Cost Savings Benefits
1. Energy Arbitrage
- Definition: Energy arbitrage involves storing excess energy produced by solar panels when it’s cheap and using it during peak demand periods when electricity rates are higher. This strategy maximizes cost savings by avoiding high-rate electricity from the grid.
- Example: Businesses can charge their energy storage systems with grid electricity during off-peak hours (e.g., at night) and use the stored energy during peak hours when rates are higher, thus reducing electricity costs.
2. Peak Demand Reduction
- Strategy: By using stored solar energy during peak periods, businesses can reduce the maximum demand they draw from the grid. This reduces peak demand charges, which can significantly lower overall energy bills.
- Impact: Peak demand charges are often a substantial portion of commercial electricity bills. Reducing these charges can lead to substantial cost savings over time.
3. Avoidance of PV Export Penalties
- Context: With changes in net metering policies, such as NEM 3.0 in California, exporting excess solar energy to the grid becomes less financially rewarding. Energy storage mitigates this by allowing businesses to use excess energy onsite rather than exporting it.
- Benefit: By storing excess solar energy for later use, businesses avoid reduced export credits and ensure more efficient self-consumption of the energy they generate, increasing the return on investment (ROI) from their solar systems.
4. Increased Self-Consumption
- Approach: Energy storage systems enable businesses to use more of the solar energy they produce directly, reducing reliance on utility electricity. This not only saves money but also enhances energy independence.
- Financial Benefits: Higher self-consumption ratios lead to lower electricity bills and increased energy efficiency, further enhancing the economic advantages of solar installations.
5. Enhanced ROI and Sustainability
- Sustainability Impact: Integrating energy storage with solar systems contributes to environmental sustainability by maximizing the use of renewable energy and reducing greenhouse gas emissions.
- Economic Impact: Enhanced sustainability can also act as a marketing advantage, potentially increasing property value and appeal to environmentally conscious consumers and investors.
Overall, integrating solar and energy storage systems can significantly enhance the economic viability of solar installations, providing substantial cost savings through efficient energy use strategies and improved ROI.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/what-are-the-cost-savings-associated-with-integrating-solar-and-energy-storage-systems/
