Multi-Stage Formulation for Balancing and Electricity Spot Market Participation of Large-Scale Battery Energy Storage Systems

Inhalt:
The frequency containment reserve (FCR) in Germany marked the first major application of large-scale battery energy storage systems (BESS), until market saturation was reached. Since then, a rising share of renewable energy sources (RES), wider spot market price spreads, and declining installation costs have renewed interest in BESS as a valuable source of flexibility for grid stability and improved RES integration. To unlock further economic potential, this study proposes a hierarchical energy management (EM) concept for the multi-use operation of BESS. The key innovation lies in the multi-stage formulation of the FCR auction, which ensures the reservation of sufficient capacity for FCR participation while incorporating expected day-ahead market (DAM) participation during FCR bidding. This enables optimization of the trade-off between immediate market opportunities and anticipated future revenue. The approach ensures compliance with regulatory requirements in Germany while enabling explicit modeling of interdependencies between market segments. Deviations from planned schedules are mitigated through active state-of-energy (SOE) control via intraday continuous market (IDM) participation. The concept is validated using simulations of a real-world BESS (11 MW, 11 MWh), including a rule-based string management strategy to improve part-load efficiency. Results for a selected period demonstrate the viability of the multi-stage formulation. Compared to static allocation, the approach yields over 8 % higher profit and slightly reduced cyclic stress. These findings confirm the operational feasibility of the proposed approach and its potential for interdependent market participation. Future work will extend the concept to additional balancing markets, storage hybridization, and stochastic optimization under uncertainty.