Energy Storage vs. Demand Side Response

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By Nick Heyward
17 January 2018

Full article published in The Energyst.

The Energyst recently surveyed 180 businesses with an interest in responsive energy. Nearly two-thirds said that they did not participate in Demand Side Response (DSR). Of those, 77% said that they would be interested in doing so if it did not affect core business. Other barriers to entry included a lack of businesses awareness, fear of low ROI and/or having unsuitable equipment.

Energy storage can overcome many of the perceived barriers to adopting flexible energy systems, often providing adequate levels of flexibility for large energy users, negating the need for DSR.

Cost benefit analysis
The capital cost of energy storage is a key factor for businesses. While using DSR services usually incurs some costs due to modifications to asset controllers, staff training and so on, it is significantly cheaper in comparison to a new storage system. However, purchasing a system outright is not the only way to adopt energy storage.
Financing options are now widely available that reduce or eliminate capital expenditure. Models vary, but many solutions involve a benefit share with the site
owner, using a proportion of the income generated to cover the cost of the asset over a minimum contract term. This allows site owners to unlock the enhanced benefits of energy storage at an equivalent or lower cost to DSR.
Fully funded solutions also pass on investment risk of the energy storage (e.g. uncertainty in tendered market revenue streams) to the parties best placed to manage it.

Continue reading this article in The Energyst.

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