Enhancing the viability and bankability of hybrid RES-BESS systems with corporate power purchase agreements and electricity market participation

Renewable Energy Sources (RES) play a significant role in the green energy transition. Recently, state support for RES has been declining or even abandoned. In this context, corporate Power Purchase Agreements (PPAs) represent an alternative financial instrument for new RES installations. PPAs can mitigate investment risks and the active participation in different market segments, which is achievable considering the co-location of Battery Energy Storage Systems (BESS). A hybrid scheme of a corporate PPA for a co-located Photovoltaic (PV) and BESS asset is examined in this paper under a semi-contracted and semi-merchant scheme aiming at ensuring bankability for the asset and profit maximization through market participation. A probabilistic neural network is developed to determine a secure Pay as Delivered PPA delivery profile, and a Mixed Integer Linear Programming model is developed for the optimal sizing, scheduling, and dispatch of stored energy to different electricity market segments. The Greek electricity market is selected for the investigation of the proposed methodology, being a market with a high share of PV. The findings suggest that higher capital expenditures reduce optimal BESS capacity, while lower offer greater flexibility in BESS size. As the amount of delivered power under the PPA increases, the RES investor, as active market participant, must schedule the asset up to several days if grid charging is not possible.