arXiv · 2503.10900
Degradation-Aware Lifecycle Planning of Microgrids with Second-Life Batteries through Reliability-Guided Refinement
Abstract
Second-life batteries (SLBs) can reduce storage investment in microgrids, but their lower initial state of health and round-trip efficiency (RTE) can make degradation-naive sizing unreliable over long horizons. This paper develops DAVIR-MG, a degradation-aware validation and investment refinement framework for microgrid planning. A 20-year mixed-integer linear planning model determines installed capacities of dispatchable generation (DG), photovoltaic (PV) generation, and a battery energy storage system (BESS) using 365 days of hourly data. The portfolio is assessed through sequential lifecycle validation that accounts for PV degradation, battery capacity fade, RTE decline, and replacement. When validation identifies degradation-induced energy not served (ENS) above the prescribed tolerance, technology-specific refinement options are evaluated and compared using validated lifecycle cost. The framework is evaluated across tariff structures, PV degradation rates, new-BESS and SLB cases, degradation-mechanism ablation, technology-specific reliability refinements, Cost-ENS trade-offs, and SLB break-even conditions. Across seven cases, validated net present cost (NPC) exceeded planning NPC by 3.0%-11.6%, while adequacy shortfalls emerged only after year 13. In the selected SLB case, capacity fade alone accounted for 76.4% of cumulative ENS, RTE decline alone for 10.7%, and their interaction for the remaining 12.9%. BESS and DG refinements restored adequacy at nearly identical lifecycle cost but through different technical pathways. Under equal-reliability sizing, the minimum SLB discount required for cost parity increased from 22.9% to 35.7% when future replacement was priced at the new-BESS cost. DAVIR-MG provides a practical, industry-relevant, and computationally manageable framework for identifying degradation-induced adequacy risks and supporting informed lifecycle investment decisions.
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Hassan Zahid Butt, Xingpeng Li. 2025-03-13. Degradation-Aware Lifecycle Planning of Microgrids with Second-Life Batteries through Reliability-Guided Refinement. https://arxiv.org/abs/2503.10900
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