Understanding energy storage systems for commercial and industrial (C&I) applications

Lithium-ion batteries, especially Lithium Iron Phosphate (LFP/LiFePO4) type batteries have become the most popular type of energy storage system. They come with the following advantages:

• Safety: LFP batteries have the highest safety and acceptable energy density (both gravimetric and volumetric) for stationary applications.

• High-temperature operation: LFP batteries work well in high temperatures, making them a choice for countries around the equator and tropical countries.

• Low cost: LFP battery prices are considered the lowest in the Lithium-ion battery industry.

• Long life: LFP batteries for energy storage systems provide low power but very high life.

• Less critical minerals: Does not use critical minerals such as Cobalt and Nickel.

Energy storage systems for Commercial and Industrial (C&I) applications has been gaining traction for the following reasons:

Storing Renewable Energy

Solar PV system installations for commercial and industrial are already seeing good adoption, bringing a different set of problems. For places with no net metering option or with a gross metering option, the solar PV system owner tends to divert the additional solar energy generation into storage, preferably an LFP-based energy storage system.

Net metering is a system in which any excess energy sent to the grid can be adjusted in the energy utilization from the utility company, hence lowering the energy bills. Gross metering is a system in which any excess energy sent to the grid is paid a different value (usually lower than the buying price of energy from the utility company) compared to the energy taken from the utility company, sometimes leaving the PV system owners feeling they didn’t get a fair price for their energy export.

Many countries began with net metering to encourage solar PV system installations. When they see a rise in solar PV system generation, they tend to switch to gross metering to safeguard the utility company’s regular energy supplier’s commitment to take energy.

No net metering or Zero export is a system in which excess energy can not be sent to the grid. This situation leads to the PV owner looking for energy storage options.

Off-grid Use

Energy storage systems can enable off-grid applications to operate 24*7 when paired with renewable energy. The energy storage system must be sized well to include battery degradation year by year, maintain a healthy depth of discharge (DoD), and allow for auxiliary power consumption (including the cooling system and other components that consume power) during idle and discharge states. Similarly, renewable energy must be sized well to provide energy to compensate for losses during transmission and conversion to supply to loads, to the battery and back from the battery to the load, including efficiency losses of the battery during charge and discharge and auxiliary power consumption of the battery during its operation.

Supplying Power During Excess Demand

Energy storage systems can support excess energy demands for commercial and industrial applications when the power requirement increases. This situation arises for industries where the production is at maximum utilisation (which happens occasionally).

Energy storage system is an alternative for upgrading the sanctioned load for those who find it difficult to upgrade for the following reasons:

• Expensive upgrade: Enhancing the sanctioned load can be time-consuming and expensive in certain places. This makes it difficult for the user to source the excess power quickly.

• Unavailability of upgrade: Certain places do not have the option to upgrade sanctioned loads from their utility company. They are forced to look for other options, such as diesel generators or battery systems, as a long-term solution. A typical scenario is fast charging stations in remote locations.

• Need extra power only for a limited time: Certain companies might not require excess power regularly and do not want to upgrade their sanctioned load, pay higher charges, and look for storage options once in a while for excess power demand and use it for power outages.

Supplying Power During Power Outages

Energy storage systems are an ideal solution to ensure continuous power supply during power outages. It is a perfect replacement for a diesel generator if the power outage pattern is known.

High Peak Time Power Charges

Energy storage systems can reduce costs during peak usage times when electricity rates are higher than the cost of energy from off-peak time and the total cost of ownership of the battery, including the battery efficiency losses during its charge and discharge. The savings are even higher if the user has free energy from a solar PV system during excess generation.

Part 2 of Understanding Energy Storage Systems for Commercial and Industrial (C&I) Applications will focus on battery and bi-directional inverter (both non-hybrid and hybrid) technical details and system functionality details.

About the author:

Rahul Bollini is an R&D expert in Lithium-ion cells with 9 years of experience. He founded Bollini Energy to assist in deep understanding of the characteristics of Lithium-ion cells to EV, BESS, BMS and battery data analytics companies across the globe. Rahul can be reached at +91-7204957389 and bollinienergy@gmail.com.

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