Method for Analyzing the Value of Distributed Energy Storage at the Facility Level – Step 1b: Electricity Issues

Figure 1 of the previous post (Step1a: Current Energy Needs) shows the current step in the evaluation methodology. After understanding the current electricity consumption at the facility the next step is to understand if there are any adverse conditions, with regards to energy consumption, that could be rectified by deploying energy storage at the facility. Understanding the energy needs at the facility and any electricity issues experienced at the facility, is critical to selecting the energy storage application that would be most profitable at the facility. Understanding the most appropriate energy storage application will, in turn, help to select the most correct energy storage device.

When I first performed this analysis, the facility in question housed a software company. Interestingly, though they were charged a considerable demand charge on their electricity bills they did not pay a different rate for their peak energy consumption vs their off peak consumption. It should be noted that this uniform energy billing was very uncommon in the area. The facility also experienced a statistically anomalous lack of power quality events (especially when compared to previous facilities that housed the same company). Another important element, is that the facility did not deploy onsite renewable energy generation.

Without a difference in Peak vs. Off-Peak billing, utilizing energy storage for the Time of Use (TOU) Energy Cost Management application would be of little value at the facility. Without significant power quality events, power quality applications of energy storage were also of little value. Clearly without on-site renewable energy deployment, the application of energy storage to smooth out variability in renewable energy generation was also not important. At this facility, in its current state, only Demand Charge Management had the potential to be a valuable additional energy storage application.

I say additional energy storage application because as a software company, the facility housed several server rooms which demanded 100% reliability. Even though the grid supplied electricity was considered highly reliable, this demand for 100% reliability required that backup diesel generators be deployed. These generators could produce electricity almost indefinitely (provided a constant supply of diesel fuel) but they had a start-up time of roughly 15 seconds. To ride through the time between a blackout from the utility and the availability of electricity from the backup generators the facility used energy storage in the form of six flywheels in a blackout application.

With an understanding of both the energy needs and energy issues at the facility one can understand the most appropriate applications of energy storage at a facility. Understanding the appropriate application is the first qualifying step for selecting an energy storage device that is appropriate for the facility. Next we will look at other things that must be considered to select an appropriate energy storage device so that the device can be evaluated to understand the value of its deployment at the facility level.