Steel-Plant ESS 6 MWh — LatAm TCO Use Case
Verdict (model run, evidence date 2026-09-22, horizon 10 yr, discount rate 10.00%): NPV = −USD 1,656,462; simple payback = None; discounted payback = None; IRR = −0.1712; LCOS = USD 0.2104 / kWh. Across the modelled scenario the project does not recover capex from the modelled cash flows; the dominant value driver (demand-charge displacement) is insufficient at the modelled EAF equivalent tariff of USD 0.115/kWh and the modelled Brazilian SE/CO MV reference tariff band. Equipment: CATL 280 Ah prismatic LFP cells in a Sungrow ST3440KWH(S)-3500UD-MV PCS skid (BMS/EMS per Sungrow OEM manuals, revision confirmed at RFQ); limitation — CATL cell and Sungrow PCS product pages are JS-rendered; exact firmware revision is set at contract.
Decision table
| Metric | Value |
|---|---|
| NPV (USD) | -1,656,462.16 |
| IRR | -0.1712 |
| Simple payback (year) | — |
| Discounted payback (year) | — |
| LCOS (USD/kWh) | 0.2104 |
| Total discounted cost / PV of costs (USD) | 2,378,263.06 |
| Total discounted benefit (USD) | 721,800.90 |
| Equipment family | CATL 280 Ah prismatic LFP cells in Sungrow ST3440KWH(S)-3500UD-MV PCS skid |
| Location | LatAm integrated steel plant, MV interconnection, Brazil SE/CO reference tariff band (model assumption) |
| Horizon | 10 years |
| Evidence date | 2026-09-22 |
1. Equipment, datasheets & manuals (named, public)
| Item | Public datasheet / product page | Use here |
|---|---|---|
| Cell | CATL energy storage landing — CATL 280 Ah prismatic LFP cell (cell nameplate model confirmed at RFQ; CATL ESS product pages JS-rendered) | LFP cell chemistry, cycle life assumption basis |
| PCS skid | Sungrow Power landing — Sungrow ST3440KWH(S)-3500UD-MV (utility-scale MV-integrated PCS+BESS skid, publicly marketed family); datasheet rev confirmed at RFQ | DC round-trip efficiency η = 0.88, MV interface |
| BMS / EMS | Sungrow iSolarCloud / on skid EMS; manual title and firmware rev confirmed at RFQ | Control envelope |
| PCS safety standard | IEC Webstore — IEC 62477-1:2016+AMD1:2017 CSV edition, Power electronic converter systems — Part 1: General requirements (cite full designation IEC 62477-1:2016/AMD1:2017 CSV in text at RFQ) | Procurement spec |
| BESS safety standard | IEC Webstore — IEC 62933-2-1:2017, Safety requirements for secondary lithium cells and batteries for use in electrical energy storage systems — Part 2-1: Stationary applications (cite full designation IEC 62933-2-1:2017 in text at RFQ) | Procurement spec |
| Stationary battery standard | UL 1973 — Batteries for Use in Stationary and Motive Auxiliary Power Applications | Cell/safety qualification reference |
| Lithium-battery transport test | UN Manual of Tests and Criteria, ST/SG/AC.10/11/Rev.7 (UN 38.3) | Shipping compliance for LFP cells |
| EU Battery Regulation | Regulation (EU) 2023/1542 | If destination is EU: due-diligence, labelling, recycling |
Limitation: CATL and Sungrow product pages are JS-rendered; exact firmware / manual revision is confirmed at RFQ against the OEM datasheet and installation & operation manual revision.
2. Model inputs
| Variable | Symbol | Value | Source / status |
|---|---|---|---|
| Energy capacity | E | 6,000 kWh | Use-case specification (TradVolt) |
| Power rating | P | 12,000 kW | Use-case specification (TradVolt); bounded to Sungrow ST3440KWH(S)-3500UD-MV skid family |
| DC round-trip efficiency | η | 0.88 | Model assumption — bounded to CATL LFP cell + Sungrow PCS skid OEM datasheet band 0.86–0.90; rev confirmed at RFQ [CATL ESS landing, Sungrow landing] |
| Equivalent full cycles per year | C | 330 | Model assumption — C&I operating profile (1 cycle/day on operating days) |
| Operating days per year | D | 330 | Model assumption — 330/365 of calendar days |
| Capex per kWh (turnkey, LatAm delivered) | CX | USD 350 / kWh | Model assumption — public C&I LFP turnkey band USD 320–400 |
| Fixed O&M, % of capex per year | OM | 2.0% | Model assumption — utility-scale BESS O&M band |
| Peak demand charge (MV, USD/kW-month) | DC | USD 9.00 / kW-month | Model assumption — Brazilian SE/CO industrial MV reference band (specific ANEEL resolution number pending; see §4) |
| Off-peak grid tariff (MV, USD/kWh) | GP | USD 0.045 / kWh | Model assumption — Brazilian SE/CO industrial MV off-peak reference band |
| EAF equivalent tariff (charged to EAF if peak-imported, USD/kWh) | EP | USD 0.115 / kWh | Model assumption — Brazilian SE/CO industrial peak reference band |
| Demand charge offset, fraction of rated kW | fkW | 0.50 | Model assumption — 50% of 12 MW peak shaved |
| Discharge hours per peak-day equivalent | H | 3.0 h | Model assumption — arbitrage window length |
| Project life | Ny | 10 years | Model assumption — bounded 8–12 yr LatAm standard |
| Discount rate | r | 10.00% | Model assumption — LatAm commercial WACC band |
| Residual value amount | RV | 0 USD | Model assumption (explicit bounded default) |
| Residual value year | RVy | 10 (end of horizon) | Model assumption (explicit bounded default) |
| ESS usable fraction | u | 1.00 | Model assumption (explicit bounded default) |
| ESS degradation per year | deg | 2.0% / yr | Model assumption (explicit bounded default); throughput taper per the year-by-year table below |
3. scenario TCO tables (verbatim — do not re-derive)
TCO summary. Currency USD; horizon 10 yr; discount rate 10.00%.
| Metric | Value |
|---|---|
| Currency | USD |
| Horizon (years) | 10 |
| Discount rate | 10.00 % |
| Total undiscounted cost (USD) | 2,559,888.28 |
| Total discounted cost / PV of costs (USD) | 2,378,263.06 |
| Total undiscounted benefit (USD) | 1,156,557.18 |
| Total discounted benefit (USD) | 721,800.90 |
| NPV (USD) | -1,656,462.16 |
| IRR | -0.1712 |
| Simple payback (year) | — |
| Discounted payback (year) | — |
| LCOS (USD/kWh) | 0.2104 |
Year-by-year cash flow. Discount factor column equals 1/(1+r)y with r = 10.00%; energy column equals E × C × η × (1 − deg)y with degradation taper 2.0%/yr applied to throughput.
| Year | Cost (USD) | Benefit (USD) | Net (USD) | Discount factor | Discounted net (USD) | Energy (kWh) |
|---|---|---|---|---|---|---|
| 0 | 2,100,000.00 | 0.0000 | -2,100,000.00 | 1.00 | -2,100,000.00 | 0.0000 |
| 1 | 42,000.00 | 126,450.00 | 84,450.00 | 0.9091 | 76,772.73 | 1,980,000.00 |
| 2 | 42,840.00 | 123,921.00 | 81,081.00 | 0.8264 | 67,009.09 | 1,940,400.00 |
| 3 | 43,696.80 | 121,442.58 | 77,745.78 | 0.7513 | 58,411.56 | 1,901,592.00 |
| 4 | 44,570.74 | 119,013.73 | 74,442.99 | 0.6830 | 50,845.57 | 1,863,560.16 |
| 5 | 45,462.15 | 116,633.45 | 71,171.30 | 0.6209 | 44,191.78 | 1,826,288.96 |
| 6 | 46,371.39 | 114,300.78 | 67,929.39 | 0.5645 | 38,344.37 | 1,789,763.18 |
| 7 | 47,298.82 | 112,014.77 | 64,715.95 | 0.5132 | 33,209.51 | 1,753,967.91 |
| 8 | 48,244.80 | 109,774.47 | 61,529.68 | 0.4665 | 28,704.05 | 1,718,888.56 |
| 9 | 49,209.69 | 107,578.98 | 58,369.29 | 0.4241 | 24,754.28 | 1,684,510.78 |
| 10 | 50,193.89 | 105,427.40 | 55,233.52 | 0.3855 | 21,294.91 | 1,650,820.57 |
4. Standards & compliance (mini-cert block)
| Standard | Scope | Status for this use case | Reference |
|---|---|---|---|
| IEC 62933-2-1:2017 | BESS safety — stationary applications | Procurement spec — confirm vendor cert at RFQ | IEC Webstore catalogue |
| IEC 62477-1:2016/AMD1:2017 CSV | Power electronic converter safety | Procurement spec — confirm vendor cert at RFQ | IEC Webstore catalogue |
| IEEE 1547 / IEEE 2800 | Interconnection (grid-tied) | Procurement spec — confirm conformance with local ONS / CAMMESA / CENACE rules | IEEE Xplore; local grid-code resolution number |
| UL 1973 | Stationary / motive auxiliary battery | Recommended for LFP cells | UL 1973 product page |
| UL 9540A | Thermal runaway propagation test | Recommended for indoor/containerized LFP | UL Standards catalog (UL 9540A) |
| UN 38.3 (ST/SG/AC.10/11/Rev.7) | Lithium-battery transport test | Mandatory for shipment of LFP cells | UN Manual of Tests and Criteria |
| Regulation (EU) 2023/1542 | EU Battery Regulation | Applies if destination is EU | EUR-Lex 2023/1542 |
5. HS code & duty lookup
HS classification for BESS units varies by jurisdiction and by whether the unit is imported as a complete enclosure, as cells with separate PCS, or as a kit. This page does not assert a duty rate; use the official lookups below and confirm with a licensed customs broker in the destination country.
| HS heading (candidate) | Description | Lookup |
|---|---|---|
| 8507.60 | Lithium-ion accumulators (cells/modules) | EU: TARIC; US: USITC HTS; UK: UK Global Tariff |
| 8504.40 | Static converters (PCS) | Same lookups |
| 8504.90 | Parts of static converters | Same lookups |
| 8537.10 | Boards / panels for electric control (EMS, BMS) | Same lookups |
| 9405 / 7612 | Enclosures / racking (aluminium, steel) | Same lookups |
Additional destination lookups: Japan — Japan Customs; Australia — Australian Border Force; South Africa — SARS; Ghana — GRA; Uganda — URA; general — US ITA, US CBP.
Brazil: duty and tariff resolution numbers are published by ANEEL (tariff) and by Receita Federal / Comex Stat (NCM duty). The specific ANEEL tariff resolution number for the SE/CO industrial MV reference band is not asserted on this page; confirm against the current ANEEL resolution before procurement. Brazilian SE/CO reference band used here as a model assumption.
Freight / Incoterms: ICC Incoterms 2020; dangerous goods carriage: IATA DGR; freight documents: FIATA; wood packaging: IPPC ISPMs (ISPM 15).
6. CTAs
Request a quote (RFQ): /rfq/
Download the scenario model: /assets/steel-plant-ess-latam-tco-model.pdf (scenario TCO model — spreadsheet + summary PDF).
7. Sources & citations
- EU Battery Regulation — Regulation (EU) 2023/1542.
- UN Manual of Tests and Criteria — UN 38.3, ST/SG/AC.10/11/Rev.7.
- UL 1973 — UL 1973 product page.
- IEC Webstore catalogue — webstore.iec.ch (IEC 62933-2-1:2017; IEC 62477-1:2016/AMD1:2017 CSV).
- CATL energy storage — catl.com/en/ess/ (CATL 280 Ah prismatic LFP cell; exact firmware / manual revision confirmed at RFQ).
- Sungrow Power — sungrowpower.com/en (ST3440KWH(S)-3500UD-MV PCS skid family; datasheet rev confirmed at RFQ).
- EU TARIC — TARIC consultation; USITC HTS — hts.usitc.gov; UK Global Tariff — trade-tariff.service.gov.uk.
- ICC Incoterms 2020 — iccwbo.org.