About Energy Storage

How energy storage benefits the electricity grid.

The majority of energy storage currently being installed on the electric grid is in the form of lithium-ion batteries. Battery technology has been around for many decades. From the AA alkaline batteries in our television remote controls to lead-acid batteries for cars, we are accustomed to having access to power without a grid connection or wires. Lithium-ion batteries are currently used in most modern cell phones and laptops.

In 2020, batteries are much more versatile and technologically advanced than just a few years ago, making some types available for large-scale stationary energy storage. The term “storage” simply refers to the ability of a battery to capture energy produced at one moment in time for use at a later time.

Why is energy storage expanding?

utility power lines

Growth of Renewable Energy

The majority of US electricity consumers live in a state or are served by a utility with a 100% clean energy goal in the coming decades. 

Solar and wind energy now represent nearly 10 percent of the overall electricity grid. As the contribution of renewable energy grows, utilities become more concerned about their “intermittency” on the grid. In other words, their supply is not always predictable due to weather variations.

Energy storage helps resolve this issue by capturing power when renewable energy sources are producing excess power such that it can be used later when needed. Plus, energy storage is much better for the environment than fossil fuel generation when charged using renewable sources as batteries inherently have zero emissions.

Lower Cost of Energy Storage

Energy storage, and specifically battery storage, is much cheaper today than even just a few years ago. The cost of lithium-ion batteries has decreased dramatically over the last decade. Batteries today cost about 10% what they did in 2010 and this trend will continue into the next decade.

This makes it more economical to install energy storage systems, whether they are located at a customer’s facility (behind-the-meter) or located at a substation to directly serve the grid (front-of-meter). Dimension focuses on front-of-meter applications for the communities we serve.

What benefits does energy storage provide?

energy storage near a utility substation

There are many ways to utilize energy storage to provide benefits to the local electricity grid. Depending on the size of the storage project and the technology, usage will vary. Here are some of the benefits:

Peak Power Supply

Utilities want to generate and procure the cheapest electricity possible to provide the greatest value to customers. However, there are seasonal and daily spikes in electricity usage that require utilities to spin up added power supply for a short period of time, such as on hot summer days. Energy storage can be used during these periods to serve demand spikes in a more affordable and sustainable way.

Frequency Regulation

The American electricity grid runs on alternating current (AC) that must operate within an accepted frequency range. Utilities must keep this frequency within a narrow band to prevent damage to electrical equipment. They do this by ramping generation assets either up or down. However, it can often take several minutes or longer to adjust some generation units that run on coal, nuclear, or natural gas, the traditional providers of this service. This creates a unique opportunity for utilities to use energy storage as it can react in seconds rather than minutes or longer.

Backup Power

Some electricity customers have critical loads that must have fully reliable electricity supply. If a grid outage occurs, these customers can utilize an on-site generator to power these loads. Now that energy storage is more affordable, facility managers are choosing battery storage to provide backup power instead of fossil fuel alternatives like a diesel generator.

Load Shifting 

Most electricity customers pay different rates for electricity depending on the time of day when it is consumed. This is referred to as a “time-of-use” rate. When the electricity rate is “on-peak” a customer will pay more for each kilowatt-hour of electricity than if the rate is “off-peak”. Energy storage allows customers to play “energy arbitrage” by buying (charging) power at low rates and selling (discharging) it at a time of higher rates.

Peak Shaving

Non-residential and increasingly residential customers pay for both energy consumed over time and peak power usage during the course of a billing period. Every 15 minutes, the utility meter provides these measurements to the utility. Even if usage peaks during just a single 15-minute period of an entire month, the customer will pay as if this peak usage occurred every 15-minute period. 
This drastically incentivizes customers to utilize energy storage for “peak shaving”. In this case, on-site energy storage will intelligently predict when a customer will use more power and respond by discharging electricity to prevent demand spikes.

Have land near a utility substation?


Our team is currently seeking land for energy storage project development. We pay top dollar for use of your land and provide a steady cash flow over the long term. Contact us for additional details and a quote.

matt mcmonagle headshot

Matt McMonagle
VP, Business Development and Energy Storage


The latest from Dimension Renewable Energy.


Getting started is easy.

Share via
Copy link
Powered by Social Snap