Application of the Cost of Valued Energy (COVE) to a RES-based Hybrid Energy System on a Mediterranean Island to Evaluate the Potential of Energy Storage Systems

Due to geographical constraints, the energy supply of communities living on small Mediterranean islands has always been an issue. Renewables potentially represent a game changer, but the power production from wind turbines and solar panels is heavily dependent on weather conditions, making the match between electrical production and demand much more challenging than that with traditional energy production means. Energy storage systems, such as batteries or power-to-gas, may increase the dispatchability of renewable energy and make it suitable also for small island applications. In correctly designing hybrid energy systems (HES) with storage, a simple yet effective parameter able to account for this additional flexibility is needed. Differently from the Levelized Cost of Energy (LCOE), the Cost of Valued Energy (COVE) weights the energy produced with the normalized market value at the time of production. In this work, LCOE and COVE are compared by applying them to the HES installed on the Greek island of Tilos, which is characterized by a high share of time-varying renewable power. The techno-economic benefits of introducing an energy storage system of different sizes are evaluated by means of the two metrics.