration of renewable energy sources (RES), the intermittent nature of RES necessitates robust energy storage solutions to ensure grid stability and reliability. This study leverages a market model that combines energy and capacity clearing, factoring in the influence of ESS. Our findings highlight the critical role of ESS in shifting energy costs and demand profiles, thus influencing market clearing prices across both markets. By simulating various scenarios of energy storage costs, this paper quantifies the impact on market outcomes.