Energy storage is a vital part of the new power system architecture, helping balance the generation variability, enable a higher proportion consumption of self-generated renewable energy, and reduce the need to store excess electricity back into the grid.
FREMONT, CA: Many countries are increasing their renewable energy reliance to support their net-zero goals to meet electricity demands through renewable sources in the coming years. With its grid balancing and renewable power optimisation services, energy storage offers businesses the right opportunity to discover clean energy potential.
As renewable power penetration increases, the operational dynamics of the power system will drastically transform, demanding a system architecture change. Energy storage is becoming a quintessential part of the new power system model as it helps to balance out the variability in generation while enabling a higher proportion of self-generated renewable power by consumers and reducing the need to feed excess electricity back into the grid.
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At the grid-scale level, energy storage is essential to efficiently managing demand and supply dynamics. This includes managing the short-term peak power requirement and maintaining the frequency when the grid encounters challenges. Pumped-hydro storage has conventionally been the most widely used storage technology globally. Its environmental and geographical limitations pave the way for more prominent new technology like batteries and fuel cells.
Benefits for Commercial and Industrial Consumers
Energy storage systems have already started to assist businesses in reducing their dependence on fossil fuels, such as diesel, and leveraging renewable power use in a commercially viable way. The commercial viability for deployment by commercial and industrial consumers relies on applicable use cases, location and operation type, and potential access to renewable energy, amongst other factors.
A recent initiative commissioned one megawatt-hour (MWh) battery energy storage system connected to solar power. The installed system offers battery storage as a power backup during grid downtime as an alternative to a diesel generator, aiding the offtaker to save a considerable amount of diesel annually.
For commercial and industrial consumers, energy storage deployment will make commercial sense if their diesel generation set usage exceeds 20 minutes per day and electricity tariffs trend upwards. It will also be relevant for those with the potential to install additional solar power and operate in regions where net metering is not allowed for commercial and industrial consumers.
The increasing limitations occurring due to the banking surplus renewable power on the grid for later use and net metering incentive withdrawal act as catalysts for further energy storage market growth.
Among commercial and industrial consumers, there is a lack of awareness about the suitability of energy storage systems for their operations, primarily due to the absence of tools to capture electricity consumption data at the frequency and duration required. Technologies like energy storage will play a critical role in supporting combat against the climate crisis.
While regulatory frameworks and policies regarding grid-scale deployment are released, businesses should embrace them by ensuring access to and analysis of the informative data such as solar power generation profile, the potential for excess solar power and regular diesel use for power back-up, and identifying suitable business models for deployment to yield the commercial energy storage adoption benefits.