| Summary: | The recent advances in battery technology and reductions in battery costs have brought battery energy storage systems (BESS) to the point of becoming increasingly cost-effective projects to serve a range of power sector interventions, especially when combined with PV and where diesel is the alternative, or where subsidies or incentives are used. Quantifying the economic impact of BESS requires a high level of temporal granularity in the analysis, because the time-steps required for a reliable assessment of costs and benefits are much shorter than the usual annual time steps of many power sector investment projects. In short, there is as yet still limited experience in the economic and financial analysis of BESS investment projects particularly, in developing countries, and one cannot yet set out with clarity what constitutes best international practice. This report sets out the principles and practices of BESS economic analysis as required for the World Bank's appraisal of investment projects that cover the range of BESS projects likely to be encountered by the Bank over the next few years
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