Economic Analysis of Wind and CAES Hybrid System Using Biomass Based Energy Storage Ailin Asadinejad * , Mostafa G. Varzaneh * , Saeed Mohajeryami † , Mehrdad Abedi ‡ * University of Tennessee Email: aasadine@utk.edu † University of North Carolina ‡ Amirkabir University Abstract—Intermittent output of renewable resources is the main obstacle in front of higher penetration of them. A hy- brid system of sustainable resource and energy storage is an appropriate solution to compensate periodic power output of a stand-alone system. In this paper a system consists of wind turbine generator with compress air energy storage (CAES) is studied. The CAES system generally needs a combustion tank and natural gas as a fuel that could cause some problems like instability at fuel cost, environmental pollution and so on. In this study, using biogas instead of natural gas is proposed to decrease disadvantage of using fossil fuels. Rather than other complicate gasifier technology, the traditional method of digestion is proposed that has more economic and environmental justification to use especially in rural areas. The proposed method has high technical and economic potentials to implement in most central villages in Iran. Index Terms—biomass energy, storage system, wind genera- tion, economic analysis, renewable energy in Iran NOMENCLATURE V CH4 mass of methane ( kg / day) α gasification coefficient ξ efficiency of wastage usage Q rate of gas flow ( m 3 / day) S 0 density of material ( kg / m 3 ) P x net mass production ( kg / day) C W cost of wind power generation C G cost of biogas production C l land cost C f fuel cost C d digester cost P wind wind power generation P CAES CAES power generation P compress compress air required power γ volume of required gas for CAES β required compress air for CAES I. I NTRODUCTION The growth of electricity demand on one side and harmful consequence of using fossil fuel production as the traditional supplier on the other side brings so many challenges to the energy production area. Some researchers are focusing on demand side control to keep the balance of load and supply without increasing fossil fuel production [1], [2], [3], [4]. However, almost everyone believes the large-scale deployment of renewable generation is generally seen as the most promis- ing option for displacing fossil fuel generators. Individually, wind power brings considerable profit to the energy mix, permitting clean and abundant cheap energy to supply the electricity demand [6], [5]. However, with the rapid growth of wind energy development, it will be a big challenge to operate the power system with high wind power penetration securely and reliably due to the implicit variability and uncertainty of wind power [7], [8]. Energy storage is an efficient strategy to manage this uncertainty; it allows both power generators and consumers to have better control of how and when they make and use electricity [9], [10]. With the flexible charging–discharging characteristics, energy storage system is considered as an effective tool to improve the flexibility and controllability not only of a specific wind farm but also of the entire grid [29]. In this paper, a combination of a wind turbine with CAES system is proposed to supply electrical energy. CAES systems are basically comparable to pumped-hydro power plants in terms of their applications, output, and storage capacity. Although, instead of pumping water from a lower to an upper basin during periods of excess power, in a CAES plant, ambient air is compressed and stored under pressure in an underground cavern [12]. In the non-mountainous regions of Iran, which contain the large percentage of the nation’s low- cost wind resources, flat terrain, and lack of water, CAES is more suitable for wind energy storage projects. A. Description of the hybrid wind / CAES The basic components of the proposed hybrid system are a wind turbine, large-scale energy storage system, microgrid or essential transmission lines. A microgrid is a group of interconnected loads and distributed energy resources within clearly defined electrical boundaries that acts as a single controllable entity with respect to the grid [13]. A microgrid can connect and disconnect from the grid to enable it to operate in both grid-connected or island-mode [14], [15]. CAES is a hybrid of storage / generation technology that could quickly respond to variation of wind turbine generation to meet the demand. CAES utilize the elastic potential energy of compressed air to run a conventional gas turbine. Energy is stored by compressing air in an airtight underground storage cavern. To extract the stored energy, compressed air is drawn