Defining degradation

Degradation is a broad term used to describe the gradual performance losses that a battery experiences due to the electrochemical processes that occur through everyday use.

The most commonly discussed part of degradation is 'capacity fade' or the reduction in the ability of a battery to hold as much energy. For example, 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. For the purposes of our modeling, we will use capacity fade and degradation interchangeably.

One key consideration of asset owners is the negative impact of degradation on revenues, effectively shortening the duration of a site and reducing its ability to capture spreads. As such, 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.

Modeling degradation

Battery degradation is influenced by several factors, including cycling rates, depth of discharge, power outputs, and ambient temperature; batteries even degrade over time when not in use.

As a simplifying assumption in our modeling, we assume that the usable capacity of the battery storage system decreases only as a function of a site's total number of cycles. The graphic below illustrates the relationship between cycling and remaining usable capacity. For example, 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.

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 over the duration 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 10k cycles.