Performance-Based Incentives
- Structure: These incentives reward energy storage system owners for providing specific services to the grid, such as demand response, virtual power plant participation, or contributions to grid stability.
- Payment Timing: Payments are made over time, often based on the system’s actual performance or energy saved and provided to the grid.
- Purpose: Encourages ongoing efficient use of energy storage systems to support grid operations and stability.
- Duration: Can be available for several years, such as up to 10 years for residential customers.
Upfront Rebates
- Structure: Offered as a one-time payment to customers who purchase and install an eligible energy storage system.
- Payment Timing: Payment is made immediately after the installation of the energy storage system.
- Purpose: Encourages the initial purchase of energy storage systems by reducing upfront costs.
- Duration: Typically a one-time benefit, with no ongoing payments.
Overall, performance-based incentives focus on long-term benefits and system performance, while upfront rebates focus on initial cost reduction to encourage adoption.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-do-performance-based-incentives-differ-from-upfront-rebates-for-energy-storage/
