{"id":34873,"date":"2020-04-01T12:03:37","date_gmt":"2020-04-01T12:03:37","guid":{"rendered":"https:\/\/jums.academy\/l-erhard\/"},"modified":"2022-10-17T14:47:45","modified_gmt":"2022-10-17T14:47:45","slug":"l-erhard","status":"publish","type":"page","link":"https:\/\/jums.academy\/en\/l-erhard\/","title":{"rendered":"L. Erhard"},"content":{"rendered":"

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Junior Management Science, Volume 3, Issue 3, September 2018, 74-105<\/p>\n

The Effects of Battery Storage on Risk and Cost of Capital of Wind Park Investments<\/strong><\/h4>\n

Lukas Erhard, Technische Universit\u00e4t M\u00fcnchen (Masterarbeit)<\/strong><\/p>\n<\/div>

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Abstract
\n<\/strong>To reach the defined reduction goals for green house gas emissions, an increasing share of renewables and especially wind power is necessary. However, these generation technologies are intermittent and progressively exposed to market risks as a consequence of declining financial support in the future. To reduce revenue volatility, in this thesis, a wind farm is combined with a battery storage. The study emphasizes the battery\u2019s effect on the investment risk and the accompanying cost of capital. In order to assess this effect, I develop a deterministic optimization model based on historic wind farm and market price data in order to maximize cash flows. Monte Carlo scenarios are generated to evaluate the impact on risk by using the Value-at-Risk as risk criterion. I find that batteries can indeed reduce revenue risk in a case without subsidies. Furthermore, the link to cost of capital is made. The latter, as well as the battery prices, need to be reduced by a certain amount to make the application of a battery economically reasonable.<\/p>\n<\/div>

Keywords:\u00a0Renewable energy, Energy markets, Battery storage, Wind investment, Energy investment risk<\/em><\/p>\n<\/div>

DOI:\u00a0https:\/\/dx.doi.org\/10.5282\/jums\/v3i3pp74-105<\/a><\/em><\/p>\n<\/div>

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