Balancing flexibility and longevity: Degradation-aware scheduling of distributed energy resources

This study presents a mixed-integer linear programming model for minimum-cost scheduling of distributed energy resources in a grid-connected building complex. The model integrates detailed degradation mechanisms for a battery energy storage system (BESS) and a micro-combined heat and power (micro-CHP) unit. It embeds both cycle-induced and calendar-related battery aging, as well as thermal and mechanical degradation of the micro-CHP, directly into the cost optimization, enabling explicit trade-offs between short-term operational flexibility and long-term asset preservation. When both degradation mechanisms are considered together, a clear complementarity emerges: the micro-CHP consolidates operations into fewer, longer, higher-value periods — avoiding start/stop events and low-value hours — while the BESS adopts shallower, less frequent cycles to smooth residual demand and price peaks. Using self-consumption and self-sufficiency ratios as performance indicators, the degradation-aware strategy slightly increases on-site energy utilization while reducing overall grid independence. A sensitivity analysis under different energy price conditions shows that cost levels and dispatch decisions vary, while the qualitative effects of degradation-aware scheduling remain consistent. Incorporating degradation limits excessive use of flexible assets and supports more accurate cost assessment and sustainable operation of distributed energy resources in active buildings.