Green

Is SolarCity the ‘energy company of the 21st century’?

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Some solar-energy companies have had a hard time in recent years, but SolarCity may look a little more promising.

That isn’t just because Tesla Motors CEO Elon Musk is the company’s chairman, either — though it can’t hurt.

Instead, says The Atlantic, it’s because the company is starting to use Tesla battery packs for energy storage, as part of its solar array systems–a move increasingly thought to be an essential part of the push towards greener electricity.

Energy storage offers the best way of regulating and buffering the inconsistent flow of energy from renewable sources like wind, solar, and tidal generation, ensuring supply will be sufficient to meet energy needs when demand is highest–and reducing wasted energy when it isn’t.

By charging the batteries when power generation — in this case, from photovoltaic solar panels — is at its highest, customers can make use of greener energy in the most efficient way.

As demand creeps up around peak times (which don’t necessarily match the peak times of generation), power can be used from the battery pack. SolarCity calls it ‘DemandLogic’, as it ensures customers avoid paying extra “demand charges” to their local utilities if they use power during the highest-demand hours.

SolarCity’s Tesla-based battery packs are ideal for this, with high capacity for maximizing storage. Battery packs can be customized for each business, but the goal is to store roughly 30 percent of the electricity generated by the solar array.

SolarCity CEO Lyndon Rive says DemandLogic could save commercial customers as much as 20 percent in demand charges.

There are other benefits too, such as emergency power should the grid go down in a storm. The backup battery power could be essential for keeping small businesses running if their external power source is knocked out.

It’s not all commercial, of course. Some homeowners in California have already started using Tesla packs, installed by SolarCity, to cover their peak energy usage by storing power from solar arrays on their rooftops.

Thanks to strong incentives–subsidies of 60 percent in California, writes The Atlantic – customers pay relatively little for the battery packs.

Tesla itself actually uses grid storage at some of its Supercharger sites, where solar-generated electricity generated actually outstrips demand from Model S customers visiting the DC quick-charging stations.

Existing electric utilities are less keen on the idea, predictably, but with the DemandLogic system they aren’t pushed out entirely. Businesses remain connected to the grid, and still draw much of their energy from it.

Rive says SolarCity is a “secondary provider” that can be viewed more as a cost-reducer than a sole energy provider.

SolarCity has big plans, however–aiming to become “the energy company of the 21st Century”.

Those don’t sound like the words of a company that wants to remain a “secondary provider”.

And as the idea of demand-based energy storage and solar arrays catches on, Tesla’s battery packs and SolarCity’s solar arrays may start to become a familiar (and cost-reducing) sight.

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This story originally appeared on Green Car Reports.