THE VIRTUAL BATTERY
By Anders Dyrelund, Senior Market Manager, Ramboll
John Flørning, Lead Consultant, Ramboll
Søren Møller Thomsen, Energy Engineer, Ramboll
The million-dollar question is not whether we can build enough renewables but how to use the renewable energy pro- duced cost-effectively. This article will discuss how the fluctu- ating renewable energy from wind and solar can be used for heating and cooling buildings. It will be very expensive or even impossible if we only look at the electricity system and individual buildings. The answer will likely be that we need huge electric battery capacities. But it will be very expensive and inefficient, seen from a societal per- spective. Looking at the whole energy system, we can do it cheaper and more efficiently due to the economy of scale and sector cou- plings. The answer is that modern hot water district heating systems are crucial to utilizing fluctuating renewable energy in a smart, cost-effective way. In fact, the district heating system acts as if it was a battery – for almost a decade, we have called it the virtual battery. Some have argued that the “battery” is not 100% CO2 neutral, as the renewable electricity stored in the “battery” does not return to the grid. True, but not important, as the impact on the power system is the same. Soon, we see new sector couplings in the pipeline, namely Carbon Capture and Utilization, CCU, and electrolysis, which close the circle. But how do we get started? We can describe the development of the virtual battery in steps in line with the development from the 1st to the 4th gen- eration of district heating and district cooling.
What is the secret of the town? Do they have a magnificent electric battery? No, they have a typical Danish district heat- ing system, which has supplemented the existing 40th MW gas fueled CHP plant and the thermal storage tank with an 80 MWth electric boiler and a 40 MWth electric heat pump. As we can see, this smart integrated system acts like a battery – there- fore we have called it a virtual battery. Some have argued that it is not 100% CO2 neutral. True, but it is not of importance for the cost effective decarbonization. Moreover, within 10 years we can foresee that the gas from the Danish gas grid will be 100 % biomethane and that electro fuels can substitute the fossil fuels in boilers offering vital resilient back-up capacity for wind, solar and gas in the European gas grid. How do we decarbonize the energy sector? The simple answer is: “we establish solar PV and wind tur- bines” and “buy green electricity.” But the ordinary electricity consumption cannot be adjusted to the fluctuations of wind and solar production. In periods with low wind and solar, the electricity consumption will be covered by hydropower or thermal power stations. Furthermore, the electricity market operates by the marginal pricing principle, meaning that it is always the most expensive marginal unit setting the electric- ity price. In case of high prices, the most expensive plant will likely be an inefficient natural gas-fueled condensing power plant. And in the case of zero or even negative prices, it is likely that wind or solar energy is curtailed, as it functions as the marginal unit.
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