  In an isolated power grid or a micro-grid with a small carbon footprint, the
penetration of renewable energy is usually high. In such power grids, energy
storage is important to guarantee an uninterrupted and stable power supply for
end users. Different types of energy storage have different characteristics,
including their round-trip efficiency, power and energy rating, energy loss
over time, and investment and maintenance costs. In addition, the load
characteristics and availability of different types of renewable energy sources
vary in different geographic regions and at different times of year. Therefore
joint capacity optimization for multiple types of energy storage and generation
is important when designing this type of power systems. In this paper, we
formulate a cost minimization problem for storage and generation planning,
considering both the initial investment cost and operational/maintenance cost,
and propose a distributed optimization framework to overcome the difficulty
brought about by the large size of the optimization problem. The results will
help in making decisions on energy storage and generation capacity planning in
future decentralized power grids with high renewable penetrations.
