A two-level optimization framework for battery energy storage systems to enhance economics and minimize long-term capacity fading

• Published in: Journal of energy storage Vol. 63; p. 106943
• Main Authors: Yao, Jiwei, Hedengren, John D., Gao, Tao, Powell, Kody M.
• Format: Journal Article
• Language: English
• Published: Elsevier Ltd 01.07.2023
• Subjects: Battery simulation; Capacity fading; Energy storage; Grid; Lithium-ion battery; Optimization; Lithium-ion battery; Capacity fading; Battery simulation; Optimization; Grid; Energy storage
• ISSN: 2352-152X; 2352-1538
• DOI: 10.1016/j.est.2023.106943

This paper proposes a two-level optimization framework for a battery energy storage system to maximize revenue with consideration of the phenomena that cause battery's capacity fading. Instead of solving the scheduling problem as a singular problem, a two-level optimization framework is introduced. The upper-level optimization focuses on maximizing revenue by arbitrage in a real-time electricity market. With the determined operating schedule, the lower-level optimization, solved with particle swarm optimization, determines the optimal charging current that mitigates the side reactions while maintaining economic performance. With the optimal charging current and operating schedule, a pseudo-2D electrochemical model is used to simulate the battery behavior. To reflect the actual behavior of the lithium-ion battery, two side reactions, solid electrolyte interface formation and Lithium plating, are simulated. A case study using California energy prices is presented. With the proposed framework, the results show that the battery's lifespan is extended by up to 5.1 % and overall revenue increases by up to 9.8 % compared to a singular economic optimization utilizing the standard constant current, constant voltage charging protocol. [Display omitted] •A novel, integrated, two-level optimization framework is proposed.•Economic benefits and capacity fading are considered for optimal charging.•Capacity fading reactions are implemented in the P2D electrochemical model.•The lifespan of the battery is extended by up to 5.1 %.•Overall revenue is increased by up to 9.8 %.