Maximizing Market Value in Solar Power Plants Using Battery Storage Systems

The more an electricity market is supplied by solar power, the lower the electricity price will be in times of high sun irradiation. For instance, in Germany prices at noon on sunny days are often close to zero. Therefore, the performance of a solar power plant should not be evaluated by its electricity output alone. In fact, the market value of electricity generation is more important since power plant operators seek to maximize their profits. Battery storage can increase the market value by unbundling the timing of generation from the timing of sales. The success of this strategy mainly depends on three variables: the cost of the solar power plant, the cost of the battery system, and the electricity market conditions, particularly price levels and volatility. These variables are highly dynamic in the context of energy transition. In this paper, we simulate a realistic solar power plant in Mainz using PVsyst program with adjustable plant capacity. We then develop an algorithm to increase the market value of solar electricity using battery storage. Based on mentioned variables, we calculate the optimal ratio of solar generation to battery capacity, enabling operators to select the most suitable configuration respective market conditions.