Users can meet their internal electricity needs by configuring industrial and commercial energy storage, using the difference between peak and off-peak electricity prices to reduce operating costs. Energy storage can also serve as a backup power source during unexpected outages. When combined with photovoltaics, it can maximise on-site consumption of solar generation and improve the use of clean energy.
1. Improve photovoltaic self-consumption
Photovoltaic generation is intermittent and variable. When generation exceeds on-site demand, the excess electricity is often exported to the grid at a lower price. When photovoltaic output is insufficient, industrial and commercial users must purchase electricity from the grid. Adding an energy storage system allows surplus photovoltaic power to be stored and supplied to the load later. By balancing generation and consumption, energy storage improves photovoltaic self-consumption and helps users obtain greater value from the electricity they generate.
2. Peak-valley arbitrage
One of the most direct ways to create value with energy storage is through peak-valley electricity-price arbitrage. Users can charge batteries at lower off-peak prices and supply the load from storage during peak periods. This shifts demand away from peak hours, supports peak shaving and allows system owners to benefit from the price difference.
3. Demand management
China adopts a two-part electricity-pricing system for large industrial users with transformer capacity of 315 kVA or above. The energy charge is calculated from actual electricity consumption, while the basic charge is calculated from transformer capacity or maximum demand. After an energy storage system is installed, it can monitor transformer load and discharge when real-time power approaches the demand limit. This reduces peak transformer output, helps keep demand within the contracted limit and can lower electricity costs for industrial and commercial parks.
4. Dynamic capacity expansion
When an industrial or commercial user’s existing distribution capacity is insufficient, the energy storage system can discharge during short periods when power demand exceeds transformer capacity. This helps meet load requirements while reducing transformer-upgrade investment and potentially delaying capacity expansion.
5. Demand-side response
Demand response occurs when electricity users reduce or shift load in response to higher wholesale prices, grid-reliability risks, incentive notices or price signals from the power supplier. Energy storage helps users respond without unnecessarily interrupting operations by supplying part of the load during the requested period.