First public survey of utility rates details economic potential for
commercial behind-the-meter battery storage market
Table: A summary of demand charges for the states with the
highest utility demand charge rates in the U.S. (NREL)
The U.S. Department of Energy’s National Renewable Energy Laboratory (NREL) and Clean Energy Group (CEG) have released the first comprehensive public analysis detailing the potential size of the commercial behind-the-meter battery storage market in the United States.
NREL analyzed over 10,000 utility tariffs in 48 states, finding that more than five million of the 18 million commercial customers across the country may be able to cost-effectively reduce their utility bills with battery storage technologies.
These findings, grouped by utility service territory and state and illustrated in a series of maps and tables, are presented in NREL and CEG’s white paper, Identifying Potential Markets for Behind-the-Meter Battery Energy Storage: A Survey of U.S. Demand Charges.
The analysis determined that economic opportunities for storage exist not only in first-mover states like California and New York, but also across the Midwest, Mid-Atlantic, and Southeast. For example, tens of thousands of commercial customers in Georgia, Alabama, Kentucky, Michigan and Ohio may be subject to utility tariffs with sufficiently high demand charges to make storage a viable economic investment. Anticipated future declines in battery storage costs would enlarge the market potential in these and other states.
“With this analysis, we have identified the areas where customers have the greatest potential to benefit from investments in battery storage,” said Seth Mullendore, coauthor of the paper and a project director at CEG. “Utilities know where these opportunities exist, and now the rest of us have that information too.”
Nearly all medium to large commercial customers in every state are subject to utility demand charges, yet customers often do not understand how these charges are structured or accounted for.
For more information about demand charges, see the accompanying fact sheet.
The charges affect private and nonprofit businesses, as well as a wide array of additional customers, including community facilities, public buildings, and multifamily housing properties. In many cases, these demand charges can comprise anywhere from 30 to 70 percent of a customer’s utility bill.
NREL and CEG will host a webinar on Tuesday, September 19th to discuss the findings of the report. Authors Joyce McLaren and Seth Mullendore will present their research and answer questions from the audience. For more information on this free webinar and to register, click here: Identifying Potential Markets for Commercial Behind-the-Meter Battery Storage