Energy Independence (Part 1): Benefits and Challenges
Energy independence is a hot topic. The term means different things for individuals vs. organizations vs. nation-states. This 2-part series focuses on energy independence for organizations, exploring what it means, why it’s important, how to navigate common pitfalls, how to build a sound strategy, and the critical role of advanced energy storage solutions.
What is energy independence for organizations?
Energy independence is the ability of a business or institution to generate, manage, and use its own energy sources with minimal reliance on external energy suppliers or the power grid. The approach has become more popular as companies seek to increase resiliency, control costs, reduce their environmental footprint, and mitigate energy risks associated with factors outside their control, such as fluctuating energy prices, grid instability, or supply chain disruptions.
The benefits of achieving energy independence
Achieving energy independence requires upfront effort and investment. However, it offers many long-term advantages:
Cost savings and predictability
By generating and using your own energy, you lower reliance on utility providers and minimize your power expenses. You can avoid volatile energy prices that fluctuate due to market conditions, regulatory changes, or geopolitical factors, improving the predictability of your operating costs.
Operational resilience and continuity
Achieving energy independence enables you to continue operations even during grid outages or supply disruptions. You can prevent costly downtime and continue operations during blackouts or extreme weather events. By controlling energy sources and consumption, you’re more resilient against risks associated with supply chain issues or fuel shortages.
Environmental and sustainability goals
Generating energy through renewable sources reduces reliance on fossil fuels while helping you achieve carbon neutrality. The initiative will contribute to your sustainability goals and strengthen your environmental, social, and governance (ESG) performance to meet regulatory standards and enhance your corporate image.
Improved control and efficiency
Advanced energy management systems and data analytics allow you to monitor and optimize energy use in real-time to reduce waste and improve efficiency. Meanwhile, self-generated energy reduces the risks associated with energy supply dependencies and regulatory constraints while improving agility.
Pitfalls on the journey to energy independence
Achieving energy independence requires substantial planning. Organizations must address various obvious and non-obvious factors that might derail their initiatives.
Heavy reliance on a single renewable source
Most renewable energy sources have varying power generation capabilities due to weather, seasonal changes, and other local factors. If you put all your eggs in one basket and lack sufficient energy storage capacity, you may not achieve the planned level of self-sufficiency.
Insufficient energy storage
Even if your solar panels or wind turbines generate enough energy to meet average daily needs, you must implement energy storage solutions to store surplus energy to maintain operational continuity when production is low or consumption is unusually high.
Dependence on backup generators using fossil fuels
Backup generators help bridge the gap during emergencies but don’t always guarantee an uninterrupted energy supply. For example, diesel fuel may be in short supply or costly during extended outages or prolonged supply chain crises. Relying on fossil-fuel-based backup power could make you vulnerable to fuel shortages or price spikes.
Lack of autonomous control
You can’t operate independently during a power outage if you rely on the local grid for electricity distribution (i.e., your energy generation system feeds into the grid). Without a microgrid, you risk eroding your resiliency and independence.
The illusion of sustainability
Today’s storage solutions use monolithic battery packs and battery management systems (BMSs) with limited monitoring and analytics capabilities. Many operators toss out old packs with most of their capacity intact and replace them with new ones to avoid unplanned downtime. Moreover, they must replace an entire pack even if just one cell fails.
Since battery production and disposal have significant environmental impacts, these practices increase a system’s long-term environmental footprint and reduce its sustainability appeal.
Poor energy management capabilities
Power generation is just one part of the equation. Without intelligent monitoring and load-balancing capabilities, you risk consuming more energy than you produce or failing to distribute power to where it’s needed. The imbalance may cause inconsistent energy availability and grid reliance during peak hours.
Overestimation of energy generation capacity
A system designed to meet energy demand based on annual energy consumption averages may not be sufficient to accommodate seasonal fluctuations (e.g., less solar available during winter) and peak demand periods when power demand exceeds generation capacity.
Security breaches from IoT devices and smart systems
Smart monitoring and energy management involve many sensors that connect to an organization’s IT infrastructure. However, many lack robust security measures to prevent threat actors from exploiting their connections to the company network to infiltrate the system.
>> Download our Battery Security white paper.
Pave the way to energy independence
Achieving energy independence involves many disciplines and deep expertise. Energy storage plays a critical role and requires an approach combining a strategic understanding of business requirements and advanced battery technology to ensure success.
Our Battery Advisory Services combines practical strategic and technical advice with out-of-the-box thinking to help organizations solve their trickiest energy storage and distribution challenges. Learn more and get in touch to create a roadmap that meets your business objectives and gives you a competitive advantage.
