Degradation is defined as the decreasing capacity of a battery's ability to store energy over time

Over time, a battery will be able to hold less energy. A site that originally could hold up to 100 MWh of energy may only have 80 MWh of usable energy storage capacity left after being used for several years, or 80% of its nameplate capacity. It has degraded through use.

Asset owners should model the impact of degradation on revenues. It shortens the duration of a site over time, reducing its capacity for storing energy - so the site can capture fewer spreads.

Repowering is often discussed in the later years of operation, that is, replacing the degraded cells and increasing usable capacity back to the nameplate capacity.

Defining a battery cycle

1 cycle is the energy discharged by a battery equivalent to its nameplate (or starting) capacity

A battery cycles once when it discharges the same amount of energy as its nameplate capacity. The throughput - or cumulative discharge - of a site is often quoted in cycles. It can be a measure of its age, and historic usage.

Degradation is modeled in terms of cycles - ie how much capacity will remain after 10,000 cycles, for example. For a 100MWh nameplate-capacity site, this would be equivalent to the battery having discharged 10,000 * 100 MWh = 1 million MWh or 1TWh during its lifetime.

A cycle in year 10 is the same energy throughput (ie energy discharge) as year 1 - and is set by the nameplate capacity, or starting capacity. This is how most battery warranties are defined.

Modeling degradation

A lithium-ion battery 'degrades' due to the electrochemical processes from use. High temperatures, low temperatures, spending periods at low state-of-charge, high state-of-charge, significant depth of discharges, cell chemistry, balance of plant, etc, etc... all these and more contribute to a battery being 'less useful'.

In our forecast, we assume that the usable capacity of the battery storage system decreases as a function of a site's total number of cycles. The graphic below illustrates the relationship between cycling and remaining usable capacity.

Here, if a system has a nameplate capacity of 100MWh on commissioning, we expect the site to have only ~60% (or 60MWh) of usable capacity after 8000 cycles.

In years, if the site is doing 2 cycles per day, it will degrade with age like the below (though this will depend on strategy and location).

Toggling degradation

Users have the option to view results with and without degradation. In the case of no degradation, it is assumed that usable capacity remains constant throughout the time horizon of the forecast. This is most useful for understanding a generic view of the future without a specific start date in mind.

Alternatively, runs with degradation turned on are best handled using a custom run to allow users to specify two key parameters:

• Start date - This variable denotes the first date of operation of the site and, in the context of degradation, the point in time we assume no degradation/100% usable capacity.
• Repowering - Determines when the site is repowered, that is, when the usable capacity returns to nameplate capacity. Repowering inputs are measured in terms of cycle count. See example below for repowering set to 8,000 cycles. This would be after 12 years if the battery was doing 2 cycles per day.