Storage investment model

Cornwall Insight Australia’s ‘Storage investment model’ (SIM) is designed to inform and assist market participants on storage investments, enabling project optimisation, risk assessment, independent evaluation and due diligence.

The ‘Storage investment model’ (SIM) is an optimisation model that utilises granular market price forecasting data from our industry recognised and widely adopted modelling tools:

• ‘Benchmark Power Curve’ price forecast and ‘FCAS price curves’ which forecasts all eight FCAS markets

The SIM calculates 20-year storage revenues in all nine markets (eight FCAS markets and the energy market) based on project specifications and the selected operational strategy.

The service overview

Our SIM service provides you with either once off or regularly revised revenue forecasts tailored to your project.

Active value add
The SIM report includes an explanation of the physical and market assumptions, storage costs and revenues, optimised trades as well as policy and regulatory matters.

Cornwall Insight Australia’s team of storage experts engage with clients to present findings, review analysis and discuss recommendations to ensure outcomes from the model results are actionable and impactful.

Ease of integration
The SIM revenue data is calculated down to each granular settlement interval. For ease of analysis and review, we aggregate data to weekly, monthly, quarterly or annually as required. Revenues are split out for each of the nine markets (eight FCAS markets and the energy market) in a clear excel spreadsheet. Other data outputs include trading day snap shots and throughput curves.

Operations and due diligence
SIM provides a valuable tool to regularly evaluate performance, warranties and review bidding protocols through modelling the optimal storage revenues, costs and throughput.

Key benefits

• The SIM report provides storage revenue analysis and risk assessments which can be used to acquire and satisfy external or internal equity and debt funding approval requirements. Undertaking regular reviews of storage investments using the latest ‘Benchmark power curve’ and ‘FCAS price curves’ will assist in identifying and understanding emerging risks and opportunities.
• SIM can use NEM price backcasting across all nine markets to calculate the ideal revenue based on
  your asset’s technical specifications. This allows
  your business to benchmark trading performance, monitor warranty conditions and evaluate expansion or repowering opportunities. Perfect exercise to map and outline how to optimally operate your plant.
• This service provides your business with a forecast of costs and revenues which can be used for budgeting, reporting and retail risk management purposes. SIM also allows traders and operators to develop, evaluate and asses alternative future trading, operation and investment strategies.

Who is it for?

• Lenders
• Investors
• Developers
• Generators
• Operators
• Traders
• Retailers
• Government
• Regulatory bodies