All About Battery Storage For Commercial Energy

As renewable energy becomes more common, battery storage becomes more important. This applies on all scales, from individual homes to commercial operations and grid scale projects.  

With more businesses looking to prioritise sustainability and lower their carbon footprint, the adoption of battery energy storage systems (BESS) is a key cog. Battery storage will help the transition to cleaner energy thanks to its ability to store energy generated by renewable energy sources, such as solar and wind power, for later use in the commercial energy mix. 

This article will explain all about storing energy in batteries on a commercial level. 

What are battery energy storage systems (BESS)?

BESS are an advanced form of technology, allowing the storage of electrical energy in rechargeable battery units for later use. Lithium-ion batteries are by far the most common and efficient battery for commercial storage, although other types of storage batteries exist too.

Most commonly, battery storage is used alongside renewable energy power generation. Some commercial facilities have invested heavily in solar panels to power their operations and large PV arrays can generate a lot of electricity at peak times.

Depending on the business type, not all of this energy is always used straight away. Without battery storage, this gets sent to the grid. However, it makes both commercial and environmental sense to shuttle any excess energy generated into battery storage to use later on. 

Compared to other energy storage technologies, such as pumped hydro or compressed air storage, battery storage offers several advantages. They can help businesses reduce their carbon footprint and cut down on energy costs. BESS also have fast response times, allowing them to quickly absorb or release energy as needed. Even more, BESS are highly scalable and can be used over a wide range of size capacities.

Types of BESS projects

You can categorise BESS projects into two main areas:

• Front-of-the-metre (FOM)
• Behind-the-metre (BTM)

FOM are your grid-scale battery storage systems and are connected directly to the distribution network. Some can power hundreds of thousands of homes for a number of hours. These projects are typically owned and operated by utility companies and power producers.

BTM battery storage is installed on the customer side. These serve the energy needs of commercial facilities and homes. BTM systems help businesses to manage their energy costs by reducing peak demand charges and maximising the use of on-site renewable energy generation. 

How does commercial energy storage work?

Commercial battery energy storage systems work by storing electrical energy during periods of low demand or high generation and releasing it when needed. 

At the heart of a commercial BESS is the battery pack, usually made up of lithium-ion cells. The inverter converts the stored DC electricity into AC electricity, which is used by the grid and the facility’s electrical appliances. The inverter also controls the flow of power between the batteries and the connected system.

Key to the system is the control centre or battery management system (BMS). This monitors and controls the performance of the battery pack. It continuously tracks key parameters such as voltage, current, temperature and state of charge, ensuring that the batteries operate within safe limits. The BMS also uses high-tech charge balancing algorithms to maintain the health and longevity of the individual battery cells. With this, it’s thought that a good storage battery can last 15 years. 

The charging and discharging cycles of the battery are managed by the energy management system. This optimises the battery based on energy prices, demand patterns and grid conditions. The idea is that your commercial battery will charge during off-peak hours when electricity prices are lower or when on-site renewable generation, such as solar panels, is producing excess energy. When energy demand peaks or electricity prices rise, the stored energy is discharged to offset the power consumption or exported to the grid.

Current state of BESS in the UK

The UK has seen significant growth in BESS in recent years, including commercial energy storage projects. As of 2023, the installed capacity of battery storage in the UK was at 3.5GW. As more projects come online, this capacity is expected to expand significantly in the coming years, with the aim to hit 30GW in storage by 2030.

According to recent data, there are over 1,000 BESS projects in the planning, construction or operational stages. The scale of these projects is also increasing as the technology advances. On a national front, it’s being driven by the UK’s ambitious decarbonisation targets and the increasing integration of renewable energy sources. 

For commercial battery storage, it’s good news. As battery storage technology advances and production increases, prices are decreasing, making it increasingly cost-effective for businesses to invest in.

Factors driving the growth of commercial battery storage

Several key factors are driving the growth of commercial BESS in the UK. One of the most significant drivers is the declining cost of battery technology. 

Over the past three decades, the cost of lithium-ion batteries has decreased by an impressive 97%. In the last five years alone, costs have fallen by 13%. battery prices continue to drop, the economic viability of BESS projects improves, making them more accessible to businesses. Read up on more battery market trends here.

Government support and policies have also played a role in fostering the growth of commercial BESS in the UK. Initiatives such as the LODES (Long Duration Energy Storage) competition, which provided £69 million in capital funding to support the development of innovative energy storage technologies, have helped to stimulate investment and innovation in the sector.

The increasing demand for clean energy and decarbonisation is another major driver. As businesses face pressure to reduce their carbon footprint and meet sustainability goals, the adoption of renewable energy sources and energy storage solutions has gained momentum. BESS enables businesses to maximise the use of on-site renewable generation, reduce their reliance on fossil fuels and play their part in the transition to a low-carbon economy.

Lastly, the rapid growth of electric vehicles (EVs) is expected to have a significant impact on the demand for electricity and the need for energy storage. This is relevant for businesses too, as many are going down the EV route thanks to the cost savings and tax benefits associated with it. 

Benefits of commercial energy storage

The adoption of BESS offers a range of benefits for commercial energy storage, including:

• Cost savings – done by avoiding peak energy prices and load shifting. By storing energy during periods of low demand and lower electricity prices, businesses can then use this stored energy during peak hours when prices are higher.
• Back-up power – In the event of a power cut, a commercial BESS can supply stored energy to keep critical systems and operations running, minimising disruption and financial losses. This is particularly important for businesses with sensitive equipment or processes that require a continuous power supply.
• Integrate renewable energy – Batteries allow for the integration of renewable energy sources into commercial energy systems. By storing excess renewable energy generated during periods of high production, businesses can maximise the use of their own clean energy and reduce their reliance on the grid. This helps to lower their carbon footprint and contribute to the broader transition to a sustainable energy future.

Choosing the right battery storage for your commercial energy needs

When selecting a commercial battery storage system, you need to consider a few different factors.

The first step is to assess your energy consumption patterns and storage requirements. This involves analysing your daily, weekly and seasonal energy uses, as well as identifying any essential loads that require backup power. This information will help determine the appropriate size and capacity of the BESS.

Although there are different types of battery storage, lithium-ion has the most advantages. It has high energy density (meaning it doesn’t take up a lot of space for the energy it provides), has a long cycle life and declining costs. If you already have solar panels, battery storage can be retrofitted in no problem. 

As a business, it has to make sense financially. Weigh up the initial costs of equipment and installation, as well as the cost savings and potential revenue streams over the system’s lifetime. In the long run, it should work out as a positive financial investment alongside a good environmental choice.