In the context of rapid technological iteration in energy storage thermal management, mainstream products have recently transitioned from air cooling to indirect liquid cooling, while immersion liquid cooling is moving from demonstration to full application. However, the economic advantages of immersion liquid cooling have not been thoroughly discussed. In this study, we systematically compare three common thermal management systems for battery energy storage systems: air cooling, indirect liquid cooling, and immersion liquid cooling. We evaluate key performance indicators such as weight/volume grouping efficiency, temperature rise/temperature difference, and operation and maintenance processes. Based on an extensive survey of energy storage systems, we establish an economic model that accounts for the characteristics of the thermal management system and incorporates the impact of battery capacity degradation. We compare costs, net present value (NPV), dynamic investment payback period (DIPP), and internal rate of return (IRR), and perform sensitivity analysis on key parameters. Our results demonstrate that over long-term operation, a battery energy storage system with immersion liquid cooling achieves an IRR increase of 3.2% compared to indirect liquid cooling and 9.1% compared to air cooling. Furthermore, immersion liquid cooling maintains a stable rate of return under market fluctuations. The yield of the battery energy storage system is sensitive to the peak-valley electricity price difference, and immersion liquid cooling provides more robust returns under volatile market conditions. These findings provide valuable guidance for the construction and operation of energy storage power stations.
1. Introduction
The increasing demand for large capacity, long lifetime, and high safety in energy storage products has driven the development of advanced thermal management technologies. Lithium-ion batteries, as the most widely used electrochemical energy storage technology, generate significant heat during charge and discharge, especially at high rates. If heat is not removed promptly, battery performance and lifetime are severely compromised, and in extreme cases, thermal runaway may occur. Currently, the mainstream thermal management methods for integrated energy storage systems include air cooling and liquid cooling. Liquid cooling is predominantly indirect liquid cooling, while immersion liquid cooling is still rarely used in commercial products. Air cooling uses air as the heat transfer medium, typically relying on air conditioners for cooling. Liquid cooling uses a coolant; indirect liquid cooling exchanges heat through cold pipes and cold plates, whereas immersion liquid cooling directly contacts the battery with the coolant, both using chillers. Previous studies have explored improvements in battery pack design, cooling channel optimization, and the use of highly conductive materials for air cooling. For indirect liquid cooling, research has focused on the size and layout of liquid flow channels. Immersion liquid cooling, with its direct contact nature, offers higher cooling efficiency and can also prevent thermal runaway fires when using specific coolants. Current research on immersion cooling includes developing new coolants (e.g., hydrofluoroethers, water-glycol mixtures, hydrocarbons, silicone oils, esters) and optimizing immersion parameters such as immersion ratio, flow rate, and battery spacing.
Economic analyses of energy storage power stations often focus on the overall system in specific application scenarios, without detailed consideration of the thermal management system. Few studies have investigated the economic differences among different thermal management methods, especially immersion liquid cooling. In this paper, we address this gap by establishing a comprehensive economic model that incorporates the characteristics of thermal management systems and battery capacity fade over time. We perform a comparative analysis of three representative thermal management approaches for a 10 MWh battery energy storage system.
2. Models for Thermal Management System and Economic Evaluation
2.1 Thermal Management System Cost Model
The cost model for a thermal management system includes equipment cost, operation and maintenance cost, and life-cycle cost.
Equipment Cost
The equipment cost is calculated as:
$$
E_p = \sum (p_e \times j)
$$
where \(E_p\) is the equipment cost, \(p_e\) is the unit price of specific equipment, and \(j\) is the required quantity of that equipment.
Operation and Maintenance Cost
The operation and maintenance cost is expressed as:
$$
E_{O\&M} = E_m + E_l + E_e
$$
where \(E_{O\&M}\) is the operation and maintenance cost of the thermal management system, \(E_m\) is the maintenance cost, \(E_l\) is the coolant loss cost (only for liquid cooling), and \(E_e\) is the electricity consumption cost of the thermal management system.
Life-Cycle Cost
The total life-cycle cost is:
$$
LCC = E_p + E_i + E_{O\&M} + E_d
$$
where \(LCC\) is the life-cycle cost, \(E_i\) is the installation cost, and \(E_d\) is the disposal cost.
2.2 Energy Storage System Economic Model
The economic model for the entire battery energy storage system includes cost components and revenue components, considering taxes and financial parameters.
Cost Model
Total cost over the life cycle is:
$$
C_{all} = C_{self+loan+interest} + C_e + C_{O\&M} + C_b
$$
where the self-financing, loan, and interest part is:
$$
C_{self+l+i} = (C_{unit} \times S) \times \alpha + (C_{unit} \times S) \times (1-\alpha) \times \frac{i (1+i)^n}{(1+i)^n-1}
$$
\(C_e\) is the electricity cost including thermal management and battery charging:
$$
C_e = (E_h \times c_h + E_l \times c_l + S \times c_l)
$$
\(C_{O\&M} = C_{all} \times \eta\) where \(\eta\) is the O&M ratio. \(C_b = S \times c_b\) is the battery replacement cost. Here \(C_{unit}\) is the EPC unit price, \(S\) is the system capacity, \(\alpha\) is the self-financing ratio, \(i\) is the loan interest rate, \(n\) is the loan period, \(E_h\) and \(E_l\) are electricity consumption during high-price and low-price periods, \(c_h\) and \(c_l\) are corresponding electricity prices, and \(c_b\) is the unit battery replacement cost.
Revenue Model
Total revenue is:
$$
I_{all} = I_s + I_d + I_o + I_c
$$
where \(I_s\) is the government subsidy, \(I_d = (S \times DOD \times (c_{sell} – c_l))\) is the peak-valley spread revenue, \(I_o = (I_d – C_e) \times i_o\) is other income, and \(I_c = C_{all} \times i_s\) is depreciation income. \(DOD\) is the depth of discharge, \(c_{sell}\) is the selling electricity price, \(i_o\) is the other income ratio, and \(i_s\) is the residual value ratio.
Tax Related Items
Total tax includes value-added tax (VAT), surcharge, and income tax:
$$
T_{all} = T_v + T_a + T_i
$$
2.3 Evaluation Indicators
Net Present Value (NPV)
NPV is calculated as:
$$
NPV = \sum_{n=1}^{N} \frac{I_n – O_n}{(1+g)^n}
$$
where \(N\) is the project lifetime, \(I_n\) is annual revenue, \(O_n\) is annual expenditure (including tax), and \(g\) is the minimum acceptable rate of return.
Dynamic Investment Payback Period (DIPP)
DIPP is the time when cumulative discounted net cash flow becomes positive:
$$
DIPP = n’ – 1 + \frac{\sum_{n=1}^{n’} (I_n – O_n)/(1+g)^n}{(I_{n’} – O_{n’})/(1+g)^{n’}}
$$
where \(n’\) is the year when cumulative net present value first becomes positive.
Internal Rate of Return (IRR)
IRR satisfies:
$$
\sum_{n=1}^{N} \frac{I_n – O_n}{(1+IRR)^n} = 0
$$
3. Comparative Analysis of Thermal Management Technologies
We selected representative products from the market for a 10 MWh battery energy storage system. The key parameters are summarized in the following tables.
The following figure shows a typical layout of a battery energy storage system used in this study.
3.1 Key Performance Indicators
Weight and Volume Grouping Efficiency
Weight grouping efficiency (WGE) and volume grouping efficiency (VGE) are defined as the ratios of total cell weight/volume to the total weight/volume of the energy storage container. Table 1 summarizes the average values obtained from product samples.
| Thermal Management | WGE (%) | VGE (%) |
|---|---|---|
| Air Cooling | 45.90 | 15.92 |
| Indirect Liquid Cooling | 59.23 | 25.06 |
| Immersion Liquid Cooling | 44.19 | 26.45 |
Immersion liquid cooling has lower weight efficiency due to the additional mass of the immersion tank and coolant, but it achieves the highest volume efficiency, enabling higher energy density in the same space.
Temperature Control Capability
Under typical operating conditions, the temperature control performance is compared in Table 2. Immersion liquid cooling limits the maximum temperature rise to only 5°C and the maximum temperature difference within the pack to 2°C, significantly outperforming both air cooling and indirect liquid cooling.
| Thermal Management | Max Temperature Rise (°C) | Max Temperature Difference (°C) |
|---|---|---|
| Air Cooling | 10 | 5 |
| Indirect Liquid Cooling | 7 | 5 |
| Immersion Liquid Cooling | 5 | 2 |
3.2 Operation and Maintenance Comparison
Regular maintenance tasks for each system are listed in Table 3. Immersion liquid cooling requires coolant level and quality checks, and replacement if needed, similar to indirect liquid cooling, but the coolant injection process is simpler because vacuum is not mandatory.
| Air Cooling | Indirect Liquid Cooling | Immersion Liquid Cooling |
|---|---|---|
| Check wiring visually | Check wiring visually | Check wiring visually |
| Check fan blades for smooth rotation | Check chiller fan blades | Check chiller fan blades |
| Inspect air conditioner for drain and condenser cleanliness | Inspect chiller condenser | Inspect chiller condenser |
| — | Coolant maintenance: test condition and replace if needed, drain and refill under vacuum | Coolant maintenance: test condition, drain and refill |
| — | Check for leaks using sensors | Check for leaks using sensors |
Fault handling procedures are compared in Table 4. Air cooling is the simplest, while both liquid cooling methods require draining and refilling coolant, and checking airtightness. Immersion liquid cooling does not require vacuum pumping during refill, saving time.
| Steps | Air Cooling | Indirect Liquid Cooling | Immersion Liquid Cooling |
|---|---|---|---|
| 1 | Disconnect power and signal cables | Disconnect power and signal cables | Disconnect power and signal cables |
| 2 | Remove faulty battery pack | Drain coolant | Drain coolant |
| 3 | Return for repair | Remove cooling pipes | Remove cooling pipes |
| 4 | Install new pack | Remove battery pack | Remove battery pack |
| 5 | Reconnect cables | Return for repair | Return for repair |
| 6 | — | Install new pack | Install new pack |
| 7 | — | Connect cooling pipes | Connect cooling pipes |
| 8 | — | Check air tightness of pipes | Check air tightness of pipes |
| 9 | — | Vacuum pump | Refill coolant |
| 10 | — | Refill coolant | Reconnect cables |
| 11 | — | Reconnect cables | — |
4. Economic Comparison of Thermal Management Systems
4.1 Equipment Cost
Using market prices and sizing for a 10 MWh system, the average equipment cost per kWh is shown in Table 5. Air cooling has the lowest upfront cost, while immersion liquid cooling is slightly higher than indirect liquid cooling.
| Thermal Management | Equipment Cost (yuan/kWh) |
|---|---|
| Air Cooling | 35 |
| Indirect Liquid Cooling | 40 |
| Immersion Liquid Cooling | 44 |
4.2 Operation and Maintenance Cost
Assuming 330 operating days per year and 4 hours per day, the annual O&M cost per kWh is broken down in Table 6. Immersion liquid cooling has higher maintenance cost due to more expensive equipment, but lower electricity consumption due to better efficiency. Coolant loss adds a small cost.
| Component | Air Cooling | Indirect Liquid Cooling | Immersion Liquid Cooling |
|---|---|---|---|
| Maintenance | 1.75 | 2.00 | 2.20 |
| Electricity | 6.84 | 5.36 | 5.10 |
| Coolant loss | 0 | 0.06 | 0.60 |
| Total | 8.59 | 7.42 | 7.90 |
4.3 Life-Cycle Cost
Using a 20-year life cycle, the total life-cycle cost per kWh is presented in Table 7. Although air cooling has the lowest initial cost, its high operating electricity cost results in the highest life-cycle cost. Indirect liquid cooling shows the lowest life-cycle cost, while immersion liquid cooling falls in between.
| Component | Air Cooling | Indirect Liquid Cooling | Immersion Liquid Cooling |
|---|---|---|---|
| Equipment | 35.00 | 40.00 | 44.00 |
| Installation (5%) | 1.75 | 2.00 | 2.20 |
| O&M (20 years) | 171.80 | 148.40 | 158.00 |
| Disposal | 0 | 0 | 0 |
| Total LCC | 208.55 | 190.40 | 204.20 |
5. Economic Performance of the Battery Energy Storage System
We evaluate a 10 MWh battery energy storage system operating for 20 years with typical parameters: EPC costs for air cooling 1.17 yuan/Wh, indirect liquid cooling 1.30 yuan/Wh, immersion liquid cooling 1.40 yuan/Wh; loan ratio 70%, interest rate 5%, loan period 120 months; battery cost 0.36 yuan/Wh, DOD 90%; peak electricity price 1.193 yuan/kWh, valley price 0.478 yuan/kWh; system efficiency 95%; annual operation 330 days. The results for NPV, DIPP, and IRR are summarized in Table 8.
| Indicator | Air Cooling | Indirect Liquid Cooling | Immersion Liquid Cooling |
|---|---|---|---|
| NPV (million yuan) | 1.2 | 3.8 | 5.5 |
| DIPP (years) | 12.5 | 9.8 | 7.1 |
| IRR (%) | 7.75 | 14.05 | 16.70 |
Immersion liquid cooling achieves the highest IRR (16.70%), 3.2% higher than indirect liquid cooling and 9.1% higher than air cooling. The payback period is reduced by about one-third compared to air cooling.
5.1 Sensitivity Analysis of IRR
We perform a one-at-a-time sensitivity analysis on the battery replacement price and the selling electricity price. Tables 9–11 show the IRR values under various combinations. Green cells indicate IRR >12%, yellow 8–12%, red <8%.
| Selling price (yuan/kWh) | Battery price (yuan/Wh) | ||||
|---|---|---|---|---|---|
| 0.40 | 0.38 | 0.36 | 0.34 | 0.32 | |
| 1.05 | 1.80 | 2.70 | 3.61 | 4.53 | 5.47 |
| 1.07 | 3.36 | 4.29 | 5.22 | 6.17 | 7.13 |
| 1.10 | 5.80 | 6.77 | 7.75 | 8.73 | 9.72 |
| 1.13 | 8.39 | 9.40 | 10.42 | 11.45 | 12.47 |
| 1.15 | 10.22 | 11.26 | 12.30 | 13.35 | 14.40 |
| Selling price (yuan/kWh) | Battery price (yuan/Wh) | ||||
|---|---|---|---|---|---|
| 0.40 | 0.38 | 0.36 | 0.34 | 0.32 | |
| 1.05 | 8.16 | 8.73 | 9.28 | 9.81 | 10.32 |
| 1.07 | 10.11 | 10.65 | 11.17 | 11.67 | 12.16 |
| 1.10 | 13.08 | 13.58 | 14.05 | 14.51 | 14.95 |
| 1.13 | 16.12 | 16.56 | 16.99 | 17.41 | 17.81 |
| 1.15 | 18.17 | 18.59 | 18.99 | 19.38 | 19.76 |
| Selling price (yuan/kWh) | Battery price (yuan/Wh) | ||||
|---|---|---|---|---|---|
| 0.40 | 0.38 | 0.36 | 0.34 | 0.32 | |
| 1.05 | 11.98 | 12.25 | 12.52 | 12.79 | 13.05 |
| 1.07 | 13.64 | 13.90 | 14.17 | 14.43 | 14.68 |
| 1.10 | 16.20 | 16.45 | 16.70 | 16.95 | 17.19 |
| 1.13 | 18.84 | 19.08 | 19.31 | 19.54 | 19.77 |
| 1.15 | 20.65 | 20.88 | 21.10 | 21.32 | 21.53 |
The ratio of change in IRR to change in parameter (dy/dx) is summarized in Table 12. Immersion liquid cooling has the lowest sensitivity to both battery price and selling price, demonstrating its robustness.
| Parameter | Air Cooling | Indirect Liquid Cooling | Immersion Liquid Cooling |
|---|---|---|---|
| Battery price | 2.28 | 0.60 | 0.27 |
| Selling price | 12.33 | 7.60 | 5.65 |
6. Conclusion
In this paper, we have conducted a comprehensive comparison of three thermal management systems for battery energy storage systems: air cooling, indirect liquid cooling, and immersion liquid cooling. By establishing a full life-cycle economic model that accounts for battery capacity degradation, we have evaluated the key performance indicators and economic outcomes for a 10 MWh battery energy storage system. The main conclusions are:
- Immersion liquid cooling offers the highest volume grouping efficiency and the best temperature control (maximum temperature rise of 5°C and temperature difference of 2°C), significantly outperforming air cooling and indirect liquid cooling.
- While immersion liquid cooling has a slightly higher initial equipment cost (44 yuan/kWh) compared to air cooling (35 yuan/kWh) and indirect liquid cooling (40 yuan/kWh), its lower operational electricity consumption leads to a life-cycle cost that is lower than air cooling but higher than indirect liquid cooling.
- Due to the extended battery lifetime and improved efficiency, the immersion liquid cooling system yields the highest IRR (16.70%), which is 3.2% higher than indirect liquid cooling and 9.1% higher than air cooling. The dynamic payback period is reduced by about one-third.
- Sensitivity analysis reveals that the IRR of all systems is most sensitive to the selling electricity price. Immersion liquid cooling exhibits the lowest sensitivity to both battery price and selling price, indicating more stable returns under market fluctuations.
- These results suggest that immersion liquid cooling is a promising thermal management technology for battery energy storage systems, especially in applications where long-term economic performance and temperature uniformity are critical.