A Control Strategy for Peak Shaving and Frequency Regulation Considering Battery Degradation Under Time of Use Pricing

Because batteries (Energy Storage Systems) have better ramping characteristics than traditional generators, their participation in peak consumption reduction and frequency regulation can facilitate load and generation balancing by injection or withdrawal of active power from the electrical grid. In this paper, we propose a joint optimization framework for peak shaving and frequency regulation under a Time of Use pricing, taking into account battery degradation, to increase the economic benefits in the Microgrid. The paper evaluates the proposed approach using a fast regulation signal from a standard Energy market. The simulation results show that the cost reduction in the case of our joint optimization is doubled (11%) compared to each individual application (around 6%).