Commercial Energy Storage: Sustainability’s Low-Hanging Fruit

Feb 27, 2017 3:00 PM ET
Campaign: Sustainability
Commercial Energy Storage - Sustainability's Low Hanging Fruit

It is easy to talk about sustainability, especially when the timeframes for achieving quantifiable results are comfortably far in the future. It’s much harder to actually implement feasible sustainability programs that will have a significant business impact. A survey of more than 3,000 executives by the MIT Sloan Management Review and the Boston Consulting Group found that while nearly 90 percent of respondents consider a sustainability strategy essential to remaining competitive, only 60 percent have such a strategy. And only 25 percent have developed a clear business case for sustainability.

But if sustainability is truly essential, clear strategies and their implementation cannot be delayed. Executives can make some headway by seeking out projects that will elicit minimal resistance, while delivering measurable results that will encourage buy-in to future sustainability efforts.

Commercial Energy storage: a good place to start

Commercial behind-the-meter energy storage consists of on-site storage hardware (typically a battery and an inverter) and remote management-and-control software. Businesses often use these systems to reduce energy costs by avoiding demand charges or by performing energy arbitrage (drawing power during off-peak periods and using it during peak periods).

Today, it’s easy for businesses to get started with energy storage, because they don’t need to purchase the system outright; they can lease it—or, even better, enter into a shared-savings agreement, paying an amount based on the quantified savings the storage system accrues—so there’s no capital expense. When the storage is owned and maintained by the storage provider, there’s no risk either.

But where’s the sustainability? It’s not in the storage system itself (although leading storage systems adhere to sustainability best practices in materials, design, maintenance, and end-of-life), but rather in what the storage system enables. Think of it as a sustainability tool. Here are some of the ways it can be used:

Make renewable self-generation feasible. Companies often reject solar projects because solar power purchase agreement (PPA) rates exceed grid costs. Field studies have shown that the savings from a storage system coupled with a solar PV plant can bring effective PPA rates below the utility’s cost per kWh.

Reduce need for coal-fired peaker plants and backup generators. Behind-the-meter energy storage systems can draw power during off-peak times for later use, reducing the load volatility that drives the need for peaker plants (power plants used only in periods of high demand). For the commercial user, the storage system serves as a backup supply, reducing the need for emission-heavy diesel generators.

Facilitate the proliferation of electric vehicle charging stations. Although the leading EV charging networks offer attractive incentives to install their chargers, businesses and public agencies worry about the impact that unpredictable EV charging events can have on their electricity load profiles. Energy storage systems can automatically detect charging events and discharge power to avoid creating a demand spike that can result in a costly demand charge.

Designed to save money, shared-savings-based energy storage solutions are arguably the most inexpensive way to get the sustainability ball rolling. Only talk is cheaper.

To learn more about energy storage and sustainability click here to download the Sustainability Primer.