Electricity spot price-controlled battery in a multifamily residential building

Abstract

In recent years, the rising cost of electricity has prompted growing interest in solar photovoltaic (PV) and batteries. Understanding the interaction between electricity demand, battery control strategies, and electricity production from solar PV is crucial for designing coupled systems. This thesis examines the economic potential of integrating an electricity spot price-controlled battery in a multifamily residential building in Förlanda, Kungsbacka. Various control strategies are explored using IDA ICE software for simulations, focusing on utilizing the battery to exploit lower electricity prices through arbitrage. Additionally, the nine simulation cases are economically assessed from the perspectives of both a facility company and a private homeowner. The results for the facility company cost perspective indicated that, based on 2023 spot prices, a standalone battery increased annual costs by 6 300 SEK, while coupling the battery with a solar PV system increased costs by 500 to 2 400 SEK, depending on the battery control strategy. However, a standalone solar PV system decreased annual costs by 2 900 SEK, based on the equivalent annual cost (EAC) method. This suggests that batteries for arbitrage, in buildings of similar size and energy performance as the reference building, are not profitable for facility companies. For private homeowners eligible for subsidies, a battery could be economically viable if coupled with a solar PV system. However, even here, the annual savings from a standalone solar PV system decreased from 4 900 SEK to 3 400 SEK when coupled with a battery. Likewise, a battery without solar PV increased annual costs by 1 800 to 2 600 SEK. Thus, the solar PV system alone was the economically recommended investment for both cost perspectives. Furthermore, two sensitivity analyses were conducted: one to assess the economic implications of using different historical spot prices (2020 – 2023) in simulations, and the other to explore the inclusion of minimum arbitrage criteria for battery utilization to enhance profitability. The results indicated that different yearly spot prices could significantly alter the economic outcome and that battery control strategies benefited from restraining battery utilization during days with low price spread.