Smarter energy management for commercial and industrial facilities

For many businesses, electricity costs are determined by more than the total energy consumed.

Commercial electricity bills may include charges based on how much power a facility demands from the grid during peak operating periods.

A commercial Battery Energy Storage System (BESS) can help manage these electrical peaks, store energy for later use and, when designed with the appropriate backup equipment, support critical operations during power outages.

At Stellr Solar, we evaluate battery storage solutions based on each facility's electrical demand, operating schedule, utility rate structure and resilience requirements.

1. Understanding energy charges and demand charges

Commercial electricity bills may contain several components.

Energy charges (kWh)

These reflect the amount of electricity consumed over a billing period.

Demand charges (kW)

These are based on a measure of the maximum electrical power demanded by a facility during a defined interval, subject to the applicable tariff.

Fixed and other charges

Utility bills may also include customer charges, riders, taxes and other applicable fees.

For example, a facility may consume relatively modest electricity throughout most of the day but experience a substantial demand spike when several large motors, refrigeration compressors or processing machines operate simultaneously.

That short period of high demand can influence the monthly electricity bill.

Not all commercial tariffs have the same demand-charge structure, and some businesses do not pay separately billed demand charges.

2. What is peak shaving?

Peak shaving is the practice of reducing a facility's maximum electrical demand from the utility grid.

A properly controlled battery system can discharge electricity during high-load periods, reducing the amount of power drawn from the grid.

Imagine a facility normally operating at 150 kW but occasionally reaching 250 kW.

If an appropriately sized battery supplies 50 kW during a peak event, the facility's grid demand could potentially be reduced from 250 kW to 200 kW during that interval.

The battery does not eliminate the facility's underlying electrical load. Instead, it supplies part of that load locally.

To produce meaningful demand-charge savings, the system must successfully manage the relevant peaks throughout the billing period.

3. How much could peak shaving save?

Consider a simplified example:

This assumes the full 50 kW reduction is achieved in every monthly billing period and directly reduces the applicable billed demand.

Actual financial savings can be lower or higher because of demand ratchets, tariff structures, battery charging costs, round-trip efficiency, operating patterns and other conditions.

The example is not a representation of a specific Nova Scotia Power tariff.

4. Battery power versus battery capacity

When evaluating commercial energy storage, two measurements are essential.

Power (kW) determines how much electricity the battery can supply at one time.

Energy capacity (kWh) determines how much energy is available for use over time.

For example, supporting a 50 kW peak for two hours requires approximately 100 kWh of usable energy before accounting for other design considerations.

A practical design must also account for battery efficiency, depth-of-discharge limitations, reserve capacity, battery degradation and operating conditions.

A battery that is large enough for a short demand spike may not be sufficient for extended emergency backup.

5. Can commercial batteries provide backup power?

Yes, when the system is specifically designed and equipped for backup operation.

A properly integrated BESS may be capable of supporting selected critical loads, such as:

• Refrigeration and cold-storage equipment.
• Essential lighting and communications.
• Security and monitoring systems.
• Selected production and process equipment.
• Critical computer and control systems.
• Other designated emergency or continuity loads.

However, installing a battery does not automatically provide backup power.

Backup functionality may require compatible inverters, transfer equipment, isolation controls, switchgear, protection systems and a suitable electrical distribution arrangement.

The expected backup duration depends on the power required by the supported loads and the available battery energy.

6. Solar, battery storage or a complete microgrid?

Businesses can consider several configurations.

Battery Storage Only

Designed primarily to manage demand peaks, time-of-use electricity costs or selected backup loads.

Solar + Battery Storage

Combines on-site renewable electricity generation with energy storage. The battery may support demand management, improved solar self-consumption and appropriately designed backup functions.

Solar + Battery + Generator

Can provide additional operational flexibility and resilience when properly engineered as an integrated system.

Generator integration is particularly relevant to facilities requiring longer-duration backup during extended outages.

Each configuration has different capital costs, maintenance requirements, electrical controls and financial benefits.

7. What determines the return on a BESS investment?

A financial assessment should consider:

• Twelve months or more of electricity bills.
• Interval demand data, ideally at the utility's billing resolution.
• Applicable demand and energy tariffs.
• Peak magnitude, duration and frequency.
• Required battery power and usable energy capacity.
• Charging and discharging efficiency.
• Equipment and maintenance costs.
• Expected battery degradation and warranty coverage.
• Potential tax incentives and financing.
• The financial value of backup power or avoided downtime, where quantifiable.

For sites without meaningful demand charges, a peak-shaving investment may have a different financial case.

8. Are tax incentives available for commercial batteries?

Certain qualifying stationary electricity storage equipment may be eligible for Canada's federal Clean Technology Investment Tax Credit, subject to the applicable technical and tax requirements.

Businesses should verify eligibility, labour requirements, ownership arrangements and eligible capital costs with their tax advisor.

Why work with Stellr Solar?

Stellr Solar evaluates commercial battery storage using a facility's actual electrical requirements.

Our approach considers the intended purpose of the system—whether that is reducing demand charges, increasing energy flexibility, supporting critical operations or integrating solar and generator equipment.

Reduce unnecessary electrical peaks. Improve energy flexibility. Prepare your facility for a more resilient energy future.

Contact Stellr Solar to discuss a commercial battery storage feasibility assessment.

Battery savings and backup capability are site-specific. Financial returns and uninterrupted power are not guaranteed. All proposed operating modes depend on the final approved design and equipment configuration.

Need Help or Have Questions?

Our team is here to support you throughout your solar journey.

Stellr Solar Customer Support

Email: info@stellrsolar.ca
Phone: 1-800-971-1295
Website: www.stellrsolar.ca

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