Winning Approaches to Valuation and Operations of Battery Storage Projects

November 4-5, 2020 | Online ::

1120-storage-valuation

The growth of renewable generation around the country is creating structural change in electricity markets, driving dramatic increases in volatility in both day-ahead and real-time energy markets.   Battery storage, given its fast ramping capability, offers a unique opportunity for taking advantage of these changing market dynamics. The energy landscape is constantly changing as well as ancillary prices across ISOs, so it is more important than ever knowing how to optimize battery storage across potential revenue streams to develop successful storage projects. 

This course is designed to provide expert insight on the rapid expansion of renewables and battery storage, offering strategies for resource planning, portfolio management, and operations. Practical case studies of valuation and optimal siting of potential stand-alone storage projects and storage paired with renewables will be used. By focusing on the new fundamentals of supply, this interactive course illuminates critical pathways to improve decision analytics on the most pressing challenges facing the energy industry.

Learning Outcomes

• Review the keys to profitable battery projects
• Discuss how energy and ancillary prices are evolving in response to higher levels of renewable penetration
• Identify where to site potential storage projects to maximize potential market revenue
• Evaluation of storage projects over historical and forecasted market prices optimally stacking value streams
• Review optimal sizing and operation of battery storage systems paired with renewables to capture market revenue and provide capacity
• Examine batteries as a physical hedge for renewable portfolios
• Discuss the efficient allocation of capital to improve reliability and achieve environmental objectives
• Identify sizing and detailed valuation of potential battery projects and battery and storage projects

Credits

EUCI is accredited by the International Accreditors for Continuing Education and Training (IACET) and offers IACET CEUs for its learning events that comply with the ANSI/IACET Continuing Education and Training Standard. IACET is recognized internationally as a standard development organization and accrediting body that promotes quality of continuing education and training.

EUCI is authorized by IACET to offer 0.9 CEUs for this event.

 

Requirements For Successful Completion Of Program

Participants must sign in/out each day and be in attendance for the entirety of the course to be eligible for continuing education credit.

Instructional Methods

A PowerPoint presentation with case studies will be used in this online program through Microsoft Teams.

Wednesday, November 4, 2020  Central Time

Course Timing: 9:15 a.m. – 4:30 p.m.

9:00 – 9:15 a.m. :: Log In

9:15 – 9:30 a.m. :: Overview and Introductions

9:30 – 10:30 a.m. :: New Market Dynamics

• Changing Market Fundamentals

Using fundamentals to capture new market price dynamics

• • Impact of policy and macro condition assumptions
  • Impact of renewables on power prices and volatility
  • Future supply and energy sources
  • Day-ahead (DA) and Real-time (RT) price response to changing fundamentals
  • Structural drivers of market price volatility and real-time price spikes
  • Long-run cost of power and impact of technology
  • Congestion persistence, basis evolution, and transmission limits

10:30 – 10:45 am :: Morning Break

10:45 –11:30 a.m. :: Forecasting Future Market Conditions

• Forecasting prices, shapes, volatility, and achieving long-run equilibrium
• New unit entry and exit and the value of looking sub-hourly
• Renewable curtailments and impacts on market prices
• Hourly and sub-hourly ramps and proposed capacity reserve imbalance markets
• Future of ancillary service markets and the opportunity cost of participation vs real-time energy
• Sub-hourly price dynamics
• DART Spreads

11:30 a.m. –12:00 p.m. :: Project Siting

• Key metrics for battery project profitability
• High-level methodology of maps
• Heat maps for a sample ISO
• Discussion of areas of interest for siting storage
• Basis risk in battery and renewables and battery projects

12:00 – 12:45 p.m. :: Lunch Break

12:45 – 1:45 p.m. :: Stacking of Revenue Streams

• Energy and Ancillary Services
• Capacity and Limits on Energy
• Battery and Renewable System Physical Attributes
• Optimization of Storage Operations
  • Naïve Strategies
  • Imperfect Foresight
  • Perfect Foresight
• Putting It All Together

1:45 – 2:00 p.m. :: Afternoon Break

2:00 – 3:00 p.m. :: Day Ahead and Real-time Spreads

• Asset Backed Virtual or Convergence Trades
• Strategies and Relative Opportunity
• Naïve Strategies versus Forecast Strategies
• Selecting markets the battery will participate in (regulation, spinning reserve, day ahead energy, real time energy)
• Review of detailed valuation outputs and dispatch reports

3:00 – 3:15 p.m. :: Afternoon Break

3:15 – 4:15 p.m. :: Hedging of Storage and Renewables Plus Storage

• Hedge Instruments to Firm of Future Cash Flows with Renewables
• Convergence in Efficient Markets vs Risk Premium of Hedging
• Principal Risk Factors of Market Price and Physical Delivery
• Basis Risk
• Shape Risk and price-volume correlations
• Rolling the Hedge Forward Strategies

4:15 – 4:30 p.m. :: Q&A and Day One Program Adjournment

Thursday, November 5, 2020 Central Time

Course Timing: 9:00 a.m. – 12:00 p.m.

8:45 – 9:00 a.m. :: Log In

9:00 – 9:45 a.m. :: Case Studies of Valuation and Operations of Stand-Alone Storage

• Measuring project return relative to risk
• Co-optimization of energy and ancillaries
• Robust stochastic sub-hourly modeling and residual risk
• Visualization tools for decision-support

9:45 – 9:55 a.m. :: Morning Break

9:55 – 10:55 a.m. :: Case Studies of Valuation and Operations of Solar Plus Storage with and without Investment Tax Credits (ITC)

• Measuring project return relative to risk
• Problems with valuations run in deterministic models with high / low scenarios, and average price shapes.
• Using storage to shift solar to peak load hours
• How battery plus solar system dispatched to sub-hourly RT prices with hedging leads to much less forward price risk
• Quantifying and understanding basis, shape and intermittency risk

10:55 – 11:00 a.m. :: Short break

11:00 a.m. – 12:00 p.m. :: Case Studies of Valuation, Siting and Operations of Wind Plus Storage

• Measuring project return relative to risk
• Battery as a physical hedge for wind projects. Comparison with Fixed Volume Swaps and Proxy Revenue Swaps
• Making merchant work with hedging wind plus storage
• Quantifying and understanding basis, shape and intermittency risk

12:00 p.m. :: Course Adjournment

Gary Dorris, PhD, CEO & President, Ascend Analytics

Dr. Dorris has been a pioneer of innovative solutions for energy planning and risk.  For the last dozen years, Gary has introduced utilities to new solutions to model and analyze planning portfolios.  His analytic innovations and expertise are sought by industry leaders including expert testimony in some of the most prominent resource planning and risk management proceedings in the country.  His company’s software solutions are used by 3 of the top 5 utilities in America and many COOPs and municipalities.  He has established industry standards for model validation, monetization of risk, portfolio selection, and performance metrics.  In 2001, Dr. Dorris won distinguished recognition from the IPE for contributions to the field of energy risk management.  Dr. Dorris holds a Ph.D. in applied economics and finance from Cornell University and a BS in mechanical engineering and BA in economics with Magna Cum Laude distinction also from Cornell University.

Allison Weis, PhD, Director of Optimization Analytics, Ascend Analytics  

Dr. Weis directs Ascend’s battery storage team and provides technical guidance on a variety of optimization analytics products for renewable integration, flexible grid resources, and system planning. She manages valuation and real-time dispatch optimization for storage and renewable systems operating in wholesale markets.  She also leads work on hydro system optimization for clients facing different system constraints and goals and development of planning analytics for optimal resource selection across transmission connected, distribution connected, and behind-the-meter resources. She brings her understanding of flexible grid resources from her work modeling the integration of wind and solar with batteries and electric vehicle charging at Tesla, and in her PhD from Carnegie Mellon prior to joining Ascend.

Scott Wrigglesworth, Director of Analytics & Strategy, Ascend Analytics

Scott Wrigglesworth, is Director of Analytics and Strategy with Ascend Analytics where he provides clients with expertise and analytical support in areas of energy portfolio management. Before joining the company, he spent 17 years with Dayton Power and Light and the AES Corporation. There he focused on practical solutions in energy analytics, actionable reporting, margin modeling and portfolio optimization and developed managerial P&L tracking.  He also led portfolio management for retail operation and advised on a variety of business activities including segmentation, marketing analysis, and broad strategy decisions, which resulted in retail gross margin from 2012 through 2013 in excess of $100M. Scott also  worked intimately with power production staff and managers supporting the stewardship of assets though robust and sound analytics on economic value, investment opportunity and risk evaluation.

At Ascend, Scott applies his experience in commercial portfolio optimization to the Ascend Analytics team in a multifaceted role. Mr. Wrigglesworth also teaches a course in Energy Markets at the University of Dayton from where he also earned his MBA. He holds a BA in Global Economics and International Business from Cedarville University.

Carlos Blanco, PhD, Managing Director of Analytic Solutions, Ascend Analytics

Dr. Blanco provides expertise to Ascend’s clients in the areas of analytic modeling, forecasting, optimization and simulation and also contributes to advance the software product and services to meet the evolving client needs.

He is the former co-founder and managing director of Black Swan Risk Advisors where he worked with leading organizations worldwide on a wide range of advisory and education projects.  Dr. Blanco is also a faculty member of the Oxford Princeton Programme since 2004, where he teaches several courses on energy and commodity derivatives pricing, hedging and risk management.  He has published over 150 articles on a wide range of financial and commodity risk management topics. Carlos was also a lecturer at the Finance department at the University of California, Berkeley.  He is a former VP, Risk Solutions at Financial Engineering Associates (a BARRA/MSCI company), where he was a member of the Executive Management Committee as well as an essential contributor in the development and client support of the financial and energy derivatives pricing and market risk management models.

Dr. Blanco holds a Ph.D. in Finance from Universidad Complutense, Madrid, where he was awarded “Magna Cum Laude”.  He also has a Masters degree in Investments and International Economics from the University of Nebraska, Lincoln.

We will be using Microsoft Teams to facilitate your participation in the upcoming event. You do not need to have an existing Teams account in order to participate in the broadcast – the course will play in your browser and you will have the option of using a microphone to speak with the room and ask questions, or type any questions in via the chat window and our on-site representative will relay your question to the instructor.

• You will receive a meeting invitation will include a link to join the meeting.
• Separate meeting invitations will be sent for the morning and afternoon sessions of the course.
  • You will need to join the appropriate meeting at the appropriate time.
• If you are using a microphone, please ensure that it is muted until such time as you need to ask a question.
• The remote meeting connection will be open approximately 30 minutes before the start of the course. We encourage you to connect as early as possible in case you experience any unforeseen problems.

REGISTER NOW FOR THIS EVENT:

Winning Approaches to Valuation and Operations of Battery Storage Projects

November 4-5, 2020 | Online

Your registration may be transferred to a member of your organization up to 24 hours in advance of the event. Cancellations must be received on or before October 02, 2020 in order to be refunded and will be subject to a US $195.00 processing fee per registrant. No refunds will be made after this date. Cancellations received after this date will create a credit of the tuition (less processing fee) good toward any other EUCI event. This credit will be good for six months from the cancellation date. In the event of non-attendance, all registration fees will be forfeited. In case of conference cancellation, EUCIs liability is limited to refund of the event registration fee only. For more information regarding administrative policies, such as complaints and refunds, please contact our offices at 303-770-8800