What a battery saves the system and what it earns are evaluated separately

A storage configuration may benefit the system and be unfinanceable under current remuneration, or be financeable and provide little benefit.

System benefit is the net reduction in the system’s operating and unserved-energy costs against an explicit counterfactual. Capturable revenue is what the investor receives for energy, capacity, services, and contracts. The economic evaluation determines whether the configuration benefits the system; the financial evaluation, whether it meets the required return. Each cost is counted once.

For a hypothetical 4-hour battery in northern Chile, public data allow the financial evaluation to begin. System benefit remains unquantified: the system must be simulated with and without the battery, against a defined alternative.

With a Capital Projects Decision System, the 3 quantities — benefit, revenue, and cost — come from the same system simulation and are assessed together.

Does your committee evaluate separately what the configuration saves the system and what it earns?

The full Perspective, with its sources, is available on request.