What’s all this Hype about Solar + Storage?
Combining solar and energy storage can generate significant value for commercial energy customers. Due to technology improvements and cost reductions, installing storage with solar can maximize energy savings potential and, with innovative financing solutions, it can be accomplished without using valuable capex dollars. That’s why REC Solar and Duke Energy recently entered into a partnership with Green Charge Networks to provide commercial energy customers the highest-value and most comprehensive storage and energy management solutions.
The old thinking on solar + storage
In the past, energy storage (a.k.a. batteries) were seen as expensive and non-essential add-ons to solar installations. They required significant maintenance and rarely generated positive cash flow. Historically, the only reason for paying extra for onsite energy storage was to provide back-up power during blackouts or other unexpected electricity outages. Therefore, for most companies, energy storage was seen as an expensive investment for something that might be used once a year—or even less.
The new thinking on solar + storage
Today, it’s a new story. First, storage solutions have dropped in price thanks to new battery innovations that store more energy for less. Along with battery cost declines, advanced energy management software can now analyze a business’ electricity usage and draw energy from the least expensive source at any given point in time.
For example, at high noon when the sun is shining, the facility’s energy could be drawn directly from the solar panels and energy storage system, reducing a company’s peak usage when energy is most costly and recharging the battery during the morning or late evening when energy is less costly. Ultimately, by combining solar and energy storage a building can use energy smarter and the net cost to operate a building decreases.
Top peak shaving benefit: Reducing high demand charges
Most significantly, commercial solar plus storage can dramatically reduce costly demand charges, which can often make up half of a commercial or industrial company’s electric bill.
When a factory or business first turns on machines or a thermostat turns on heating and cooling systems, power usage surges to a level that’s higher than normal. Even if the power spike lasts just a few minutes, the utility will typically charge customers an additional monthly fee based on the peak kilowatt (kW) of power reached at that moment. Their reasoning is that they have to compensate for these surges by maintaining surplus power capacity, and they’re passing those costs on to the consumer.
To avoid these monthly demand charges, companies have to eliminate power consumption surges. That’s where solar with energy storage can help both customers and utilities. Energy management software can anticipate these power surges and draw energy from the building’s batteries, thus eliminating surges, helping balance the grid—and reducing expensive demand charges for a commercial or industrial facility.
Solar Plus Energy Storage Financing
The last element that’s getting companies excited about adding energy storage to solar systems is the new era of solar financing. Several years ago, solar and storage systems had to be purchased with cash or loans. Today, solar power purchase agreements (solar PPAs) allow companies to install solar and storage systems with little to no upfront costs. The PPA typically provides a business with lower electric rates than the local utility.
In addition, solar PPAs provide predictable, below market energy costs over the life of the energy sale contract. REC Solar’s PPA is backed by Duke Energy, the largest energy company in the United States, providing customers with even greater confidence in our long-term agreements.
The hype about solar and energy storage is real, and since the 30% investment tax credit (ITC) for solar has been extended five more years, the time is now to enjoy some of the best financial returns possible. With solar plus storage, your company could discover significant savings, all while doing your part to reduce the negative effects of excess carbon in our atmosphere. Our oceans and all the creatures that live and depend on them will thank you. Give us a call and let us evaluate what Solar + Storage can do for your company.