Battery Storage

Large energy storage systems, or batteries, extend the value of intermittent energy resources such as wind and solar. Inexpensive but intermittent energy is stored when there is a surplus and released (dispatched) when the resource dips in production or when a substitute is needed for grid energy when it is most expensive.

Many battery technologies, such as redox flow, flywheel, and compressed air, exist for different use cases. But most battery storage systems currently use lithium-ion cells like those found in laptop computers. In large energy storage systems, battery cells are joined together and connected in a series with a computer, or battery management system (BMS), that controls charging and discharging. Like solar systems, a battery storage system uses inverters to convert the energy stored as direct current (DC) into the more practical alternating current (AC).

Energy System With Solar,
Plus Batteries

Battery Storage

One cost of using a battery system is lost energy. Round-trip efficiency measures how much energy is lost during the charging, discharging, and inversion processes. Lithiumion batteries are superior in roundtrip efficiency and represent 80–90% of installed energy storage systems today.

For solar plants, the capital cost is primarily a function of the size and type of mounting or racking structure used for the solar array. Larger systems benefit from economies of scale. The most cost-effective racking solution is usually a static ground-mounted system using driven posts. Mounting the panels on a new carport is the most expensive type of mounting. Rooftop mounting structures typically fall in the middle.

Batteries are for savings Batteries can be used to save on energy costs when there are differences in prices based on the time of day, known as time-of-use (TOU) rates. The difference between peak (highest) and off-peak (lowest) rates can be $0.10 cents per kilowatt hour or even higher, and it’s generally greater in the summer than in the winter. The batteries can store energy when it is least expensive and dispatch the energy when it is most expensive.

Recently, utilities began dividing their energy charges into two main buckets: 1) the amount of energy used and 2) the maximum amount of energy used by the customer at any one time, known as demand. Many tariffs actually have two demand charges—one for the highest energy demand in the billing period and another for the highest energy demand during the on-peak periods in the same billing period. Demand charges can be more than 50% of a customer’s bill. Batteries are excellent at reducing demand charges. Batteries can be programmed to store energy until the user is nearing a peak point in energy consumption and release the energy at the same time so the energy drawn from the utility stays flat or even decreases. In this way, the utility would not see the customer’s demand peak, as illustrated here.

Optimization of how and when a battery charges and discharges requires sophisticated data analysis and controls. The system considers both known values (current value of energy, energy reserves available, current demand) and unknown values (future value, future demand, future production). Past energy consumption patterns help set a discharge profile, but good software controls an continue to learn from consumption and production patterns to get the most value from an energy system.

Between government incentives, reduced cost, and new smart controls, batteries now frequently pay for themselves and add additional value by shifting energy usage and reducing demand charges.