What Is Commercial and Industrial Energy Storage? What Is It Used For?
These systems can be used to provide electricity when demand is greater than solar panel output, such as during power outages or at night. BESS systems are often battery-based and use electrochemical batteries like lithium-ion, lead-acid, or flow batteries.
Commercial and industrial (C&I) energy storage systems can help businesses manage their electricity costs and power quality. They can also help businesses increase their use of renewable energy sources.
Here are some C&I energy storage solutions:
Battery energy storage systems (BESS)
These systems can be used to provide electricity when demand is greater than solar panel output, such as during power outages or at night. BESS systems are often battery-based and use electrochemical batteries like lithium-ion, lead-acid, or flow batteries.
Energy management solutions
These solutions can be used in commercial buildings, industrial facilities, and residential homes. They can help reduce energy bills, improve energy efficiency, and meet sustainability goals.
Power conversion systems (PCS)
Also known as inverters, PCS are a crucial part of any energy storage system. They help maximize the use of the energy storage system.
Other types of energy storage include: Pumped hydroelectric, Compressed air, Flywheels, and Thermal energy storage.
Industrial and Commercial Energy Storage Systems
Industrial and commercial energy storage is a key application of distributed energy storage systems on the user side. These systems are characterized by the close proximity of distributed photovoltaic power sources to load centers. This setup not only enhances clean energy consumption but also reduces power transmission losses, contributing to the achievement of "double carbon" goals.
Structure of Industrial and Commercial Energy Storage Systems
Unlike large-scale energy storage and frequency regulation power stations, industrial and commercial energy storage systems primarily aim to leverage the price differences between peak and valley grid periods for return on investment. Their main load is to meet the power demands of the industry and commerce itself, maximizing self-consumption of photovoltaic energy or engaging in arbitrage based on price fluctuations.
The components of an industrial and commercial energy storage system include a battery system, Battery Management System (BMS), Power Conversion System (PCS), Energy Management System (EMS), transformer, rack, connecting cables, convergence cabinet, lightning protection and grounding systems, and monitoring and alarm systems. These systems are modular, allowing for flexible configuration of voltage and capacity based on specific needs.
Structure of Industrial and Commercial Energy Storage Systems
Industrial and commercial energy storage systems are typically designed as integrated units within a single cabinet. These systems have lower control requirements compared to energy storage power stations, and some Power Conversion System (PCS) products also incorporate Battery Management System (BMS) functionalities. In terms of Energy Management System (EMS), industrial and commercial energy storage primarily requires setting charging and discharging times for effective energy management, which is simpler than what is needed for energy storage stations.
However, as the number of large industrial users increases, industrial and commercial energy storage systems can be configured with capacities exceeding the megawatt (MW) level. In such cases, the system configuration closely resembles that of energy storage plants.
Architecture of Industrial and Commercial Energy Storage Power Plants
Industrial and commercial energy storage systems typically employ an AC-coupled configuration similar to that of energy storage plants, but with a smaller capacity and simpler functionality.
PCS inverters commonly used in these systems are often bidirectional, and small to medium-sized industrial and commercial energy storage systems are increasingly utilizing optical storage machines ranging from 50 to 100 kW. Unlike large-scale energy storage plants, the Energy Management System (EMS) for industrial and commercial applications does not need to consider grid scheduling requirements. Instead, these systems primarily focus on local power provision and only require a Local Area Network (LAN) for energy management and automatic switching.
Commercial and Industrial Energy Storage Business Model
The profit model for industrial and commercial energy storage primarily revolves around peak-valley arbitrage. This involves charging energy during off-peak hours when electricity rates are low and discharging it during peak consumption times, allowing users to save on electricity costs while mitigating risks associated with load-shedding and power restrictions.
As time-of-use tariffs improve, the difference between peak and valley electricity prices widens, enhancing the economic viability of industrial and commercial energy storage. Currently, there are two main business models for operating these systems:
1. User-Owned Systems: Commercial and industrial users can install their own energy storage equipment to directly reduce electricity costs. However, they must bear the initial investment and annual maintenance expenses.
2. Energy Service Provider Models: Energy service companies can assist users in installing energy storage solutions. In this model, the service provider invests in the construction and maintenance of energy storage assets, while users pay for the electricity consumed from these systems.
Additionally, user-side energy storage facilitates multi-scenario applications, including charging and switching stations, data centers, 5G base stations, port shore power, and heavy-duty electric trucks.
Specific Analysis of Profit Channels
New Energy Consumption
Photovoltaic (PV) systems are characterized by strong intermittency and volatility, often leading to mismatches between energy generation and consumption. When the energy produced by a PV system exceeds the load, the excess power is sent to the grid at lower rates. Conversely, if the PV output is insufficient, industrial and commercial users must purchase power from the grid, leading to reduced cost savings from their PV investments.
By integrating an energy storage system, surplus PV power can be stored for later use, allowing it to first supply the load before drawing from the grid. This approach smooths out power generation and consumption, enhances the utilization of generated PV energy, and maximizes cost savings for users.
Peak and Valley Arbitrage
One of the most effective ways to capitalize on an energy storage system is through peak and valley arbitrage. Users can charge their storage batteries during off-peak hours when electricity rates are lower. When demand is high, they can discharge the stored energy to meet the load, effectively shifting consumption from peak to off-peak times and benefiting from the differential in electricity pricing.
