Feasibility of residential battery storage for energy arbitrage

This paper presents the methodology, results and analysis of the feasibility of residential battery storage for energy arbitrage in the context of the Australian retail electricity market. The economic feasibility of a residential battery storage system was determined by its ability to achieve residential cost savings from undertaking energy arbitrage, which is: the implementation of a battery system to buy, store and discharge electrical energy to take advantage of fluctuating electricity prices. Integral to this simulation was the incorporation of the stochasticity of a household´s hourly electricity demand, which is largely determined by consumer behaviour. A Monte Carlo method was used whereby this random household behaviour was simulated with sets of probabilistic household demand. This then allowed accurate and precise statistical inference of the feasibility of various battery storage system configurations. Overall, many of the storage system configurations examined showed high probabilities of being economically feasible within current economic and technical contexts.