8. Storage technologies#

Three electricity storage technologies are made available to the model, all lithium-ion:

Utility scale batteries (2 hour)
Utility scale batteries (8 hour)
Distributed residential batteries (2 hour)

8.1. Overview#

Storage technologies in TIMES-NZ allow the model to draw additional power in some time slices and discharge in others, limited by the installed storage capacity.

In TIMES, batteries operate according to the model’s defined time slices. For TIMES-NZ, each day is split into three slices: Day, Night, and Peak, with Peak representing the highest demand hour of the day. Batteries can charge in one or more time slices, and discharge in one or more time slices, but cannot charge and discharge in the same time slice. Further, they cannot transfer energy between days, or between seasons.

The hour settings represent the ratio between the discharge capacity and available storage. For example, a 2-hour 1MW battery would include 2MWh of storage. If we assume batteries fully charge overnight and discharge during peak, this means they spend the entire peak hour discharging and then have some leftover storage to discharge during the day. The 8-hour battery is more expensive for peak load capacity but more effective during the day. The optimal system choice of battery within the model will depends on storage costs, capacity costs, supply and demand during each period of the day, etc.

8.2. Key assumptions#

For each of these technologies, we assume a 20-year technical lifespan, and 85% round-trip efficiency. We further assume a 98% peak contribution factor. The model can choose to install battery capacity if the ability to shift generation across time slices is worth the associated costs and inefficiencies. Cost assumptions are listed in Table 92. For ease of comparison with other references, capital costs are expressed in terms of both NZD/kW and NZD/kWh. To be clear, only a single capital cost applies.

Table 92 Battery cost assumptions for Steady scenario.#
Battery type	Variable	2023	2030	2040	2050
Utility-scale (2 hour)	Capital costs ($NZD/kW)	1581.6	962.8	731.3	692.3
	Capital costs ($NZD/kWh)	790.8	481.4	365.6	346.2
	Fixed OM ($NZD/kW)	15.8	15.8	15.8	15.8
Utility-scale (8 hour)	Capital costs ($NZD/kW)	4491.6	2527	1860.7	1748.2
	Capital costs ($NZD/kWh)	561.4	315.9	232.6	218.5
	Fixed OM ($NZD/kW)	44.9	44.9	44.9	44.9
Distributed (2 hour)	Capital costs ($NZD/kW)	3163.1	1925.6	1462.6	1384.7
	Capital costs ($NZD/kWh)	1581.6	962.8	731.3	692.3
	Fixed OM ($NZD/kW)	31.6	31.6	31.6	31.6

8.2.1. Utility-scale capital costs#

Capital cost projections for utility scale batteries are taken from CSRIO GenCost projections , converted to 2023 NZD by an exchange rate assumption of 0.924 AUD/NZD . We use the “Current policies” CSIRO prices for our Steady scenario, and “Global NZE by 2050” for Shift, leading to costs falling faster.

8.2.2. Distributed residential capital costs#

Residential battery costs projections are not available in CSIRO data. We assume that distributed batteries are two times the cost of utility-scale batteries. This gives an estimated 2023 cost of 3,163 NZD/kW. Applying the CSIRO cost curve to this price gives 2025 prices of 2,579 NZD/kW, which is in line with currently advertised prices for home battery units, including installation.

8.2.3. Fixed maintenance costs#

Some maintenance costs are required to ensure that batteries maintain their operational capacity throughout the 15-year lifespan. We assume 1% of current capital costs are required in maintenance annually. This is on the lower end of possible fixed maintenance cost assumptions , as we do not assume capacity augmentation, but only simple maintenance covering repairs and servicing. We assume these maintenance costs remain fixed even as the technology costs improve over time.

8.3. Existing investment#

While the model is able to invest in new battery construction as appropriate, we also include known investment in grid-scale batteries that are either currently operational or under construction. The batteries included are listed in Table 93.

Table 93 Existing or under construction grid-scale battery projects.#
Name	Region	Capacity (MW)	Installation Date
Rotohiko[1]	Waikato	35	2023
Ruakākā[2]	Northland	100	2024
Glenbrook-Ohurua[3]	Auckland	100	2026
Huntly[4]	Waikato	100	2027
Glenbrook 2.0[5]	Auckland	200	2028

While further battery projects have been signalled or consented, these are not listed here nor currently explicitly modelled in TIMES-NZ. All of these are treated as 2-hour ratio batteries, meaning they are modelled with 2 MWh of storage capacity for each MW of output capacity.