modelling of Investments in energy storage capacity

[MOfelia]

Hello!

I'm new to energy modelling, and I was reading some MESSAGEix documentation to learn, but I have some questions. I'd like to know how you model investments in energy storage capacity. What is the basis for the decision to invest more or less in storage? Do you only consider the initial investment costs (CAPEX) or also the OPEX? Any help you can give me would be appreciated.

Thank you very much in advance

[glatterf42]

Hi @MOfelia, thanks for raising these questions!
While I don't have a lot of experience with modelling myself, here's what I can gather from our documentation (thanks for checking there first!):

In the storage section, it says

Storage solutions are modeled as “technologies”

So I assume that storage technologies are treated the same as every other technology: you can set their input and output, you can constrain their activity (ACT), you can constrain their capacity (CAP), etc.
Their CAP is probably what you are after, if I understand your question correctly. A model choosing to invest to in storage would mean that it builds more CAP for the storage technology and then uses that afterwards.
These decisions are determined through various parameters. Most notably, technologies each have different costs associated with them, such as

• inv_cost: investment costs (per unit of new capacity)
• fix_cost: fixed costs per year (per unit of capacity maintained)
• var_cost: variable costs of operation (per unit of capacity maintained)
• levelized_cost: levelized costs (per unit of new capacity)

(Though of course, other parameters such as reliability_factor, construction_time, or emission_factor, to name just a few, also factor in here. Also note that you can force the model to build more CAP or use more ACT through various constraints and bounds.)

Tip

So assuming that "OPEX" means "operating expenditures" (or something similar), fix_cost and var_cost should have you covered. By setting them correctly, the model will be encouraged to invest more or less in storage.

If you haven't already, I can highly recommend going through our tutorials, starting with the Westeros Baseline, which also explains these connections.
Please also note that we have recently developed a module for "costs" in message-ix-models. This may help you with more involved modelling needs.

Please let us know if this answered your question! If not (or if I made a mistake above), let's also check with @behnam-zakeri, who originally wrote the storage formulation :)