| dc.description.abstract | Sustainable operations play a more prominent role in businesses today than before, and the focus on economic profits must share the attention with environmental and social sustainability. As a part of Sustainable Operations Management (SOM), this thesis is a study of the possibility of using locally generated energy in energy-intensive industries, especially the battery industry, to reduce power peaks. This can benefit both battery manufacturers and the grid balance. To do this, a study of the economic viability has been carried out using solar energy, electrolysis, and hydrogen fuel cells to reduce a 2 MW power peak in the battery manufacturing process for Morrow Batteries.
The study’s findings are that it is not economically viable to invest in neither the solutions using photovoltaic (PV) and battery energy storage system (BESS) nor the solutions using photovoltaic (PV), water electrolysis, purchased hydrogen, and PEM fuel cells to reduce the power peaks to lower the electricity tariff. The solutions’ net present value (NPV) varies between minus 15.16 MNOK and minus 219.33 MNOK. The results are negative for both 2 000 m2 and 18 000 m2 covered in photovoltaic modules.
By analyzing the results, three factors have been identified as contributing especially negatively. These factors are high investment costs, low savings on the electricity tariffs, and low energy generation from PVs. The investment costs make up between 28- 67% of the total life cycle costs. This is due to the high prices of batteries (79-81% of investment costs) and fuel cells (63-89% of investment costs). The electricity tariffs are too low to generate a significant saving by reducing the peak power load. The total NPV savings are between 17-19% of the total NPV costs. The solar conditions in Norway limit the energy production during the winter months when the power charge of the electricity tariffs is most expensive.
As the investments are not economically viable, this study recommends awaiting investments in renewable energy systems with the sole purpose of peak load shaving. Several predictions point to a reduction in batteries, fuel cells, and hydrogen gas prices by 2030 and 2050. Estimates predict a reduction in investment costs on the different solutions ranging from 2.45 MNOK to 57.18 MNOK by 2030. The development should be monitored, and a new life cycle costing (LCC) analysis should be conducted when significant developments are made.
During the study, an insight gained is that it is profitable to invest in PV without BESS for electricity generation instead of relying solely on the grid. However, this will not affect the peak power significantly. | |