Cost targets to achieve commercially viable thermal storage in buildings
To mitigate the variation in demand on the electric grid, thermal energy storage (TES) is an alternative to electric batteries or installing new peaking power plants. Stakeholders and policy makers across the United States have expressed interests in promoting TES, as demonstrated by the US Department of Energy’s Grid-Interactive Efficient Buildings program and the efforts of various state legislatures. However, the cost value provided by TES are unclear. If reliable cost benefits were determined, stakeholders would have a clearer picture of the financial returns that can be gained from their investment in TES. In this report, EnergyPlus was used to perform whole-building simulations for two residential buildings in Indianapolis and Atlanta. The HVAC system in both buildings were equipped with phase change material TES. The TES tank was charged in off-peak hours and discharged in peak hours to perform load shifting. First, the economic value implied by existing time-of-use (TOU) rates offered by utility companies was analyzed via whole-building simulation. Second, existing demand reduction (DR) incentives sourced from 3 different electrical grid administrators (i.e., California, Texas, and New England region) were surveyed to determine their implied value. Lastly, the economic value implied by different types of deferred peak power plants were reviewed. The full value of TES to the entire society consists of value to the utility, OEMs, facility installers, and other stakeholders. This report focuses on the value to the utility with emphasis on the deferred capital of peak power plant. The value from the deferred capital of peak power plant is manifested to the customer in the form of demand reduction program and Time-of-Use utility rate program. In this report, an initial proxy of the value of TES is made by assuming the deferred capital cost of power plant is the full value to reduce peak demand. Three levels of financial value of TES systems were assessed. Two are currently available to some residential customers: (1) the benefit from TOU pricing alone and (2) the benefit from TOU pricing in combination with DR incentive programs. The third level was computed as the full cost of deferred capital cost of peaking power plants. This represents the potential value that could be gained by the utilities or conceivably be offered to consumers.