Technologies: Fractal Modelling
Right-Sizing Storage: Optimal for What?
A storage model will optimize whatever objective you give it, even an incomplete one. Highest IRR, total cash flow, curtailment recovery, contract firmness and market optionality each point to a different battery. Right-sizing starts when the owner decides what success means.
Solas Energy uses fractal modelling to run your project through many dispatchable cases across price curves, renewable profiles, charging options and market configurations. You see where the next megawatt-hour stops earning its place, and which assumption would change the answer.
We have modelled multiple storage assets across North America, each against different price curves, to see how the battery works with solar and where it makes money. Few firms can say they have modelled at that volume.
Three Ways a Right-Sizing Review Can Land
Every review ends with a clear recommendation. Sometimes the strongest answer is a smaller battery, or a later one.
- Smaller nowCapture the strongest value with a system sized to the objective you ranked first.
- Stage for laterBuild what pays today and protect the interconnection, metering and space to expand.
- Not yetSet the price, policy and cost triggers that would justify looking again.
Five Objectives, Five Different Batteries
- Highest project IRR
Smaller and harder working. - Highest total cash flow
Larger, until marginal value fades. - Curtailment recovery
Size MW and MWh to the spill shape. - Contract firmness
Match duration to the obligation. - Market optionality
Protect metering, charging and control rights.
A battery can be technically feasible and still be economically mis-sized. A 2-hour, 4-hour or 8-hour label says very little until it meets your production profile, interconnection limit, charging source, market access and degradation assumptions.
More Duration Can Add Revenue and Still Reduce Value
In an anonymised wind plus storage case, moving from a 2-hour to a 4-hour battery lifted modelled annual revenue 38%. The project return fell 55%. The extra duration captured more revenue, and the added capital worked far less efficiently.
The larger battery optimized a different objective. That is why every recommendation we make shows the absolute dollars, the percentage return, utilization, capital at risk and the sensitivity that could reverse the result.
Smaller system
Higher return, more utilization, less capital at risk.
Larger system
More energy captured, more cash flow, lower marginal return.
Percentage return, or dollars captured? The owner decides. We make the trade-off visible.
Revenue Up 38%. Return Down 55%.
Anonymised wind plus storage case (2-hour battery = 100)
Five Questions to Answer Before You Size a Battery
What problem must the battery solve?
Be precise about the owner’s objective, and rank the jobs the battery is expected to do. That ranking prevents false precision and gives the model a clear target.
Which revenues are compatible?
Arbitrage, ancillary services, capacity and curtailment capture can compete for the same megawatt-hour, state of charge or operating interval. A dispatch model forces those choices to happen in time, so no benefit is counted twice.
What charging and dispatch rights actually exist?
Registration, metering and connection rights decide what the battery may do. The model cannot bank a right the operator cannot exercise.
What remains after costs and degradation?
Round trip losses, degradation, charging costs and operating constraints come off the top. Project value is what remains.
What would reverse the decision?
Name the assumption that would flip the result, then use it to set the monitoring triggers for revisiting the decision.
When Regulatory Bodies are Involved, Configuration Defines the Opportunity
In Alberta for example, AESO guidance distinguishes independent hybrid assets from a single hybrid asset, and each structure creates a different set of operating choices. Metering determines optionality, so we settle configuration before we size anything.
Independent assets
Distinct offers and added metering. The battery may self-charge where the connection, tariff and market rules allow it, which keeps operating choices clearer.
Single hybrid asset
One combined offer. Paired with wind or solar, the facility may be partially controllable and subject to VERBlock and dispatch obligations, with a tighter operating boundary.
The guidance predates current REM implementation, so we confirm the live ISO rules, tariff treatment and AESO direction on every project, and treat uncertain revenue as a sensitivity outside the base case.
1 GW of BESS and Hybrid Projects Modelled
How Right-Sizing Works
Fractal modelling is iterative. Each dispatchable case changes one condition, so every run teaches the next and the recommendation arrives as a decision range with clear trade-offs.
- Renewable-only baselineProduction, curtailment, price exposure, interconnection limits and contract obligations.
- Define the owner’s objectiveRank what success means before anything is optimized.
- Add a credible BESS caseOne dispatchable case with realistic charging, losses and degradation.
- Test MW, MWh, charging and dispatchRevenue streams compete inside the dispatch, where they really interact.
- Refine until value diminishesStop where the next unit misses the hurdle rate, then test that boundary.
Run cases. Learn from each. Triangulate the sweet spot.
The Storage Modelling Package
Fractal modelling leads. Each module adds what your project needs next, from hybrid design to contracts and operations, so the battery you finance is the battery you run.
- Fractal Modelling of Revenue and DispatchMany dispatchable cases across price curves, renewable profiles and market rules.
- Hybrid Modelling with Solar or WindHow the battery and the generator share the interconnection and the revenue.
- Tolling and Offtake StructuresContract terms that match the dispatch the battery can deliver, including firmness.
- EMS AlignmentAn energy management strategy that follows the case you financed.
- Augmentation PlanningWhen to add capacity as the battery degrades, and the triggers that justify it.
- Round Trip Efficiency and Operations ReviewWhat the operating battery returns, measured against the model.
Who We Help
- Developers adding storage to solar or wind“Will the hybrid pay back, and which dispatch strategy can we bank on?”
- Commercial and industrial owners in developing markets “Can a battery behind the fence cut our coincident peak charges?”
- Lenders and investment committees“Is the revenue case realistic, and what is the downside if it is not?”
Remote/Off-Grid Hybrid Feasibility
Solas Energy evaluated wind, storage, diesel, and grid options for an off-grid project. Our modelling identified cost-effective pathways, balancing ESG goals with reliability and capital cost.
Energy Storage & Carbon Offsets
Solas Energy developed a first-of-its kind framework to quantify the GHG reduction potential of energy storage. The study informed policy, identified barriers, and positioned storage as a key enabler for renewable integration.
Book a 30-Minute Storage Review
Bring your project and your objective. In 30 minutes we will tell you which of the five questions matter most for your battery, and what it would take to answer them.
Shasta Kadonaga, Vice President, Renewable Energy
skadonaga@solasenergy.com · 403.454.9463
Common Questions About Storage Modelling
It tests a battery across many dispatchable cases at once, varying prices, renewable profiles, charging options and market rules, to find where the next unit of capacity still earns its place against the owner’s objective.
No single ratio holds. The right size depends on the owner’s objective, the renewable production profile, the interconnection limit, the charging source, market access and degradation. That is why we model it.
An executive summary with a recommended decision range, a scenario workbook with IRR, NPV, payback, revenue by stack and key sensitivities, and a technical appendix covering sizing, augmentation, degradation, round trip efficiency and interconnection limits. Every recommendation shows dollars, return, utilization, capital at risk and the sensitivity that could reverse it.
Typically 4 to 6 weeks once the project data is in hand. Add-on modules such as hybrid modelling, tolling structures or augmentation planning are scoped separately.
Developers adding storage to solar or wind, commercial and industrial owners managing peak charges, and lenders or investment committees testing a revenue case.
Yes. A disciplined study allows three outcomes: a smaller battery now, a staged build that preserves the expansion option, or no battery yet. When the answer is not yet, we define the triggers for looking again, such as a capex threshold, a new market product, a contract opportunity, a congestion level or a tariff change.
We work across Canadian and US markets, including the AESO in Alberta, the IESO in Ontario and CAISO in California, with projects in all ten provinces since 2009.
Solas Energy is independent and vendor-neutral, so the recommendation follows your objective and your market.
We offer consulting support across a breadth of developing & emerging technologies.
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About Solas Energy
Solas Energy provides comprehensive strategy and consulting services to support the energy transition. With multiple decades of experience in project development, construction management, and climate change advisory, Solas Energy provides its clients with the depth and perspective required to navigate the complex issues associated with renewable energy project development and climate change policy.
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