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Assessment of Battery Storage IPP/PPP Schemes for the Pacific Utilities

The Pacific Power Association, in consultation with The World Bank, has identified the need to assess the battery storage deployment options with mobilizing private sector funding to improve the utilization of Variable Renewable Energy (VRE) sector in the region. Special emphasis has been put on assessing battery storage implementations under a Public-Private Partnership (PPP) scheme. This report has been developed as a part of the "Assessment of Variable Renewable Energy (VRE) Grid Integration and Evaluation of SCADA and EMS system design in the Pacific Island Counties" project.

The first section of the report provides a general overview of the PPP arrangements with a special focus on the Independent Power Producer (IPP) structure provided that this structure might be relevant for the commercial design of potential stand-alone battery storage implementations in the region. This section also provides an overview of the market and successful implementations of such schemes covering the most advanced markets such as the United States, Germany, Japan, United Kingdom and Australia. In addition, some applications by island nations have been also identified and assessed.

The second part of the report provides a qualitative assessment of setting up stand-alone battery storage projects under a PPP structure. The assessment is backed by the pros and cons for such an arrangement.

The third section of the report presents the methodology which has been used to assess a stand-alone battery storage project in the region. This covers the description of the working of the financial model, the main assumptions used and the outputs and main results. Two main options have been compared: PPP arrangement vs. public procurement. In addition, several different scenarios have been also analyzed.

The fourth section of the report describes some high-level technical and commercial recommendation to be considered for a stand-alone battery storage procurement in the region. This is based on the analysis of actual procurements in other regions and recent developments of commercial terms in the advanced markets.

 

Citation

Fischer, Sandra; Antosik, Mate; Chown, Graeme.2019. Assessment of Battery Storage IPP-PPP Schemes for the Pacific Utilities (English). Energy Sector Management Assistance Program (ESMAP) Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/520721590988512847/Assessment-of-Battery-Storage-IPP-PPP-Schemes-for-the-Pacific-Utilities

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