The symbiosis between solar energy and energy storage technology is driving an emerging market. Analysts predict a multi-billion dollar market will evolve in the US over the next several years, dominated by residential solar systems that use storage to provide power when the sun isn’t shining or during blackouts.
A leading solar installer – SolarCity – has identified another use for energy storage to help commercial building owners. Businesses pay large amounts of money to utilities for so-called demand charges, which are fees assessed for the maximum power levels they use during a billing cycle. These demand charges generally are much higher than usage charges for the amount of energy they consume. A few hours of intense demand during the month can totally dominate the electric bills of many businesses.
SolarCity has introduced a product called DemandLogic, which allows businesses to store energy generated from their solar arrays and use it during periods of peak demand, thereby reducing their consumption from the utility. Reducing these peaks could save the businesses substantial amounts of money.
Elon Musk, CEO of Tesla Motors, is the chairman of SolarCity and Tesla is providing the battery packs for the DemandLogic system. Several hundred customers have signed up for a pilot program in California, Connecticut and Massachusetts. Under 10-year service agreements, customers are guaranteed to have demand charge reductions, which are expected to run around 20%.
Conventional approaches to reducing electrical demand involve cutting back on operations. With technology like DemandLogic, businesses can reduce their electrical demand and still operate at full capacity. Tesla’s battery packs may revolutionize more than cars.
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SolarCity to Use Batteries From Tesla for Energy Storage
Photo, posted April 18, 2013, courtesy of Steve Jurvetson via Flickr.
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Earth Wise is a production of WAMC Northeast Public Radio.