Compressed Air Energy Storage (CAES)

Wind & CAES Economic Benefits

• Firming Value – value of guaranteeing energy, ancillary services, short term capacity, commitment issues
• Transmission Value – relieve congestion
• Capacity Value – less peak load and margin reserve costs, managing grid peaks and outage mitigation
• Ramping Value – drive larger loads at greater speeds
• Economies of Scale – CAES is one of the cheapest storage technologies ($/kW) if a large facility is developed, the capital costs can be three times less than Pumped Hydro (which is one of the more cost effective storage technologies)
• Shaping Value – reduce the requirement to have other generation units online just to respond to wind variability, storing low value/off peak wind & delivering high value/peak wind (peak shaving), upgrade deferral, service reliability
• Energy Arbitrage Opportunities – Buy cheap off-peak power and sell expensive peak power and pocket the spread
• Ancillary Services Value – Avoiding the Cycling of thermal power plants
1. Ramping – drive larger loads at greater speeds
2. Balancing Energy
3. Voltage/ VAR Support (system operated in efficient manner)
4. Quick Start or Operating Reserve – less than ten minutes

• CAES is a complex energy system as opposed to simple energy systems such as batteries.  This peaking gas turbine power plant produces the same amount of electric power with less than 40 percent of the gas used in conventional gas turbines. CAES is able to do this because it pre-compresses air using low cost electricity (off-peak power).  Conventional gas turbines can consume up to 67 percent of their input fuel.  Compressed Air is stored in underground caverns.  It can take anywhere from a year and half to two years to create the cavern by drilling into salt and then dissolving it.  
  

• Operating CAES Facilities:
  The first commercial CAES facility was a 290 MW unit built in Huntorf, Germany in 1978. The second commercial CAES facility was a 110 MW unit built in McIntosh, Alabama in 1991. The construction took 30 months and cost $65 million (about $591/kW). This unit comes on line within 14 minutes.