Revenue Calculation and Analysis of Energy Storage in Charging Stations
The network of new energy vehicle charging services is becoming increasingly dense. However, charging operators and vehicle owners still face seemingly irreconcilable confrontational challenges: one side cannot make good profits, and the other side complains charging is expensive. Today, MARUIKEL will discuss with you the investment returns of energy storage in charging stations.
Energy storage in charging stations refers to the installation of energy storage systems in charging stations. This energy storage facility is like a super large powerbank. It does not store money, but full of electricity. When installed in the charging station, it is equivalent to having a smart "electricity housekeeper": When the electricity price is low at night, the " housekeeper" will quickly store the electricity. When the electricity price is high during the day, it will use the stored electricity to charge the car. In this way, the operator can earn more and the vehicle owners spend less. Both sides are happy. Isn't this a win-win situation!
However, as an operator, you have to calculate this account carefully. Before installing this "energy bank," you first need to accurately compute the required investment amount. Subsequently, it is essential to assess the potential profit from the peak-valley electricity price difference and determine how long it will take to recoup the invested funds. The pace and efficiency at which the invested money is recovered is what we refer to as the return on investment.
Therefore, operators need to both have a general picture and take a close look at the actual conditions of their charging stations. They should consider aspects like the daily number of vehicles that can be charged, the magnitude of the electricity price difference, and other relevant factors. Based on this comprehensive assessment, they can then make a well-informed decision on whether to install this "energy bank" or not. Additionally, they can determine the optimal installation scale to ensure cost-effectiveness and maximize returns.
In general, charging station storage is a good thing, but you have to calculate the account carefully and don't blindly follow the trend, so as to ensure a win-win situation.
In general, equipping charging stations with energy storage holds great promise. However, operators must conduct meticulous calculations and avoid jumping on the bandwagon. By making well-informed decisions based on a comprehensive analysis of various factors, they can ensure a win-win outcome. This approach benefits both the charging station operators, enabling them to achieve sustainable profitability, and the EV owners, who can enjoy more favorable charging costs. Such a balanced scenario contributes to the healthy development of the entire new energy vehicle charging ecosystem.
01 To Maximize Economic Benefits, It's Necessary to Calculate the "Energy Storage Accounts" of Charging Stations
From the perspective of the benefits of energy storage systems, system costs, operation and maintenance costs, peak-valley price difference, demand response benefits, etc. are all key parameters. The general formula for calculating energy storage revenue is: [peak-valley price difference/kWh*discharge amount*number of years].
Its profit-making mechanism is that during the low-load period, the energy storage battery is charged at a lower electricity price; during the high-load period, the energy storage battery supplies power to the load, achieving a smooth transfer of peak load, thus obtaining the revenue from the peak-valley electricity price difference. In simple terms, it means buying electricity from the grid at a relatively cheap price, storing it in the battery, and then selling it at a higher price.
What is the specific profit from the peak-valley electricity price difference? The calculation formula is usually [(peak electricity price-valley electricity price) * charge and discharge efficiency * number of charge and discharge times * annual operating days].
Let's continue to talk about energy storage at charging stations.
Among them, the electricity price is mainly subject to the specific policies of each country; the charge-discharge efficiency refers to the energy conversion efficiency of the energy storage system during the charging and discharging process, and this value is usually between 80%-95%; the number of charge-discharge cycles is the number of charge-discharge operations the energy storage system performs per day or per year; the annual operating days are the actual number of operating days per year.
From this, we can also see the core variables affecting the energy storage revenue of charging stations, namely the peak-valley electricity price difference and the amount of electricity that can be discharged during peak hours. The size of the peak-valley electricity price difference directly affects the revenue per kWh of energy storage, and the dischargeable electricity amount mainly depends on the operation capacity of the charging station. This also means that one of the essential conditions for energy storage in charging stations to achieve arbitrage is to have a stable amount of electricity charged during peak hours. And the amount of energy storage installed depends on how much electricity the charging station can generate during peak hours. If it can't consume electricity during high-price periods, then it's not suitable to install energy storage..
In addition to these, some places have additional subsidies and income, such as energy storage systems that help the power grid adjust the frequency and adjust the peak electricity consumption, and the government will give money or tax incentives. If the energy storage system can also participate in electricity market transactions, there may be more income.
Of course, while making money, you also have to look at the costs, such as the investment to buy and install the energy storage system, costs of operations and maintenance, etc. These must be calculated clearly to know whether it is cost-effective to equip the charging station with energy storage.
Information from the Energy Storage Industry Network revealed that, under normal circumstances, the construction cost of 1MWh of energy storage is CNY 800,000 (as of December 2023, the lowest bid price for energy storage systems is CNY 0.64/Wh, which means that the construction cost of 1MWh of energy storage is CNY 640,000, and the cost of energy storage will continue to decline in the future).
02 Making Energy Storage a Standard Feature of Charging Stations? How Can Operators Get a Share of the Trillion - Dollar Market
According to McKinsey, long-duration energy storage is expected to see large-scale growth starting from 2025. By 2030, the cumulative installed capacity of long-duration energy storage is expected to reach 150-400GW (corresponding to a storage capacity of 5-10TWh), and the cumulative investment scale will amount to US$200-500 billion.
Once there are more beneficial policies, the market will also respond positively. In the current charging service market, the explicit charging fees and service fees are just the "appetizer", merely the entrance for traffic aggregation. Even the planning and design of charging piles, EPC projects, etc. are just the "dessert", while solar energy, energy storage, solar-storage-charging integration, or micro - grids based on the charging station scenario, as well as intelligent energy operation solutions tailored to the load characteristics and energy demands of individual stations are the ultimate feast. The former is a red ocean that anyone can enter, while the latter has much higher invisible barriers.
With the accelerated penetration of new energy vehicles and the gradual liberalization of power market transactions, the energy storage system, as the "reservoir" of the power system, while helping to stabilize the power grid, is bound to provide economic benefits for the operation of charging station.
Solar EV chargers and charging stations with integrated storage and charging functions may soon become mainstream. Solar EV chargers use solar power to charge cars, which is both environmentally friendly and cost-effective. Charging stations with integrated storage and charging have both energy storage systems and charging.
