BESS Methodology

A methodology to design a battery energy storage system

layout
December 16, 2024

The RatedPower team

 Abstract

Abstract

This methodology describes the process to design the layout of a battery energy storage sys-
tem in the software RatedPower. The authors of this methodology have proposed the following
structure for the document.

• The circuit arrangement that a battery energy storage system can adopt.
• The design of an AC-Coupled BESS schema and how to consider the topography require-
ments, the layout generation, the medium voltage lines and the integration of the system
in the interconnection facility.
• The design of a DC-Coupled BESS schema and how to generate an hybrid layout consid-
ering the photovoltaic plant constraints.
• The design of an Stand-alone BESS schema and how to define the site, consider the topog-
raphy requirements, the layout generation and the medium voltage lines.

Note: All the calculations that are presented in this methodology are carried out in accordance
with the latest electrical standards.

BESS Methodology 1
 Contents

Contents

Abstract 1

1 Battery energy storage system arrangements 6

1.1 Type of electrical arrangement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.2 AC-Coupled BESS advantages and disadvantages . . . . . . . . . . . . . . . . . 8
1.3 DC-Coupled BESS advantages and disadvantages . . . . . . . . . . . . . . . . . 8

2 AC-Coupled BESS 10
2.1 Battery area requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.2 Topography requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.3 AC-Coupled BESS power block . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.4 Layout generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.5 Medium voltage cables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.6 Interconnection facility integration . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.7 Energy Output . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

3 DC-Coupled BESS 18
3.1 DC-Coupled BESS power block . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.2 Layout generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3.2.1 PV plant maximum/specific capacity and BESS maximum capacity . . . 22
3.2.2 PV plant maximum/specific capacity and BESS specific capacity . . . . . 22
3.2.3 Power block outside the solar field . . . . . . . . . . . . . . . . . . . . . 22
3.2.4 Power block inside the solar field . . . . . . . . . . . . . . . . . . . . . . 24
3.3 Energy Output . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

4 Standalone BESS 27
4.1 Site requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
4.2 Topography requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
4.3 Standalone BESS power block . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
4.4 Layout generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
4.5 Medium voltage cables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

5 BESS arbitrage 34
5.1 Problem definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
5.1.1 Standalone schema . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
5.2 System definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
5.3 Degradation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
5.3.1 State of Health . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

BESS Methodology 2
 Contents

5.3.2 Applied degradation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

5.4 Optimization problem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
5.4.1 Standalone arbitrage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
5.5 Annual aggregate results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
5.5.1 Aggregated energy flows . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
5.5.2 Average captured price spread . . . . . . . . . . . . . . . . . . . . . . . . 38
5.5.3 Average daily cycles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.5.4 LCOS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Bibliography 41

BESS Methodology 3
 List of Figures

List of Figures

1.1 AC-coupled battery energy storage system diagram. Source: RatedPower . . . . 7

1.2 DC-coupled battery energy storage system diagram. Source: RatedPower . . . . 7
1.3 Stand-alone battery energy storage system diagram. Source: RatedPower . . . . 8

2.1 AC-coupled battery energy storage topography requirements. Source: RatedPower 11

2.2 Safety distances between battery power blocks. Source: RatedPower . . . . . . . 13
2.3 Optimized rotation angle of the BESS layout. Source: RatedPower . . . . . . . . 14
2.4 PCs in front at the left. PCS in side at the right. Source: RatedPower . . . . . . . 15

3.1 The battery containers are connected to all the power stations. Source: RatedPower 22
3.2 The battery containers are connected to the power station closest to the MV point.
Source: RatedPower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
3.3 Power station and battery container located outside the DC solar field. Source:
RatedPower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
3.4 Distances between containers and roads or structures. Source: RatedPower . . . 25
3.5 Power station and battery container located inside the DC solar field. Source:
RatedPower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

4.1 Standalone battery energy storage topography requirements. Source: RatedPower 28

4.2 Safety distances between battery power blocks. Source: RatedPower . . . . . . . 30
4.3 Optimized rotation angle of the BESS layout. Source: RatedPower . . . . . . . . 31
4.4 PCs in front at the left. PCS in side at the right. Source: RatedPower . . . . . . . 32

5.1 Standalone BESS dispatch diagram. Source: RatedPower . . . . . . . . . . . . . 35

BESS Methodology 4
 List of Tables

List of Tables

BESS Methodology 5
 Chapter 1. Battery energy storage system arrangements

Chapter 1

Battery energy storage system

arrangements

This chapter summarizes the possible electrical BESS arrangements that are available in the in-
dustry and the one that was prioritized for the development of RatedPower. [1]

1.1 Type of electrical arrangement

Solar panels can be coupled, or linked, to a battery either through alternating current (AC) cou-
pling or direct current (DC) coupling. AC current flows rapidly on electricity grids both forward
and backward. DC current, on the other hand, flows only in one direction. Alternatively, batter-
ies can be connected to the electric grid alone, without the need of coupling them with a solar
installation. This is called a Stand-alone BESS.

In the past, AC-coupled BESSs were most often used with residential and commercial solar in-
stallations, and DC-coupled systems were used for remote and off-grid installations, but more
options for DC-coupled systems have become available. Equipment manufacturers are devel-
oping streamlined and standardized power electronics equipment for DC-coupled BESSs. Over
the past decade, inverter technology has advanced and resulted in the development of new AC-
coupled and DC-coupled systems.

The possible layouts that can be obtained are the following ones:

1. AC Coupled BESS. In AC-coupled systems, there are separate inverters for the solar panels
and the battery. Both the solar panels and the battery module can be discharged at full
power and they can either be dispatched together or independently, creating flexibility in
how the system operates. The solar panels and battery can either share an interconnection
to the grid or run on separate interconnections.

AC BESSs comprise a lithium-ion battery module, inverters/chargers, and a battery man-

agement system (BMS). These compact units are easy to install and a popular choice for
upgrading energy systems and the systems are used for grid-connected sites as the invert-
ers tend not to be powerful enough to run off-grid.

It’s worth noting that because both the solar panel and the battery are DC-current compat-

BESS Methodology 6
 Chapter 1. Battery energy storage system arrangements

ible, the current will need to be converted three times in an AC-coupled system. Figure 1.1
illustrates the AC-coupled BESS.

Figure 1.1: AC-coupled battery energy storage system diagram. Source: RatedPower
2. DC Coupled BESS. DC-coupled systems typically use solar charge controllers, or regula-
tors, to charge the battery from the solar panels, along with a battery inverter to convert
the electricity flow to AC.

The solar panels and battery module use the same inverter and share the grid intercon-
nection, reducing the cost of equipment. This also reduces power losses from inverting
the current and running separate interconnection lines to the grid, as the solar array and
battery are dispatched as a single facility. But this offers less flexibility than an AC system.
Figure 1.1 illustrates the DC-coupled BESS.

Figure 1.2: DC-coupled battery energy storage system diagram. Source: RatedPower
3. Stand-alone BESS. This configuration is essentially an AC-coupled system without the PV
side of it. Batteries provide a great mechanism to manage the energy generated by other
sources that have no management capabilities, like most of renewable energy generation.
This ability, added to their fast reaction times and clean electrical signal (no harmonics),
make batteries alone a key element of the electric grid when aiming for higher renewable
energy penetration.

A Stand-alone BESS consist generally of a lithium-ion battery module, bi-directional in-

verter and transformer. The storage inverter and transformer are usually integrated in a
Power Conversion System (PCS).

BESS Methodology 7
 Chapter 1. Battery energy storage system arrangements

Figure 1.3: Stand-alone battery energy storage system diagram. Source: RatedPower

The software automatically generates a solution for an AC-coupled and DC-coupled BESS in PV
design, when activated. To generate a Stand-alone BESS solution, a different type of design must
be generated.

1.2 AC-Coupled BESS advantages and disadvantages

There are several benefits to using an AC-coupled BESS for your solar plant, including:

1. Retrofitting: AC-coupled batteries are easy to install on an existing solar panel system, and
more can be added to expand capacity.
2. Flexibility: Installers are not restricted in where the inverters and batteries can be located.
AC coupling works with any type of inverter.
3. Resiliency: The flexibility to install multiple inverters and batteries in different locations
helps risk of an outage if an inverter fails. Having multiple inverters provides more com-
bined power and battery faults do not have an impact on power generation.
4. Versatility: AC-coupled systems enable batteries to charge from the grid as well as the
solar panels and the grid, so if the solar panels are not generating enough electricity, the
battery can still charge from the grid.

On the other hand, the disadvantages can be listed as follows:

1. Cost: AC-coupled systems cost more than DC-coupled systems as they use multiple in-
verters.
2. Lower efficiency: The stored energy is converted three times, from the DC current to AC
current to supply the building and then back to DC current to the battery and again back
into AC. Each conversion results in a small amount of energy loss.
3. Supply limitations: AC BESSs are not designed to be used off-grid and as they are trans-
formerless, they cannot manage the surge loads from multiple appliances.

1.3 DC-Coupled BESS advantages and disadvantages

Where AC-coupled systems suffer in terms of efficiency and cost, DC-coupled systems have the
advantage:

BESS Methodology 8
 Chapter 1. Battery energy storage system arrangements

1. Affordability: DC-coupled systems tend to be cheaper than AC-coupled systems as the

solar panels and battery use a single inverter and less extra equipment such as voltage
transformers and switchgear.
2. Higher efficiency: Unlike AC systems which convert the current multiple times, DC BESSs
only convert the current once, reducing energy losses and making them more efficient.
3. Oversizing: DC-coupled systems allow solar panels to generate more electricity than the
inverter rating. The excess energy can be used to charge the battery, an EV charger or a
water heating system, whereas in an AC-coupled system the energy is lost.

On the other hand, the disadvantages can be listed as follows:

1. Limited flexibility: Installers have less flexibility than with an AC system, as the inverter
needs to be located close to the battery.
2. Less resiliency: With a single inverter in a DC-coupled system, if the inverter fails, the
solar power as well as the battery capacity is lost.

BESS Methodology 9
 Chapter 2. AC-Coupled BESS

Chapter 2

AC-Coupled BESS

This chapter describes the process for designing the layout of an AC-Coupled BESS based on main
electrical standards such as IEC and IEEE as well as practical guides. Therefore, the objective is to
obtain the dimensions of the complete layout of the system, the information related to the battery
containers, the power conversion system, the medium voltage cabling and the substation.

In the AC-Coupled schema, the batteries will be connected to the storage inverters to convert the
current from dc to ac. The AC-Coupled BESS can be split into three levels: the battery container,
the power conversion system, and the medium voltage cables. The principal elements that must
be included in every level are presented below:

Battery container

• The battery racks.

• The low voltage protection equipment.

Power conversion system

• The storage inverters. At this moment, only central inverters can be selected.
• The power transformer.
• The electrical busbar.

Medium voltage cable

The medium voltage cables are used to connect the power conversion systems into an existing
substation. The software will give all the information about the characteristics of the cables such
as material, insulator, diameter, section, cores, circuits and bundles,while taking into account
external conditions, current loads, trenching system, etc...

2.1 Battery area requirements

The criteria in RatedPower which have been set to choose an AC-coupled BESS are presented
below.

1. The user has defined a battery area.

BESS Methodology 10
 Chapter 2. AC-Coupled BESS

2. The user has chosen the AC-coupled schema as the BESS arrangement.

So, it is essential to define a battery polygon (BA) and an MV placemark within that polygon.

The size of the user-defined area will determine the space available to install the storage system.
The MV point will be the interconnection point between the battery area and the substation.

Some requirements must be considered so that RatedPower can recognize that area as the battery
area:

• The polygon defining the area of the batteries must be called BA.
• The area cannot exceed 40 ha.
• The MV placemark is mandatory, and is placed inside the BA.
• The battery polygon cannot be placed inside any AA polygon.
• The battery polygon has to be located outside the ST polygon.
• A restricted area (RA) cannot be placed inside the BA.

2.2 Topography requirements

For the AC-Coupled BESS, the surface has to be flat even if the user does not apply earthworks.
For that, earthworks will be applied to the battery area. If there is no digital elevation model
data, it will not be possible to flatten the surface. Detailed information regarding the model can
be found in [2].

Figure 4.1 illustrates the earthworks performed for an AC-coupled BESS layout.

Figure 2.1: AC-coupled battery energy storage topography requirements. Source: RatedPower

2.3 AC-Coupled BESS power block

The layout of an AC-Coupled BESS schema is dependent on the electrical parameters of the
power conversion system and the battery containers. The minimum unit or block of the BESS is
the set of a PCS and the battery containers connected to it.

The inverter type and the number of inverters per PCS can be selected, thus establishing the
power of the PCS or minimum unit of the system.

∑︁
𝑆 PCS = 𝑆 inv (2.1)

Where:

BESS Methodology 11
 Chapter 2. AC-Coupled BESS

• 𝑆 PCS is the capacity of the power conversion system. [VA]

• 𝑆 inv is the capacity of the storage inverters. [VA]

In RatedPower, we assume that the storage solution is modular. The user has to set the energy
of a battery container. Alternatively, the energy of a single battery rack and the number of racks
to include per container can be set.

𝐸 BatCont = 𝐸 rack · 𝑁 rack (2.2)

Where:

• 𝐸 BatCont is the energy of the battery container. [Wh]

• 𝐸 rack is the energy of the battery racks. [Wh]
• 𝑁 rack is the number of racks.

RatedPower will install the necessary number of containers according to the system require-
ments. The supply cycle duration is calculated using Equation 4.3.

𝐸 BatCont
ℎ= (2.3)
𝑃 PCS

Where:

• ℎ is the amount of time the batteries can be charging or discharging to the grid with the
actual PCS.
• 𝑃 PCS is the rated power of the power conversion system. [W]
• 𝐸 BatCont is the energy of the battery container. [Wh]

For example, a 2000 kW PCS and a 3000 kWh container, the supply time (time taken for a complete
charge or discharge cycle) will be 1.5 hours. If you connect two battery containers (6000 kWh)
to the same PCS, you would have a system with 3 hours of supply.

The system can be sized using power factor requirements. The required power factor at the
storage inverter’s output is calculated so the AC-coupled battery system can compensate reactive
power to comply with the requirement defined by the user. A detailed explanation of how the
required power factor is calculated can be found in our power factor methodology [3].

Then, if sizing using power factor requirements is enabled, the rated power of the power con-
version system is calculated using Equation 4.4

𝑃 PCS = 𝑆 PCS · 𝑃𝐹 (2.4)

Where:

• 𝑆 PCS is the capacity of the power conversion system. [VA]

• 𝑃𝐹 is the resulting power factor at the storage inverter’s output

BESS Methodology 12
 Chapter 2. AC-Coupled BESS

2.4 Layout generation

After having defined the power of the PCS and the capacity of a container, the BESS requirements
can be defined.

• Maximum capacity: selecting this option, the maximum possible power will be installed
in the area defined for the BESS.
• Specific capacity: The user is able to configure a specific size for the battery system by
defining the number of PCS to install. The system power will be the multiple of the PCS
power.

The following distances presented in Figure 4.2 can be found in the AC-Coupled BESS layout:

• Ds-s or the distance between adjacent blocks can be defined by the user.
• Df-f or the distance between opposing blocks can be defined by the user.
• According to [4], the safety distances between containers or Db-b is fixed to 0.9144 m (3
ft).
• According to [4], the safety distance between containers and PCSs or Db-p is fixed to 1.524
m (5 ft).

The dimensions of the battery containers and the power conversion system will be determined by
the user. In order to keep the same RatedPower philosophy with the power station dimensions of
the PV plant, the height, length and width of the container are inputs. All the battery containers
and power conversion systems will have the same dimensions.

Figure 2.2: Safety distances between battery power blocks. Source: RatedPower

The next step when generating the layout is to calculate the optimal rotation angle of the layout
for the battery placements. The idea behind this is the fact that a rectangular shape is usually
the best when it comes to placing the maximum amount of batteries. For example, for the next
polygon, the best direction to place the batteries is determined by the red arrow.

BESS Methodology 13
 Chapter 2. AC-Coupled BESS

The grey dots of the Figure 4.3 represent the area specified by the user. The big blue rectangle
is the smallest surrounding rectangle that contains the available area. The red line would be a
good direction to follow when installing the layout and the small blue rectangles are the battery
plus the PCS groups.

Figure 2.3: Optimized rotation angle of the BESS layout. Source: RatedPower

In addition, the user can edit the BESS placement by customizing the orientation angle. The
orientation angle plays a role in determining the system’s efficiency and space utilization. The
users are provided with three distinct options to set the BESS orientation according to their
specific requirements.

• Rotated (recommended/user input): For a more personalized approach, users have the flex-
ibility to define a custom orientation angle that aligns with their specific project needs or
site characteristics.
• Vertical alignment (90º): This option allows the user to choose a vertical BESS orientation,
enabling efficient use of vertical space.
• Horizontal alignment (0º): By selecting this option, the BESS layout will be aligned hori-
zontally, ensuring maximum efficiency in terms of horizontal space utilization.

After determining the number of containers per group and using the dimensions of the different
components, the group’s dimensions can be calculated individually. For this, two arrangements
can be established. The first one would be the “PCS in front" arrangement. The second configu-
ration is the “PCS in side" can be seen in Figure 4.4

As an initial approach, the PCS in front solution seems to be better in general and will be the
arrangement adopted by default.

Regarding the location of the power blocks within the battery area boundaries, the power con-
version system would be facing the MV point placed in the battery area by the user. The PCSs
will be oriented so the distance to the MV point of the battery area is reduced. Also, the battery
groups will be installed to be closer to this MV point.

BESS Methodology 14
 Chapter 2. AC-Coupled BESS

Figure 2.4: PCs in front at the left. PCS in side at the right. Source: RatedPower

2.5 Medium voltage cables

The cables that connect the power conversion systems to the primary cubicles of the intercon-
nection facility are calculated based on [5], [6] and other electrical standards. The cables will be
sized following three criteria:

• The maximum current-carrying capacity. The maximum operating current is corrected

based on the different characteristics of the installation and the site. This corrected value
must then be lower than the maximum current-carrying capacity that the cable can with-
stand.
• The voltage drop.
• The short-circuit temperature rise. When a short-circuit occurs, the amount of current
flowing through the conductor might surpass nominal current during short periods of
time, heating up the insulator. It is necessary to verify that the proposed cross-section
can withstand the maximum short-circuit current.

The most significant criterion that affects the high power cables is the maximum current-carrying
capacity. For more details about how to size the cables, it is recommended to read the electri-
cal methodology which is available in RatedPower. In this document, only the most important
parameters to size the cables are mentioned:

• Type of installation: The cables are directly buried.

• System: AC three-phase medium voltage system.
• Number of cores: Single.
• Conductor material: Aluminium.
• Insulation: XLPE.
• Soil temperature: 25ºC. To define the soil temperature correction factor.
• Soil resistivity: 1 K·m/W. To compute the soil resistivity correction factor.
• Cables’ laying depth: 0.9 m. This is an input to obtain the depth of burial correction factor.
• Number of circuits per trench. This will be taken into account to calculate the cable group-
ing correction factor.

BESS Methodology 15
 Chapter 2. AC-Coupled BESS

• Number of three-phase conductor per system. This will be taken into account to calculate
the cable grouping correction factor.

The maximum number of power conversion systems connected to the same MV circuit comply
with Equation 4.5.

𝐼 circuit ≤ 𝐼 max (2.5)

Where:

• 𝐼 circuit is the current that flows through the MV circuit. [A]

• 𝐼 max is the maximum circuit current selected by the user. [A]. By default 500 A

The length of the MV cables are calculated based on the layout generated by RatedPower.

2.6 Interconnection facility integration

The interconnection facility will take into account the capacity of the BESS output MV lines.
The output capacity of the interconnection facility is calculated using Equation 2.6 and can be
translated as the sum of the PV plant and BESS MV lines capacities.

𝑆 ST = 𝑆 PV + 𝑆 BESS (2.6)

Where:

• 𝑆 ST is the capacity of the interconnection facility. [VA]

• 𝑆 PV is the capacity of the PV MV lines. [VA]
• 𝑆 BESS is the capacity of the BESS MV lines. [VA]

The distribution of the PV and BESS MV lines to the substation complies with the following
objectives:

• The number of MV primary cubicles that are shared by PV and BESS MV lines will be at
most 1.
• The capacities of all MV primary cubicles of the substation are as balanced as possible.

2.7 Energy Output

The proposal is to provide the user with an estimation of the energy which would be available
to charge the BESS. The estimation will be a summation of two losses which are already imple-
mented in the energy yield calculation model:

• The overpower losses at the inverter. This loss is equivalent to energy available to charge
a DC coupled battery.
• The clipping losses, calculated at the substation bars. This loss is equivalent to energy
available to charge an AC coupled battery.

BESS Methodology 16
 Chapter 2. AC-Coupled BESS

Detailed information regarding the model can be found in [7]. Users can use these estimates to
feed other calculation models, such as internal tools, or other software.

BESS Methodology 17
 Chapter 3. DC-Coupled BESS

Chapter 3

DC-Coupled BESS

This chapter describes the process for designing the layout of a DC-Coupled BESS based on
main electrical standards as well as practical guides. Therefore, the objective is to obtain the
dimensions of the complete layout of the system, considering the PV plant constraints.

In the DC-Coupled schema, the batteries will be connected to the PV plant inverters to convert
the current from dc to ac. The DC-Coupled BESS can be split into the battery containers that are
located within the PV plant boundaries and the power stations of the PV plant. The principal
elements that must be included in every level are presented below:

Battery container

• The battery racks.

• The DC/DC converters.
• The low voltage protection equipment.

Power station (Power conversion system)

• The PV inverters.
• The power transformer.
• The electrical busbar.

3.1 DC-Coupled BESS power block

The criteria in RatedPower which have been set to choose a DC-coupled BESS is presented below.

1. The user has chosen the DC-coupled schema as the BESS arrangement.
2. The users has selected central inverters as the ones for the photovoltaic plant. DC-Coupled
BESS schema will not be available for PV plants with string inverters.

In addition, only primary inverters and main default power stations, those with the highest in-
verter capacity, will have storage (DC/DC converters). Non-default power stations will not have
DC/DC converters and battery containers.

BESS Methodology 18
 Chapter 3. DC-Coupled BESS

The power block of a DC-Coupled BESS schema is dependent on the electrical parameters of the
PV plant primary inverters, the DC/DC converter characteristics and the battery containers. The
minimum unit or block of the BESS is the set of a power station and the DC/DC converter and
battery containers connected to it.

The DC/DC converter power per inverter is calculated by Equation 3.1 and the BESS/PV power
ratio is given in Equation 3.2.

𝑃 DC/DC-inv = 𝑁 DC/DC · 𝑃 DC/DC (3.1)

𝑁 DC/DC · 𝑃 DC/DC
𝑅BESS/PV = (3.2)
𝑃 inv

Where:

• 𝑃DC/DC-inv is the DC/DC converter power per inverter. [W]

• 𝑁 DC/DC is the number of DC/DC converters per inverter.
• 𝑃DC/DC is the DC/DC converter power. [W]
• 𝑅BESS/PV is the BESS/PV power ratio.
• 𝑃 inv is the primary inverter active power. [W]

The DC/DC converters (buck/boost converter) change (step up/down) the battery voltage to the
inverter input voltage (equivalent to the string voltage of the PV plant). A generic converter
power can be defined as a program input. That is, the maximum continuous power (included in
the DC/DC databases).

The recommended converter power value is given in Equation 3.3.

𝑅BESS/PV recommended · 𝑃 inv

𝑃 DC/DC recommended = (3.3)
𝑁 DC/DC recommended

Where:

• 𝑃DC/DC recommended is the recommended DC/DC converter power. [W]

• 𝑅BESS/PV recommended is equal to 0.5.
• 𝑃inv is the active power of the PV inverters. [W]
• 𝑁 DC/DC recommended is the recommended number of DC/DC converter per inverter and equals
to 2.

The maximum DC/DC converter power is derived from Equation 3.4.

1.5 · 𝑃 inv
𝑃 DC/DC max = (3.4)
𝑁 DC/DC

Where:

BESS Methodology 19
 Chapter 3. DC-Coupled BESS

• 𝑃DC/DC max is the maximum DC/DC converter power. [W]

• 𝑃inv is the active power of the PV inverters. [W]
• 𝑁 DC/DC max is the number of DC/DC converter per inverter.

The minimum DC/DC converter power is derived from Equation 3.5.

0.1 · 𝑃 inv
𝑃 DC/DC min = (3.5)
𝑁 DC/DC

Where:

• 𝑃DC/DC min is the minimum DC/DC converter power. [W]

• 𝑃inv is the active power of the PV inverters. [W]
• 𝑁 DC/DC max is the number of DC/DC converter per inverter.

Once the maximum continuous power per converter have been set, the number of converters
for central inverter can be defined. The maximum number of converters per inverter is given in
Equation 3.6.

𝑃 DC/DC
𝑁 DC/DC max = ≤ 1.5 (3.6)
𝑃 inv

Where:

• 𝑁 DC/DC max is the maximum number of DC/DC converter per inverter.

• 𝑃 DC/DC is the total converter power. [W]
• 𝑃 inv is the active power of the PV inverters. [W]

And the power conversion system discharge power is given in Equation 3.7.

𝑃 PCS = 𝑚𝑖𝑛(1, 𝑅BESS/PV ) · 𝑃 inv · 𝑁 inv (3.7)

Where:

• 𝑃 PCS is the discharge power of the system. [W]

• 𝑅BESS/PV is the BESS/PV power ratio.
• 𝑃 inv is the active power of the primary inverter. [W]
• 𝑁 inv is the number of primary inverters in the power station.

In RatedPower, we assume that the storage solution is modular. The user has to set the energy
of a battery container. Alternatively, the energy of a single battery rack and the number of racks
to include per container can be set.

𝐸 BatCont = 𝐸 rack · 𝑁 rack (3.8)

Where:

BESS Methodology 20
 Chapter 3. DC-Coupled BESS

• 𝐸 BatCont is the energy of the battery container. [Wh]

• 𝐸 rack is the energy of the battery racks. [Wh]
• 𝑁 rack is the number of racks.

RatedPower will install the necessary number of containers according to the system require-
ments. The supply cycle duration is calculated in Equation 3.9.

𝐸 BatCont
ℎ= (3.9)
𝑃 PCS

Where:

• ℎ is the amount of time the batteries can be discharging from the grid. The charging hours
might be higher than supply hours defined. The maximum hours of supply are 24 hours.
• 𝑃PCS is the discharge power of the system. [W]
• 𝐸 BatCont is the energy of the battery container. [Wh]

The maximum number of battery containers that can be connected to the power station will be
6. By default, 1 container per PS will be recommended.

3.2 Layout generation

After having defined the power block, the BESS requirements can be defined.

• Maximum capacity: selecting this option, the maximum possible power will be installed.
All default power stations will have battery containers, only the primary central inverters
of those power stations. It is not possible for a non-default power station to have storage.
• Specific capacity: The user defines the amount of desired power stations with battery con-
tainers to install. Default power stations will have battery containers, only the primary
central inverters of those power stations. It is not possible for a non-default power station
to have storage. The desired rated power is calculated using Equation 3.10.

𝐵𝐸𝑆𝑆 = 𝑁 desired ps · 𝑃 PCS (3.10)

Where:

– 𝐵𝐸𝑆𝑆 is the desired BESS total rated power. [W]

– 𝑃PCS is the discharge power of the system. [W]
– 𝑁 desired ps is number of desired power stations with battery containers to install.

However, the real amount of power stations will be calculated after running the design
since it depends on how many main power stations are going to be installed.

BESS Methodology 21
 Chapter 3. DC-Coupled BESS

3.2.1 PV plant maximum/specific capacity and BESS maximum capacity

In this case, all the primary inverters in the default power stations will be connected to battery
containers.

Figure 3.1: The battery containers are connected to all the power stations. Source: RatedPower

3.2.2 PV plant maximum/specific capacity and BESS specific capacity

In this case, the closest default power stations to the MV point of the available area will be
connected to battery containers.

3.2.3 Power block outside the solar field

When the power stations of the PV plant are out of the solar field, the batteries will be aligned
to the road, as can be seen in Figure 3.3.

The dimensions of the battery containers will be determined by the user. In order to keep the
same RatedPower philosophy with the power station dimensions of the PV plant, the height,
length and width of the container would be the inputs. All the battery containers will have the
same dimensions.

The following distances are taken into account in order to locate the battery containers close to
the power stations:

• The battery container to road distance can be defined as a setback. The same value limits
will be considered for setbacks as those currently considered for the power stations to road
distances. The minimum value will be 1.5 m and the maximum value lower than 100 m.
• According to the NFPA 855 standard, the safety distance between containers and structures
must be greater than 1.524 m (5 ft) and less than 4.572 m (15 ft).

BESS Methodology 22
 Chapter 3. DC-Coupled BESS

Figure 3.2: The battery containers are connected to the power station closest to the MV point.
Source: RatedPower

• According to the NFPA 855 standard, the safety distance between containers must be
greater than 0.9144 m (3 ft) and less than 4.572 m (15 ft).
• According to the NFPA 855 standard, the safety distance between containers and the power
station must be greater than 1.524 m (5 ft) and less than 4.572 m (15 ft).

So, the distances presented in Figure 3.4 from the axis of the battery container - power station
block to the roads will be:

𝐷 axis-road = 𝑀𝑎𝑥 (𝑑 PS-road + 0.5 · 𝑤 PS, 𝑑 BESS-road + 0.5 · 𝑤 BESS ) (3.11)

Where:

• 𝐷 axis-road is the distance of the axis of the block to the road. [m]
• 𝑑 PS-road is the distance from the power stations to the road [m]. The minimum 𝑑 PS-road is
equal to 1.5 m.
• 𝑤 PS is width of the power station. [m]
• 𝑑 BESS-road is the distance from the battery container to the road. [m]
• 𝑤 BESS is width of the battery container. [m]

𝐷 axis-structure = 𝑀𝑎𝑥 (𝑑 PS-structure + 0.5 · 𝑤 PS, 𝑑 BESS-structure + 0.5 · 𝑤 BESS ) (3.12)

Where:

BESS Methodology 23
 Chapter 3. DC-Coupled BESS

Figure 3.3: Power station and battery container located outside the DC solar field. Source: Rat-
edPower

• 𝐷 axis-structure is the distance of the axis of the block to the structures. [m]
• 𝑑 PS-structure is the distance from the power stations to the structures. [m]
• 𝑤 PS is width of the power station. [m]
• 𝑑 BESS-structure is the distance from the battery container to the structures. [m]
• 𝑤 BESS is width of the battery container. [m]

3.2.4 Power block inside the solar field

When the power stations of the PV plant are out of the solar field, the batteries will also be
installed within the solar field, as can be seen in Figure 3.5.

The arrangement of the power station and the battery containers must meet the following con-
ditions:

• The PS must have direct access to the road (i.e. one of its sides must be in contact with the
road, without containers or structures in between).
• The PS should be placed parallel or perpendicular to the structures.
• The battery containers can be placed parallel or perpendicular to the structures.
• The selected arrangement should be the one that deletes the fewest structures. If aligning
the containers in the same row deletes the same amount of structures as having more than
one row of containers, the case where all the containers are aligned is prioritized.

BESS Methodology 24
 Chapter 3. DC-Coupled BESS

Figure 3.4: Distances between containers and roads or structures. Source: RatedPower

The dimensions of the battery containers will be determined by the user. In order to keep the
same RatedPower philosophy with the power station dimensions of the PV plant, the height,
length and width of the container are inputs. All the battery containers will have the same
dimensions.

The following distances are taken into account in order to locate the battery containers:

• According to [4], the safety distance between containers must be greater than 0.9144 m (3
ft) and less than 4.572 m (15 ft).
• According to [4], the safety distance between containers and the power station must be
greater than 1.524 m (5 ft) and less than 4.572 m (15 ft).

3.3 Energy Output

The proposal is to provide the user with an estimation of the energy which would be available
to charge the BESS. The estimation will be a summation of two losses which are already imple-
mented in the energy yield calculation model:

• The summatory of the overpower losses at the inverters with storage. This loss is equiva-
lent to the energy available to charge a DC coupled battery.
• The summatory of the overpower losses at the inverters without storage. This loss cannot
be recovered because these inverters do not have DC/DC converters or batteries to store
these losses.

Detailed information regarding the model can be found in [7]. Users can use these estimates to
feed other calculation models, such as internal tools, or other software.

BESS Methodology 25
 Chapter 3. DC-Coupled BESS

Figure 3.5: Power station and battery container located inside the DC solar field. Source: Rated-
Power

BESS Methodology 26
 Chapter 4. Standalone BESS

Chapter 4

Standalone BESS

This chapter describes the process for creating a Standalone BESS design. Whilst AC-coupled
and DC-coupled BESS are elements added to a PV plant design, a Standalone BESS plant is a
different type of design. To create one, the user can select Standalone BESS in the drop-down
menu when starting a new design.

In the Standalone schema, the batteries will be connected to the storage inverters to convert the
current from dc to ac. The Standalone BESS can be split into three levels: the battery container,
the power conversion system, and the medium voltage cables. The principal elements that must
be included in every level are presented below:

Battery container

• The battery racks.

• The low voltage protection equipment.

Power conversion system

• The storage inverters. At this moment, only central inverters can be selected.
• The power transformer.
• The electrical busbar.

Medium voltage cable

The medium voltage cables are used to connect the power conversion systems into an existing
substation. The software will give all the information about the characteristics of the cables such
as material, insulator, diameter, section, cores, circuits and bundles,while taking into account
external conditions, current loads, trenching system, etc...

4.1 Site requirements

To create a Standalone BESS design in RatedPower, the site must be defined with at least the
following elements:

1. One battery area (BA).

BESS Methodology 27
 Chapter 4. Standalone BESS

2. One MV placemark, within the BA polygon.

Currently, RatedPower only allows for the definition of a single battery area. The size of this
user-defined area will determine the space available to install the storage system. The MV point
will be the interconnection point between the battery area and the evacuation line. Athough at
the moment, no interconnection facilities are considered for Standalone BESS designs.

If the user defines other site elements, such as AA polygons, ST or RA polygons, RatedPower
will ignore these elements while the following requirements are fulfilled:

• The polygon defining the area of the batteries must be called BA.
• The area cannot exceed 40 ha.
• The MV placemark is mandatory, and is placed inside the BA.
• The battery polygon cannot be placed inside any AA polygon.
• The battery polygon has to be located outside the ST polygon.
• A restricted area (RA) cannot be placed inside the BA.

4.2 Topography requirements

For the Standalone BESS, the surface has to be flat and earthworks will be calculated and applied
automatically to the battery area. If there is no digital elevation model data available, RatedPower
will assume the terrain is flat to continue with the simulation. Detailed information regarding
the model can be found in [2].

Figure 4.1 illustrates the earthworks performed for an Standalone BESS layout.

Figure 4.1: Standalone battery energy storage topography requirements. Source: RatedPower

4.3 Standalone BESS power block

The layout of an Standalone BESS schema is dependent on the electrical parameters of the power
conversion system and the battery containers. The minimum unit or block of the BESS is the set
of a PCS and the battery containers connected to it.

The inverter type and the number of inverters per PCS can be selected, thus establishing the
power of the PCS or minimum unit of the system.

∑︁
𝑆 PCS = 𝑆 inv (4.1)

Where:

BESS Methodology 28
 Chapter 4. Standalone BESS

• 𝑆 PCS is the capacity of the power conversion system. [VA]

• 𝑆 inv is the capacity of the storage inverters. [VA]

In RatedPower, we assume that the storage solution is modular. The user has to set the energy
of a battery container. Alternatively, the energy of a single battery rack and the number of racks
to include per container can be set.

𝐸 BatCont = 𝐸 rack · 𝑁 rack (4.2)

Where:

• 𝐸 BatCont is the energy of the battery container. [Wh]

• 𝐸 rack is the energy of the battery racks. [Wh]
• 𝑁 rack is the number of racks.

RatedPower will install the necessary number of containers according to the system require-
ments. The supply cycle duration is calculated using Equation 4.3.

𝐸 BatCont
ℎ= (4.3)
𝑃 PCS

Where:

• ℎ is the amount of time the batteries can be charging or discharging to the grid with the
actual PCS.
• 𝑃 PCS is the rated power of the power conversion system. [W]
• 𝐸 BatCont is the energy of the battery container. [Wh]

For example, a 2000 kW PCS and a 3000 kWh container, the supply time (time taken for a complete
charge or discharge cycle) will be 1.5 hours. If you connect two battery containers (6000 kWh)
to the same PCS, you would have a system with 3 hours of supply.

The system can be sized using power factor requirements. The required power factor at the
storage inverter’s output is calculated so the battery system can compensate reactive power to
comply with the requirement defined by the user. A detailed explanation of how the required
power factor is calculated can be found in our power factor methodology [3].

Then, if sizing using power factor requirements is enabled, the rated power of the power con-
version system is calculated using Equation 4.4

𝑃 PCS = 𝑆 PCS · 𝑃𝐹 (4.4)

Where:

• 𝑆 PCS is the capacity of the power conversion system. [VA]

• 𝑃𝐹 is the resulting power factor at the storage inverter’s output

BESS Methodology 29
 Chapter 4. Standalone BESS

4.4 Layout generation

After having defined the power of the PCS and the capacity of a container, the BESS requirements
can be defined.

• Maximum capacity: selecting this option, the maximum possible power will be installed
in the area defined for the BESS.
• Specific capacity: The user is able to configure a specific size for the battery system by
defining the number of PCS to install. The system power will be the multiple of the PCS
power.

The following distances presented in Figure 4.2 can be found in the Standalone BESS layout:

• Ds-s or the distance between adjacent blocks can be defined by the user.
• Df-f or the distance between opposing blocks can be defined by the user.
• According to [4], the safety distances between containers or Db-b is fixed to 0.9144 m (3
ft).
• According to [4], the safety distance between containers and PCSs or Db-p is fixed to 1.524
m (5 ft).

The dimensions of the battery containers and the power conversion system will be determined by
the user. In order to keep the same RatedPower philosophy with the power station dimensions of
the PV plant, the height, length and width of the container are inputs. All the battery containers
and power conversion systems will have the same dimensions.

Figure 4.2: Safety distances between battery power blocks. Source: RatedPower

The next step when generating the layout is to calculate the optimal rotation angle of the layout
for the battery placements. The idea behind this is the fact that a rectangular shape is usually
the best when it comes to placing the maximum amount of batteries. For example, for the next
polygon, the best direction to place the batteries is determined by the red arrow.

BESS Methodology 30
 Chapter 4. Standalone BESS

The grey dots of the Figure 4.3 represent the area specified by the user. The big blue rectangle
is the smallest surrounding rectangle that contains the available area. The red line would be a
good direction to follow when installing the layout and the small blue rectangles are the battery
plus the PCS groups.

Figure 4.3: Optimized rotation angle of the BESS layout. Source: RatedPower

In addition, the user can edit the BESS placement by customizing the orientation angle. The
orientation angle plays a role in determining the system’s efficiency and space utilization. The
users are provided with three distinct options to set the BESS orientation according to their
specific requirements.

• Rotated (recommended/user input): For a more personalized approach, users have the flex-
ibility to define a custom orientation angle that aligns with their specific project needs or
site characteristics.
• Vertical alignment (90º): This option allows the user to choose a vertical BESS orientation,
enabling efficient use of vertical space.
• Horizontal alignment (0º): By selecting this option, the BESS layout will be aligned hori-
zontally, ensuring maximum efficiency in terms of horizontal space utilization.

After determining the number of containers per group and using the dimensions of the different
components, the group’s dimensions can be calculated individually. For this, two arrangements
can be established. The first one would be the “PCS in front" arrangement. The second configu-
ration is the “PCS in side" can be seen in Figure 4.4

As an initial approach, the PCS in front solution seems to be better in general and will be the
arrangement adopted by default.

Regarding the location of the power blocks within the battery area boundaries, the power con-
version system would be facing the MV point placed in the battery area by the user. The PCSs
will be oriented so the distance to the MV point of the battery area is reduced. Also, the battery
groups will be installed to be closer to this MV point.

BESS Methodology 31
 Chapter 4. Standalone BESS

Figure 4.4: PCs in front at the left. PCS in side at the right. Source: RatedPower

4.5 Medium voltage cables

In the current version of RatedPower, the interconnection facilities aren’t considered in Stan-
dalone BESS designs. The cables are generated from the power conversion systems to the MV
placemark defined by the user, and they are calculated based on [5], [6] and other electrical
standards. The cables will be sized following three criteria:

• The maximum current-carrying capacity. The maximum operating current is corrected

based on the different characteristics of the installation and the site. This corrected value
must then be lower than the maximum current-carrying capacity that the cable can with-
stand.
• The voltage drop.
• The short-circuit temperature rise. When a short-circuit occurs, the amount of current
flowing through the conductor might surpass nominal current during short periods of
time, heating up the insulator. It is necessary to verify that the proposed cross-section
can withstand the maximum short-circuit current.

The primary criterion influencing high-power cables is their maximum current-carrying capac-
ity. Cable sizing is conducted in accordance with various electrical standards, as outlined in [8].
This document highlights only the most critical parameters involved in cable sizing:

• Type of installation: The cables are directly buried.

• System: AC three-phase medium voltage system.
• Number of cores: Single.
• Conductor material: Aluminium.
• Insulation: XLPE (for IEC, AUS and CN standards) and XHHN (for NEC).
• Soil temperature: 25ºC. To define the soil temperature correction factor.
• Soil resistivity: 1 K·m/W. To compute the soil resistivity correction factor.
• Cables’ laying depth: 0.9 m. To obtain the depth of burial correction factor.
• Number of circuits per trench. To calculate the cable grouping correction factor.

BESS Methodology 32
 Chapter 4. Standalone BESS

• Number of three-phase conductor per system. To calculate the cable grouping correction
factor.

The number of MV circuits needed is calculated based on the maximum number of power con-
version systems that can be connected to the same MV circuit. This limit is set by Equation 4.5.

𝐼 circuit ≤ 𝐼 max (4.5)

Where:

• 𝐼 circuit is the current that flows through the MV circuit. [A]

• 𝐼 max is the maximum circuit current. [A]. It’s set to 500 A

The maximum current that flows through the MV circuit is calculated using Equation 4.6:

𝑃t
𝐼 circuit = √ (4.6)
𝑈 3

Where:

• 𝐼 circuit is the current that flows through the MV circuit. [A]

• 𝑃t is the aggregated capacity of the power transformers connected to the MV circuit. [VA]
• 𝑈 is the medium voltage level. [V]

Following the above criteria, the number of MV circuits needed and the power conversion sys-
tems connected to each circuit is obtained. RatedPower will try to reach the established maxi-
mum current limit for each MV circuit, while balancing the MV circuit length to minimize losses.

The length of the MV cables is then calculated based on the layout generated by RatedPower.
For more information regarding MV cabling and transformers please refer to the Interconnec-
tion Facility Methodology [9].

BESS Methodology 33
 Chapter 5. BESS arbitrage

Chapter 5

BESS arbitrage

This chapter describes the model used to calculate the charge and discharge of the BESS. The
model emulates the decision-making that takes place when operating a BESS with the objective
of maximizing the revenue obtained from its services. The main factor driving these decisions
will be the energy prices, and the PV generation in case of a hybrid plant.

There are multiple remuneration mechanisms for a BESS depending on the markets and regula-
tions of each country. Usually, BESS owners and operators will mix different dispatch strategies
to stack multiple revenue sources and maximize their profit. This model focuses on an arbitrage
strategy.

5.1 Problem definition

The objective of the dispatch model is to calculate the energy charge and discharge of the BESS
that maximizes the revenue. To do so, the system is defined as linear problem and solved using
linear programming. Depending on the connection schema, a different system is defined.

5.1.1 Standalone schema

In a standalone schema, the problem is defined by two elements that exchange energy between
them: the BESS and the grid. Figure 5.1 shows the schematic diagram of the system and the
energy flows, where:

• S is the energy stored in the BESS.

• D is the energy discharged from the BESS to the grid.
• F is the energy consumed from the grid to charge the BESS.

BESS Methodology 34
 Chapter 5. BESS arbitrage

Figure 5.1: Standalone BESS dispatch diagram. Source: RatedPower

5.2 System definition

The model assumes that the whole BESS works like a unit, so all batteries charge and discharge
at the same time. Therefore, to define the system the model is fed with the following inputs:

• Total capacity: Is the total BESS capacity, based on the power requirements and supply
hours.
• Total rated power: Is the total PCS rated power, based on the power requirements.
• Battery round-trip efficiency (RTE): Is the efficiency of a full charge and discharge cycle.
During the charge and discharge process energy is lost, and its represented by an efficiency
percentage. The model assumes that the charge and discharge efficiencies are equal, so the
value of each results in the square root of the RTE.
• Initial State of Charge (SoC): Is the initial charge of the batteries, represented as a percent-
age of the total capacity. The dispatch model is initialized with this value, and it must be
between the maximum and minimum allowed SoC.
• Maximum State of Charge: Is the maximum allowed charge of the batteries, represented as
percentage of the total capacity. This value must be at least 10% higher than the minimum
SoC so the BESS has a minimum available capacity to operate.
• Minimum State of Charge: Is the minimum allowed charge of the batteries, represented as
percentage of the total capacity. This value must be at least 10% lower than the maximum
SoC so the BESS has a minimum available capacity to operate.
• Daily cycles: Is the maximum number of cycles that the batteries are allowed to complete
over 24 hours. A cycle is completed when the battery charges and discharges for its full
available capacity.
• Yearly degradation: Is the percentage of the capacity of the BESS that’s reduced each year.
This value can go from 0 to 20%.
• End-of-life State of Health: Is the health limit of the battery below which the battery is
considered unavailable. It’s represented as a percentage of the BESS nominal capacity.

BESS Methodology 35
 Chapter 5. BESS arbitrage

5.3 Degradation
Battery degradation refers to the gradual decline in the ability of a battery to store and deliver
energy. This process can result in reduced energy capacity, range, power, and overall efficiency.
Two degradation mechanisms can be differentiated:

• Calendar degradation: this mechanism increases the degradation of the battery with time,
regardless of whether it is being used or idle.
• Cycling degradation: this mechanism increases the degradation of the battery with use.
For a BESS that’s being used everyday, the calendar degradation is negligible compared to
the cycling degradation, so only the later is considered in the model.

5.3.1 State of Health

The State of Health (SoH) of the battery describes the health of the battery, compared to its ini-
tial condition. It’s the ratio between the current degraded capacity and its initial capacity, and
it’s represented as a percentage. The SoH is reduced each year of operation based on the yearly
degradation input.

When the SoH of the battery is reduced past the defined End-of-Life (EoL) value, the battery’s
useful life has been consumed, and the simulation ends. In the case of a hybrid system, once the
EoL-SoH is reached, the battery is considered unavailable until the defined simulation years for
the PV plant have ended.

The maximum number of simulation years for Standalone BESS systems is 25. If the EoL-SoH is
not reached by that year, the simulation will stop at that point. The reason behind this limit is
that life expectancy for Lithium-ion batteries is between 10 and 20 years at best, depending on
the cycling.

5.3.2 Applied degradation

As the reduction of the SoH over the year is considered linear, the degradation applied for each
year will be the average between the degradation at the end of the previous year and the current
one. In other words, the degradation applied for the first year will be half of the yearly degrada-
tion input, and so on.

Following this criteria, the SoH applied each year is given by Equation 5.1:

𝑑
𝑠𝑜ℎ year = (1 − ) (1 − 𝑑) 𝑦𝑒𝑎𝑟 −1 (5.1)
2

Where:

• d is the yearly degradation fraction.

• year is the operational year.

BESS Methodology 36
 Chapter 5. BESS arbitrage

5.4 Optimization problem

The objective of the optimization problem is to maximize the profit of the system. To do so,
the model will try to find the values of the defined variables at each time step that meet that
condition, while they comply with the restrictions inherent to each system.

5.4.1 Standalone arbitrage

To solve the linear programming problem, first the objective function is defined. In a standalone
system, the revenue source is the energy discharged from the BESS to the grid, and the expenses
come from the energy consumed from the grid to charge the BESS. The objective function to
maximize the system profit follows then Equation 5.2:

n
∑︁
𝐷 t · 𝑝 t · 𝜂 d − 𝐹𝑡 · 𝑝 t (5.2)
t=0

Where:

• 𝐷 t is the energy discharged to the grid at an instant 𝑡.

• 𝐹 t is the energy consumed from the grid at an instant 𝑡.
• 𝑝 t is the energy price at an instant 𝑡.
• 𝜂 d is the discharge efficiency of the BESS.

The optimum values for each of the variables must follow a set of restrictions. The first restriction
defined is the energy balance of the system, represented by Equation 5.3:

𝑆 t = 𝑆 t-1 + 𝐹 t · 𝜂 c − 𝐷 t (5.3)

Where:

• 𝑆 t is the energy stored in the BESS at an instant 𝑡.

• 𝑆 t-1 is the energy stored in the BESS the previous instant.
• 𝜂 c is the charge efficiency of the BESS.

The energy stored in the BESS must be between the boundaries defined by its usable capacity,
that’s affected by the yearly degradation and the defined SoC limits:

𝑐 · 𝑠𝑜ℎ year · 𝑠𝑜𝑐 min ≤ 𝑆 t ≤ 𝑐 · 𝑠𝑜ℎ year · 𝑠𝑜𝑐 max (5.4)

Where:

• 𝑐 is the nominal capacity of the BESS.

• 𝑠𝑜ℎ year is the SoH of the BESS for the simulated year.
• 𝑠𝑜𝑐 min is the minimum allowed SoC.
• 𝑠𝑜𝑐 max is the maximum allowed SoC.

BESS Methodology 37
 Chapter 5. BESS arbitrage

The charge and discharge limits are given by the rated power of the storage inverters:

𝐹 t ≤ 𝑝 inv (5.5a)
𝐷 t ≤ 𝑝 inv (5.5b)

Where 𝑝 inv is the total rated power of the BESS.

Lastly, a restriction for the number of cycles done in a day is defined. This is done by limit-
ing the amount of energy charged and discharged from the BESS every 24 hours, which also
considers the SoC boundaries and yearly SoH:

24
∑︁
𝐷 t ≤ (𝑠𝑜𝑐 max − 𝑠𝑜𝑐 min ) · 𝑠𝑜ℎ year · 𝑐 · 𝑛 cycles for each 24 hours (5.6a)
t=0
24
∑︁ 1
𝐹 t ≤ (𝑠𝑜𝑐 max − 𝑠𝑜𝑐 min ) · 𝑠𝑜ℎ year · 𝑐 · 𝑛 cycles · for each 24 hours (5.6b)
t=0
𝜂c

Where 𝑛 cycles is the maximum number of cycles allowed per day.

5.5 Annual aggregate results

The optimum solution found by the model is used to calculate the annual aggregated energy
flows, and other indicators that help compare different system configurations. Also, the hourly
revenue and expenses results are used in the financial analysis [10].

5.5.1 Aggregated energy flows

The total energy discharged by the BESS and injected into the grid is aggregated for the first year,
and for all the simulated years. This energy is measured at the point of injection, so it considers
the round-trip efficiency of the system.

The total energy consumed from the grid is the aggregation of all the energy consumed from
the grid to charge the BESS for the first year, measured at the point of interconnection.

5.5.2 Average captured price spread

The price spread over a time period is the difference between the highest and lowest energy price
of that period. In an arbitrage strategy, the daily price spread is an indicator of the obtainable
profit when charging the BESS in the cheapest hour of the day and discharging it in the most
expensive one. It’s measured in the same units as the energy price.

During the operation of the BESS, this might not charge and discharge in a single hour if the
supply duration is higher, or it might not be possible to charge during the cheapest hour and
discharge during the most expensive due to multiple reasons, like the cheapest hour happening
later than the most expensive one during the day. Added to this, the losses incurred during the
charge and discharge processes make it even harder to use the price spread as a truth-worthy
indicator.

BESS Methodology 38
 Chapter 5. BESS arbitrage

The captured spread is the actual price difference between the hours that the BESS is discharged
and charged in the results yield by the model. It considers the energy consumed from the grid,
the actual energy discharged into the grid (which will usually be lower due to the losses), and
the price average at which both processes happen. The average daily price spread is given by
Equation 5.7b

Í24
· 𝑝 t · 𝜂 d − 24
Í
t=0 𝐷 t t=0 𝐹 t · 𝑝 t
𝑠 day = Í24 for a given day (5.7a)
t=0 𝐷 t · 𝜂 d
365
1 ∑︁
𝑠= 𝑠 day (5.7b)
365 d=1

Where:

• 𝑠 day is the price spread for a given day

• 𝑠 is the average daily price spread over a year

This value is calculated only for the first year of operation.

5.5.3 Average daily cycles

The average daily cycles is the resulting number of charge and discharge cycles performed over
a year, divided by 365. As the number of cycles is defined as an upper limit, the optimization
model might decide not to cycle the battery as much due to the price signal being inadequate.

This value indicates the actual usage of the battery during the first year of operation and al-
lows the user to adjust the defined yearly degradation accordingly. Equation 5.8 shows how this
value is calculated:

Í8760
t=1 𝐷t
Avg. daily cycles = (5.8)
(𝑠𝑜𝑐 max − 𝑠𝑜𝑐 min ) · 𝑠𝑜ℎ year · 𝑐 · 𝑛 cycles · 365

5.5.4 LCOS
The Levelized Cost of Storage (LCOS) is a measure of the average present cost of electricity dis-
charged , accounting for all costs incurred to install, charge, and discharge the energy storage
system, throughout its lifetime. This indicator is the equivalent of the LCOE of a PV plant.

Another definition of LCOS, which is more specifically related to the storage of electricity than
to the generation per se, excludes the cost of charging the storage that is not related to cycle
efficiency and other losses.

In RatedPower, since we are considering the resulting discharged energy from the model for
the calculation, and this depends on the energy prices, we think it is more accurate to consider
also the costs of charging the BESS in the LCOS calculation:

BESS Methodology 39
 Chapter 5. BESS arbitrage

Í 𝑂𝑃𝐸𝑋 year +𝐸𝐶 year

𝐶𝐴𝑃𝐸𝑋 + 𝑛year=1 (1+𝑟 ) year
𝐿𝐶𝑜𝑆 = Í𝑛 𝐷 year
(5.9)
year=1 (1+𝑟 ) year

Where:

• 𝑟 is discount rate.
• 𝐸𝐶 year is the total costs of consuming energy to charge the BESS over the year.
• 𝐷 year is the total energy discharged to the grid during the year.

BESS Methodology 40
 Bibliography

Bibliography

[1] N. Opie. “Ac vs dc-coupled bess: The pros and cons.” (Apr. 2023), [Online]. Available: https:
//ratedpower.com/blog/ac-vs-dc-coupled-bess/.
[2] F. I. Pérez Cicala, M. Bennekers Vallejo and M. A. Torrero Rionegro, “Topography Analysis
Methodology,” RatedPower, 2023.
[3] F. I. Pérez Cicala, I. Álvarez Iberlucea, M. A. Torrero Rionegro, A. Benito Oliva, “Power
Factor Methodology,” RatedPower, 2023.
[4] Energy Storage Systems Committee, “Standard for the Installation of Stationary Energy
Storage Systems,” National Fire Protection Association, NFPA 855, 2023.
[5] Technical Committee 20, “Power cables with extruded insulation and their accessories for
rated voltages from 1 kV (Um = 1,2 kV) up to 30 kV (Um = 36 kV) - Part 2: Cables for rated
voltages from 6 kV (Um = 7,2 kV) up to 30 kV (Um = 36 kV),” International Electrotechnical
Commision, IEC 60502-2:2014, 2014.
[6] National Electrical Code Committee, “NFPA 70 National Electrical Code,” International
Standard, 2017.
[7] F. I. Pérez Cicala, Á. Pajares Barroso, J. Romero González and M. A. Torrero Rionegro,
“pvDesign Energy Yield Methodology,” RatedPower, 2023.
[8] I. Álvarez Iberlucea, A. Pajares Barroso, A. Benito Oliva, P. Boncheva, H. Farhat, F. I. Pérez
Cicala, M. A. Torrero Rionegro, “Electrical Methodology,” RatedPower, 2024.
[9] I. Álvarez Iberlucea, S. Jermouni, A. Benito Oliva, M. A. Torrero Rionegro, F. I. Pérez Cicala,
J. Romero González, “Interconnection Facility Methodology,” RatedPower, 2024.
[10] J. Contreras. “How to carry out a complete financial analysis in ratedpower.” (Oct. 2024),
[Online]. Available: https://help.ratedpower.com/s/article/how- to- create- a- complete-
financial-analysis-in-ratedpower?language=en_US.

BESS Methodology 41