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Powering Up: Energy Storage 101, The Ultimate “Utility Player” for the Grid

Energy storage has quickly become a critical resource, supporting the growth of renewable power generation. In our latest Powering Up blog post, we’re explaining how energy storage brings value across a wide variety of needs, from supporting critical infrastructure and emergency services to enhancing companies’ competitiveness and resilience.

Powering Up: Energy Storage 101, The Ultimate “Utility Player” for the Grid

Feb 05 2025  |  10 min read

Energy storage has quickly become a critical resource, supporting the growth of renewable power generation. But energy storage also has other benefits for industries, governments, and grid operators. In our latest Powering Up blog post, we’re explaining how energy storage brings value across a wide variety of needs, from supporting critical infrastructure and emergency services to enhancing companies’ competitiveness and resilience.

Intermittent clean energy sources, like solar or wind power, can aid organizations and governments in meeting their sustainability and decarbonization goals. Working with renewable energy generation, energy storage can provide cost savings, grid and industry resilience, and reduced emissions.

A true “utility player,” energy storage can do a wide range of jobs both on the grid and onsite for organizations. In this blog, we’ll explain how energy storage can support and benefit companies, governments, grid operators, and the many customers and electricity users who depend on them.

 

Charging up, building up

While renewable energy sources like solar and wind can decrease reliance on fossil fuels, their energy output is predictable but not constant. Energy storage technologies like batteries and pumped hydropower can absorb excess energy from renewable resources during times of peak generation and inject that power back onto the grid at times of high demand or reduced production.

For example, at night when solar panels are unable to convert sunlight into electricity, energy storage systems can continue to deliver power stored earlier in the day. Storage solutions are allowing for a greater share of renewable in energy markets, bringing down both pollution and greenhouse gas emissions from the power consumers take from the grid every day. Battery storage costs – especially for lithium-ion chemistries – have continued to drop, making the flexibility that energy storage can provide accessible to more organizations.

 

The first grid-scale batteries, deployed in a parking lot at PJM headquarters!

The very first grid-scale battery storage was brought online in 2007 in PJM. Since then, battery storage has grown in the United States from half a megawatt-hour of capacity to 83,000 megawatt-hours of capacity as of the end of 2024, according to Wood Mackenzie. That’s enough storage to provide the daily needs of nearly 2.8 million American households. And that’s not including other forms of energy storage, like pumped hydropower.

Let’s look at how energy storage can help a wide range of organizations.

 

Supporting businesses and governments

Cut energy costs

Businesses that choose standalone energy storage systems can see savings on their utility bill. For example, if a company operates in a market that has time-of-use pricing, it can charge energy storage when prices are low and use that stored energy during peak hours. Some energy-intensive industries that have very high loads across the year – can reduce how much power they draw from the grid by injecting stored power at times of greatest energy use, significantly cutting annual energy costs by avoiding high “demand charges” from their utility.

Maximize the output of onsite renewables

In addition, energy storage systems paired with onsite renewable sources, like solar panels, can maximize or store output from these intermittent sources for use during higher price periods and reduce reliability on the grid, bringing further cost savings. Those savings can be invested into other sustainability initiatives to create additional environmental and/or cost benefits.

 

 

Support critical infrastructure

Many organizations are dependent upon reliable access to electricity to serve their clients and communities. In the cases of hospitals, fire and police departments and other critical service providers, power outages can mean the difference between life and death.

In the case of businesses, for high-energy manufacturing industries or organizations with remote operations, a power outage can bring work to a halt. Even short – seconds or sub-second – power interruptions can ruin production runs on manufacturing lines in industries where continuous operations are critical, like textiles or painting cars. Data centers operate 24/7, relying on backup power to prevent damage, service interruptions or loss to equipment.

Energy storage can provide uninterrupted power even when the grid goes down, minimizing any impacts from shifts in power quality or even blackouts. Storage paired with renewables or other generation can also ensure steady power for microgrids and islands that operate without a broader grid to provide power in an emergency.

Meet sustainability goals

Shareholders and governments are increasingly adopting and working towards sustainability goals, including net zero emissions. Energy storage can help reduce reliance on fossil fuel use, by helping organizations maximize the output of onsite renewables or work with renewable resources to provide “firmed” renewable energy to organizations working to power their operations with clean energy 24/7.

Surpass the competition

Lowering energy costs, meeting ESG targets, and increasing reliance on clean energy can give organizations an advantage over competitors who are slower to change practices and hedge against power and fuel prices. Adoption of renewables and storage solutions will make organizations more efficient and resilient in the face of potentially decreasing reliance on fossil fuels and/or price volatility. Businesses and governments that produce and store energy onsite can reduce energy costs and may even be able to sell excess energy to the grid. Investments in renewables and energy storage attract audiences and clients that care about sustainability and innovative solutions to climate change.

 

Ensuring reliability and resilience for electricity grids

Integrate renewable energy

Intermittent sources of energy like solar and wind – as well as newer types of loads, like electric vehicles and data centers supporting still-growing energy-intensive AI applications – can make it difficult for operators to maintain balance on the grid. Energy storage allows energy producers to capitalize on the growing adoption of renewable energy ensuring reliability.

Electricity is often called the world’s most perishable commodity, because it needs to be used in the instant it is generated.  Energy storage can ”firm” the output of intermittent resources by storing energy during times of overgeneration and supplying that energy to customers during times of greater demand.

 

 

Enhance grid resilience

Natural disasters like wildfires or floods, or equipment failures, can cause grid outages affecting vulnerable customers and infrastructure. In some cases, energy storage systems can help maintain uninterrupted power even during power disruptions.

Backup power that energy storage can provide to the grid can help recovery efforts from natural disasters and provide energy for hospitals or in-home medical care, or even simply heating or cooling for vulnerable populations when electricity outages can be life-threatening.

It can also provide “balancing services” for the grid – known as ancillary services – taking on excess power or injecting power to unexpectedly high demand, to cover any minute-to-minute or even second-to-second gaps between electricity supply and demand.

Solve transmission or distribution grid congestion

Congested transmission and distribution lines often can’t handle the influx of energy overproduction or excess demand during peak hours. Energy storage systems located along transmission or distribution lines can reduce the inefficiency of grid congestion. Battery storage located near high-demand areas can efficiently deliver energy and reduce line congestion without the need for costly infrastructure upgrades like new lines or substations. Batteries can also instantly respond to frequency instability and restore grid reliability in the case of fluctuations.

 

Reduce reliance on peaking plants

Although so-called peaking plants (typically fast-ramping natural gas plants) have provided necessary services during times of high energy demand, these plants are expensive to run and maintain, and are typically only used 5-10% of the year.

Energy storage projects can inject stored energy into the grid in seconds, without the need to add pipelines or access natural gas supplies. Also, because energy storage facilities have smaller footprints than typical power plants, it takes less time, permitting, and construction to install battery storage than it does to build a new peaking plant to meet growing energy demands. Some storage solutions can even provide black start services to help restart grid operations after a significant outage.

Reduce grid emissions overall

Energy storage is playing a critical role in reducing the carbon intensity of grid power overall. The more flexibility on the grid is provided by assets like energy storage, the more the grid can accommodate a greater share of renewable energy, which brings down the average emissions of power used on that grid. This can help regions and countries to reach towards their decarbonization goals.

Being at the vanguard of carbon emission reduction can help agile power providers lower costs, increase resilience, anticipate future policy changes, stabilize consumer costs, and enhance brand optics and recognition.

Storage systems are poised to balance a more decentralized, decarbonized grid, with accompanying cost savings, grid stability, critical energy supply, competitive advantage, and community resilience. As more customers seek clean energy alternatives, energy storage solutions will continue to grow in value and prevalence.

What are the right tools for these critical jobs? In our next post, learn more about energy storage technologies and the jobs they typically perform.