How Energy Storage Solutions Compliment Distributed Energy Storage
While it might seem like businesses have little choice in how they receive electricity, emerging technologies (like energy storage solutions) are allowing organizations to tap into local energy sources to gain greater control over their energy usage and costs.
As opposed to the traditional means of utilities sourcing power from large-scale facilities in order to serve a region, distributed electricity generation works by tapping into small, local power generation sources in order to serve an area as small as one end-user. Distributed electricity generation often comes from modular and renewable energy sources like solar PV and battery technologies that can produce power on-site or near the end-user.
These technologies can power a microgrid, which is a localized power distribution system that connects to the traditional grid but can also be disconnected at any time to run on its own. So instead of relying on major power plants to distribute power through the traditional grid, microgrids can use distributed electricity generation and storage solutions in order to provide power based on what the end user wants.
The Growing Market
Already, distributed electricity generation is catching on across the U.S. For instance, hundreds of thousands of small-scale solar PV systems added up to 33% of total U.S. solar power generation, as estimated in September 2015 by the U.S. Energy Information Administration. California, in particular, has caught on to this technology, with 40% of distributed PV power coming from the state during that time.
And these technologies are likely to become much more prevalent. Research and Markets projects that the global distributed energy generation market will have a compound annual growth rate of 8.9% from 2016-2021.
The U.S. energy storage market is also on the rise, growing by 243% in 2015, according to GTM Research/Energy Storage Association as reported in Green Tech Media. By 2020, the market is expected to be valued at $2.5 billion and reach 1.7 gigawatts, which is nearly eight times more capacity than in 2015.
Benefiting from Local Power
This growing market isn’t just a byproduct of the growing movement to buy locally to support local economies and the environment. Instead, distributed electricity generation and electricity storage solutions allow businesses to avoid some of the downsides of the traditional grid, such as price volatility.
The cost of energy distributed from major power plants is largely dependent on the overall demand placed on the grid. Utilities have to account for being able to meet that demand, and in the end, customers end up paying more for the increased capacity needed to serve everyone.
For example, utility companies might have different rates throughout the day based on overall demand, whereby prices are higher during the day as more businesses require energy.
Using energy analytics software (EAS), organizations can gain better insight into how they use energy and how that affects costs. As a result, they can use this data to make smarter decisions about when and where to use energy.
If an organization uses an energy storage solution, for instance, EAS could help them determine when prices from the traditional grid are going to rise. With that knowledge, the company could then determine when it’s less expensive to switch off their connection to the main grid and rely purely on their microgrid generation and storage assets.
The more clarity businesses have on costs from their utility companies, the better they can determine how distributed electricity generation and storage solutions work for them.
Request a complimentary energy efficiency assessment to find out how Artis Energy’s RTIS® energy analytics platform can provide you with the visibility and insight to transform energy from a fixed cost into a distinct competitive advantage.