October 24, 2017
One of the most frequent questions I get from customers is about the potential of battery storage systems to maximize savings from a solar project. I thought I would provide an example of how an energy storage system (ESS) can help optimize your savings from solar.
Electricity bills are made up mainly of two key components: energy charges and demand charges. Energy charges are determined by applying a $/kWh rate to every unit of energy consumed from the grid and recorded by your utility meter during a billing period. Demand charges, by contrast, measure your ‘high water mark’ grid demand in a given month, so turning on heavy machinery or HVAC even for 15 minutes can increase your demand charge for the whole month.
Over the past 10 years, demand charges have been rising faster than energy charges, with an annual increase of 3%-10%. Demand charges typically make up 30%-50% of our customers’ utility bills.
An integrated solar PV system and energy storage system (EES) can maximize total utility bill savings – both energy charges and demand charges. California’s recently reopened Self Generation Incentive Program (SGIP) helps customers install ESS and save on their energy bills. The SGIP program will provide a cash rebate equal to ~35% of the battery costs, along with the availability of a 30% tax credit and 5 accelerated MACRS schedule. Your net is probably 10 – 15 cents on the dollar with over 80% returned in tax benefits and rebates. SGIP incentives can amount to hundreds of thousands of dollars on a large ESS.
CalCom is a leader in integrating energy storage with PV to maximize savings for our customers. We have industry expertise and partnerships with leading suppliers to design and install an ESS that will reduce your demand charges, complementing savings from your PV system to maximize your total energy savings.
Storage will also play a key role in helping you prepare for future changes to utility time-of-use rates, as well as further increases to demand charges. If you’re ready to move forward with a PV System and ESS, CalCom Solar will prepare an SGIP application on your behalf. If awarded the rebate money, there are several steps to meeting SGIP requirements and claiming your incentive; CalCom Solar will assist you throughout this process.
To find out how your farm, water district or other California business can maximize your solar savings with an EES, feel free to contact email@example.com
Dylan Dupre, CEO