Solar and energy storage set to bloom

October 15, 2015

Managers of commercial facilities are looking for more cost effective ways of using energy, and it's beginning to look like they've latched on to one promising strategy, solar and energy storage.

Renewables, electricity from solar panels or wind turbines, are growing and while this can reduce energy costs, building managers still require back up power and resiliency in case of power interruptions or if the sun doesn't shine. Even with zero energy buildings, facilities are still connected to the grid. Energy storage allows facilities to avoid connecting to the grid when electricity is most costly. Energy storage helps avoid peak demand charges that can make up to 70% of an electric bill. According to the Washington Post, "energy storage takes away the need to use electricity immediately, giving flexibility in when you use electricity." Once just a bit player, energy storage is now on the verge of becoming a major player in the energy technologies sector.

​Solar and energy storage, changing the game
Energy storage was an integral part of solar systems in the 1970s but as incentives for solar grew and deregulation pushed incentives away, energy storage became marginalized. Today, energy storage is a small part of the overall market but getting to the forefront in a significant way. High penetrations of renewables such as solar require energy storage to buy up excess power. The resurgence of energy storage as it relates to solar stands to change the energy economy. In fact, Tom Werner of Sun Power predicts that thanks to greater adoption of energy storage, "in the next five years, customers are going to decide what they pay the utility," according to a story featured in GreenTech Media.

With solar and energy storage combined, businesses will have greater control over which energy source they use and when they use energy. During the daytime, when the sun isn't shining, business can go to the grid and use gas, coal, nuclear or renewables and pay hefty demand charges or alternatively they may rely on less expensive on-site stored energy to keep operations going.

Photovoltaic energy storage to reach tipping point
The photovoltaic energy storage market is expected to skyrocket following renewable energy's rapid growth. In 2012, the commercial market accounted for just 3.2 megawatts. But by 2017, that same sector is expected to grow to 700 times, according to IHS Research, to 2.3 gigawatts, instantly turning the market into a titan in the field.

Solar Photovoltaic (PV) energy with energy storage looks to be a reliable source of power for businesses in the years ahead. Through the use of semiconductors, solar panels can convert the sun's energy into electricity, which is then plugged into the grid and used to power facilities. By adding energy storage, solar PV can keep providing power continuously.

Ice thermal energy storage a sleeping giant
One energy storage technology that combines with solar, thermal energy storage, is expected to see over 18 percent annual growth through 2019, according to the Global Thermal Energy Storage Market 2015-2019 report, making this storage technology too influential to ignore. This growth, is due to such factors as growing global demand for uninterrupted power and increased electrical disturbances in various unreliable grids. Rising energy prices also play a vital role. Managers of commercial businesses are turning to ice thermal energy storage systems that supplement their solar strategies to reduce peak demand and reduce energy costs.

CALMAC, a New Jersey based manufacturer selling in over 50 countries is considered one of the key players, according to the report. Though ice thermal energy storage makes up only 1% of the HVAC market, accounting for 500MW around the world, the technology is poised to heat up. The rise of solar capacity should underpin ice storage growth. Take for example, one U.S. school district that, generates some of its own solar power and uses energy storage to help reduce peak energy consumption by over 20%.

Energy storage impacts industry as interest swells
There is an expanding network of businesses interested in solar with energy storage. Previously, energy storage was a niche curiosity restricted mainly to HVAC systems in large commercial buildings and schools, however as interest in green building grows and renewable energy develops, more businesses are taking an interest. Energy storage of all types is entering the marketplace. McKinsey estimates the economic impact to be as much as $635 billion (USD) by 2025, according to a report in Fortune.

Even utilities are interested. At the moment utilities must building extra capacity just to meet occasional peaks. The U.S. uses typically less than 30% of capacity. With more energy storage on the grid, utilities save on capital costs and smooth out frequency variations. Energy storage is win-win for everyone, consumers and producers alike.