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Are battery energy storage systems worth the investment?

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14 Apr, 2024

This post was originally published on Power Sonic

As the world transitions towards sustainable energy practices, the role of battery energy storage systems is becoming increasingly vital. These systems not only offer environmental benefits but also provide economic advantages for installers, distributors, and property owners. Let’s explore the value proposition of battery energy storage systems in each of these contexts.

FOR INSTALLERS:

The expansion of battery energy storage systems paves the way for innovation and market growth, offering installers a plethora of advantages, such as:

Diversification of Services: By incorporating battery energy storage installations into their services, installers can diversify their offerings. This not only expands their customer base but also positions them as versatile and capable providers in the renewable energy sector.

Increased Demand: The growing popularity of renewable energy and the desire for energy independence among homeowners has led to increased demand for battery energy storage systems. Installers who offer these services are likely to attract more customers and projects.

Alignment with Sustainability: Many homeowners installing energy storage systems are environmentally conscious and seek installers who share their values. By promoting clean energy solutions and reducing carbon footprints, installers can attract environmentally conscious customers and contribute to sustainability efforts.

Competitive Advantage: Offering battery energy storage installations gives installers a competitive edge in the market. It allows them to stand out from traditional electrical contractors and attract customers who prioritize energy efficiency and renewable technologies.

Adaptation to Market Trends: The renewable energy market is rapidly evolving, with battery energy storage playing a significant role. Installers who adapt to these market trends and offer cutting-edge solutions stay ahead of the competition and remain relevant in a changing industry.

FOR DISTRIBUTORS:

Distributors

Distributors play a crucial role in bridging the gap between manufacturers and installers. For distributors looking to expand their product offerings and revenue streams, battery energy storage systems present a compelling opportunity. Here’s why distributors should consider investing in these systems:

Diversification of Product Offerings: Adding battery energy storage systems to their product catalog enables distributors to diversify their offerings. This diversification is particularly advantageous in a rapidly evolving market where sustainable energy solutions are gaining popularity.

Seize an Expanding Market Opportunity: The demand for battery energy storage systems is on the rise as more homeowners and businesses prioritize renewable energy and energy independence. Distributors can tap into this high-growth market segment and capitalize on the increasing interest in sustainable technologies.

Enhanced Revenue Streams: Offering energy storage solutions can create new revenue streams for distributors. These systems often come with higher price points compared to traditional electrical components, leading to increased profitability per sale.

Competitive Advantage: Embracing battery energy storage systems gives distributors a competitive edge in the market. Being among the first to offer innovative energy solutions can attract customers who are looking for reliable and cutting-edge products.

Adaptation to Regulatory Changes: Many regions are implementing regulations and incentives to promote renewable energy adoption, including battery energy storage. Distributors that adapt early to these regulatory changes can position themselves as leaders in compliance and industry standards.

FOR PROPERTY OWNERS:

Property Owners

Trusted and reliable battery energy storage systems offer a transformative opportunity across multiple fronts. For homeowners, they provide significant benefits, including:

Energy Independence: Property owners can store excess energy generated from renewable sources like solar panels and use it during times of high demand or grid outages. This reduces reliance on the grid and provides an uninterrupted power supply, enhancing resilience during emergencies.

Cost Savings: Battery energy storage allows property owners to take advantage of time-of-use pricing and peak demand shaving. They can store electricity during off-peak hours when rates are lower and use it during peak hours when rates are higher, reducing overall electricity costs.

Environmental Impact: Using battery energy storage in conjunction with renewable energy sources helps reduce carbon emissions and environmental impact.

Grid Stability: Battery energy storage systems can contribute to grid stability by balancing supply and demand. They store excess energy during periods of low demand and release it during peak demand, reducing strain on the grid and minimizing the risk of blackouts or disruptions.

Backup Power: During power outages, battery energy storage systems provide backup power, ensuring essential appliances and systems remain operational.

Increased Property Value: Installing battery energy storage can increase the resale value of a property. Energy-efficient features, including energy storage systems, are attractive to environmentally conscious buyers and can differentiate a property in the real estate market.

Flexibility and Control: Battery energy storage gives property owners greater control over their energy usage. They can monitor energy consumption, optimize usage patterns, and adjust settings to maximize efficiency and savings.

Are battery energy storage systems worth the investment?

The growing significance of battery energy storage systems in our transition towards sustainable energy practices cannot be overstated. These systems not only deliver substantial environmental benefits but also unlock economic advantages for installers, distributors, and property owners. From enhancing energy independence and resilience for property owners to fostering market growth and innovation for installers and distributors, battery energy storage systems are proving to be a wise investment. As we continue to prioritize clean energy solutions and adapt to regulatory changes, embracing these technologies opens up new avenues for efficiency, profitability, and environmental stewardship in the energy sector.

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Energy Efficiency as an Imperative Climate Strategy

Energy Efficiency as an Imperative Climate Strategy

02 Feb, 2025

With mandatory climate statement disclosure rolling out in Australia, businesses need to start reporting on their emissions and sustainability plans for the future. As companies begin assessing the relevant risks and opportunities related to various climate scenarios, energy efficiency presents itself as an immediate climate-strategy with long-term benefits.

Commencing 1 January 2025, businesses that meet two of the three conditions — more than 500 employees, gross assets above $1 billion or $500 million or more in consolidated gross revenue — are required to lodge a climate statement, which discloses their climate-related plans, financial risks and obligations. As part of the gradual roll-out, by 1 July 2027, businesses that meet two of these conditions — more than 100 employees, gross assets above $25 million or exceeding $50 million in consolidated gross revenue — will also be required to report.

This climate statement will need to include the company’s sustainability governance, climate risks and opportunities, including those physical and transition related. They will also need to disclose their Scope 1 and 2 emissions, strategy to decarbonise, and conduct scenario analysis on the short, medium and long term impacts on the business. By the second year of reporting, businesses will also be expected to report on Scope 3 emissions.

Scenario analysis will be based on various assumptions of the state of the climate, one of which includes a possible future where global temperature has increased 2.5°C or more. They will be required to share their climate strategy and steps they are taking long-term in preparation for this scenario.

Common themes within climate strategies will include switching to renewable energy sources, electrifying fleet vehicles, purchasing carbon credits, and carbon capture and storage. Many of these methods look at reducing emissions through the energy source, or targeting the carbon aspect directly; however, climate strategies can also include reducing the amount of energy used. By investing in more energy efficient equipment, sites can maintain production whilst using less energy and producing less emissions.

When increasing energy efficiency and reducing energy consumption first, businesses will see short-term impacts; however, in the long term, they are also improving their foundation for an energy transition. Assuming no other changes, higher energy efficiency can lead to decreased energy demand, allowing for reduced system requirements when specifying and planning for self-generation or energy costs.

To understand what opportunities are available for upgrading to more energy efficient equipment, businesses can start with an energy audit to understand how energy is being consumed across site. Energy audits, like the ABB Energy Appraisal, can provide a roadmap for where and how equipment can be upgraded for the best energy saving potential. An energy audit identifies areas that can be immediately improved with existing equipment on the market, so there is no need to wait for the commercialization or development of more sustainable technology. Going beyond just changing all lights to LEDs, efficiency recommendations may include areas where variable speed drives can be added to control motor speed or upgrading from an IE3 motor to an IE5 ultra-premium efficiency or IE6 hyper-premium efficiency motor to reduce energy losses by 40% or more. This area can often be overlooked on sites as the Minimum Energy Performance Standard (MEPS) in Australia for motors is just IE2.

Mostly used in pumps, compressors, conveyors and fans, motors may seem like a minor part of a site; however, with 45% of the world’s electricity converted into motion by industrial electric motors, there are many opportunities for energy savings. In fact, a recent survey commissioned by ABB IEC Low voltage motors, showed that 92% of surveyed businesses in Australia recognize the important role of electric motors in achieving sustainability targets. In this same survey, participants ranked a reduction in operating cost as a more important driver for investing in energy efficiency than lowering their organization’s emissions. This is because upgrading to newer, more efficient equipment provides benefits beyond just emission reduction. For example, ABB’s Synchronous Reluctance (SynRM) Motors, available in IE5 ultra-premium efficiency or IE6 hyper-premium efficiency, use no rare earth metals or magnets. Running quieter and with bearing temperatures reduced by up to 15°C and winding temperatures by up to 30°, SynRM motors have longer maintenance periods, superior reliability, and contribute to a better operational environment.

Looking ahead, upgrading to an IE5 SynRM motor also provides more visibility into Scope 3 emissions, as SynRM motors meet ABB’s circularity criteria and transparency on environmental impact is provided through Environmental Product Declarations (EPDs).

By requiring companies to disclose their climate information, these new legal requirements are opening the door and facilitating more internal discussions on environmental impact and emission reduction. Whilst mandatory climate reporting is only required of large business entities this year, the progressive roll-out and Scope 3 emission reporting requirements mean that businesses of all sizes in Australia will be impacted by these new requirements. As businesses become more conscious of how sustainability should be integrated into their operations and finances, there is no better time to start investing in energy efficient solutions.

For more information, click here.

Image credit: iStock.com/denizunlusu

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