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Listen Up: The Economics of Commercial Energy Storage Systems

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There is no doubt in my mind that energy storage systems (ESS) will be as ubiquitous as solar — in all market segments. Utility companies are installing these systems to balance their intermittent demand and generation of electricity. Homeowners will install these systems for backup power and to store their daytime solar power for use at night. But for pure economic reasons, perhaps the most compelling market of all is for commercial and industrial (C&I) building operators.

Electricity bills for commercial and industrial buildings are composed of two charges: energy usage (measured in kwh) and demand charges (measured in kw). C&I customers often pay thousands of dollars a month for the peak power demand they encounter during any 15-minute period. Depending on the equipment being used in the building, these demand charges can exceed the energy usage charges. For example, a facility’s average demand may be 100 kW ($2,000 a month with a $20/kW demand charge), but for several hours a month the demand may spike up to 300 kW ($6,000/month). An ESS that senses when these demand peaks occur — and then discharges batteries instead of drawing power from the grid — can completely eliminate these high peak demand charges.

To learn more about the economics of commercial energy storage systems — and why these systems are rapidly gaining market traction — Listen up to this week’s Energy Show on Renewable Energy World.

About the Energy Show

As energy costs consume more and more of our hard-earned dollars, we as consumers really start to pay attention. But we don't have to resign ourselves to $5/gallon gas prices, $200/month electric bills and $500 heating bills. There are literally hundreds of products, tricks and techniques that we can use to dramatically reduce these costs — very affordably.

The Energy Show on Renewable Energy World is a weekly 20-minute podcast that provides tips and advice to reduce your home and business energy consumption. Every week we'll cover topics that will help cut your energy bill, explain new products and technologies in plain English, and cut through the hype so that you can make smart and cost-effective energy choices.

About Your Host

Barry Cinnamon is a long-time advocate of renewable energy and is a widely recognized solar power expert. In 2001 he founded Akeena Solar — which grew to become the largest national residential solar installer by the middle of the last decade with over 10,000 rooftop customers coast to coast. He partnered with Westinghouse to create Westinghouse Solar in 2010, and sold the company in 2012.

His pioneering work on reducing costs of rooftop solar power systems include Andalay, the first solar panel with integrated racking, grounding and wiring; the first UL listed AC solar panel; and the first fully “plug and play” AC solar panel. His current efforts are focused on reducing the soft costs for solar power systems, which cause system prices in the U.S. to be double those of Germany.

Although Barry may be known for his outspoken work in the solar industry, he has hands-on experience with a wide range of energy saving technologies.  He's been doing residential energy audits since the punch card days, developed one of the first ground-source heat pumps in the early ‘80s, and always abides by the Laws of Thermodynamics.

This podcast was originally produced by Spice Solar and was presented here with permission.

Lead image credit: Patrick Breitenbach | Flickr

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