Businesses are under increasing pressure to increase operational efficiency, boost sustainability, and reduce operational costs. One method of achieving these goals is by utilising energy solutions, particularly battery and other energy storage systems. Energy storage systems play a pivotal role in helping to optimise energy usage, reduce waste, and contribute to a greener future.
Understanding Peak Demand
Due to fluctuating energy prices, many businesses face demand charges on their electricity bills during peak consumption periods, also known as peak demand. Peak demand can significantly increase energy costs. Typically occurring during midday or late afternoon, utility companies charge higher rates to manage the strain on the grid. Businesses need to manage and reduce these peak charges effectively without compromising their operations. Batteries and storage solutions are an efficient solution.
Understanding Batteries
Battery energy storage systems have become a favoured solution for cutting back peak demand costs. These systems store electricity when demand and rates are at their lowest, and this energy can be utilised when costs rise.
How Batteries Work to Reduce Peak Demand Costs
Peak Shaving: Batteries allow businesses to avoid drawing from the grid during times of peak demand. Instead, they discharge the energy they have stored, effectively reducing consumption and lowering charges.
Time-of-Use Optimisation: Batteries can be programmed to charge during off-peak hours when rates are at their lowest, so that the stored energy can be dispatched at the times rates are at their highest – helping avoid costly peak-hour energy prices.
Energy Independence and Resilience: Alongside reducing energy costs, battery storage solutions can provide a source of power during power outages or interruptions, providing an extra source of energy security.
Demand Response Participation: Demand response programs mean businesses can get compensated for reducing their energy usage during grid strain events. Batteries can make this process seamless by automatically discharging stored energy, allowing businesses to participate without disrupting operations.
Other Energy Storage Solutions
While batteries are at the forefront of energy storage, other technologies can serve as alternatives, depending on a business’s needs:
Thermal Energy Storage: This energy system stores heat or cold for later use, which can be useful with HVAC systems in large commercial buildings. By using stored thermal energy during peak periods, reliance on the grid is reduced.
Flywheels: Flywheel energy storage systems store kinetic energy and can discharge it quickly when needed. They’re typically used in conjunction with batteries to provide short bursts of power during peak times, helping to reduce charges.
Hydrogen Storage: Hydrogen fuel cells can store hydrogen gas and convert it back into electricity when needed. This technology has great potential for large-scale energy storage and is being explored as a long-term, sustainable solution for businesses.
Benefits of Energy Storage Solutions
Energy storage is beneficial for several reasons other than cutting energy costs. It is also an investment in sustainability, operational flexibility, energy security, and resilience.
Cost Savings: By avoiding peak demand charges and optimising energy use, businesses can see reductions in their utility bills, which are typically one of the largest expenses to an organisation.
Sustainability Goals: Energy storage, when coupled with renewable energy sources like wind or solar panels, can help businesses meet their sustainability targets. Stored renewable energy can be used to power operations during peak times, reducing reliance on fossil fuel-generated electricity.
Enhanced Energy Management: With the help of advanced energy management systems, businesses can monitor and control their energy usage in real-time, enabling smarter decision-making. These systems can automate when batteries discharge, further maximising savings without manual intervention.
Grid Support: Some energy storage systems can also participate in grid services like frequency regulation, where businesses are compensated for providing stored energy to stabilise the grid. This not only generates revenue but also supports the broader energy infrastructure.
As businesses face rising energy costs and greater pressure to adopt sustainable practices, energy storage solutions—particularly battery systems—are becoming a critical component of energy management strategies. By reducing peak demand charges, enhancing operational resilience, and supporting sustainability goals, these systems offer a compelling value proposition for businesses of all sizes.
Investing in energy storage is more than just an opportunity to lower costs; it’s a step toward future-proofing your business in an increasingly energy-conscious world. Whether through batteries, thermal energy storage, flywheels, or hydrogen storage, businesses have a range of options to meet their energy storage needs.