CAES is able to improve the
value and efficiency of generation and transmission assets.
During periods of low demand or uneconomic off-peak markets, many generators
are forced to ramp down, resulting in higher operations and maintenance
costs, suboptimal heat rates, and the start-up risks associated with shutting
down machinery daily. CAES enables existing assets to increase their capacity
factor and efficiency by storing the off-peak power for on-peak sales.
CAES can improve on-peak system efficiency as well. Because CAES can operate
very efficiently even at a 50% load factor, the CAES plant can be used
to absorb increases and decreases in system demand that would otherwise
cause system assets to operate outside their optimal performance range.
Faced with demand that would normally require additional assets to come
on-line at a low capacity factor, a system operator can utilize the CAES
plant until demand increases enough to bring on the additional generation
at efficient operating levels.
The value of renewable power generation capacity can also be improved
with a CAES plant. Many types of renewable energy, such as wind and solar,
are intermittent sources of generation - they only produce when the wind
blows or the sun shines. The price that can be received for this type
of power is highly discounted due to its non-firm nature. In addition,
wind power is often produced in off-peak periods when power is less valuable.
By storing energy from renewable sources and delivering it to the grid
as a firm, ratable product with shape characteristics that match levels
of peak demand, CAES can increase the price received for renewable power.
A CAES plant can shift the flow of power to times of low demand and debottleneck
existing transmission constraints. This enables additional power to flow
without requiring costly and time-consuming system upgrades.
CAES increases the efficiency of capital in the highly capital intensive
power industry. Because CAES improves system capacity utilization rates,
it reduces the need for additional power production and transmission capacity
and frees up investment dollars for use in other activities.
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