Energy Arbitrage Basics
Energy arbitrage involves storing excess energy from solar panels in a battery during periods when the energy is less valuable and using it when it is more valuable. This typically means charging the battery with solar energy during the day when energy is cheaper and discharging it during peak demand hours when electricity costs are higher.
Enhancing ROI for Solar Systems
- Increasing Value of Solar Energy: By storing excess solar energy when it is less valuable and using it when it is more valuable, the overall value of the solar energy generated increases. For example, if solar energy is worth 10 cents per kWh midday but can offset consumption costing 28 cents per kWh during peak hours, homeowners can save 18 cents per kWh.
- Reducing Electricity Costs: Energy arbitrage helps homeowners reduce their electricity bills by using stored solar energy during peak pricing periods, thus avoiding higher grid electricity costs.
- Maximizing Energy Self-Consumption: Solar systems with battery storage can maximize self-consumption of solar energy, reducing reliance on grid electricity and potentially increasing savings through avoided grid purchases.
- Export Opportunities: In some regions, energy arbitrage can also involve exporting stored energy back to the grid during high-value periods, potentially increasing the revenue from solar energy exports.
- Supporting Deregulated Markets: In markets with dynamic pricing, energy storage allows consumers to take advantage of price fluctuations, further enhancing the financial benefits of solar installations.
By leveraging energy arbitrage, solar systems can become more profitable and attractive to homeowners, thereby enhancing their ROI through reduced energy costs and increased efficiency in energy usage.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-does-energy-arbitrage-enhance-the-roi-of-solar-systems/
