Battery Storage Explained in 1,000 Words (and 3 Pictures)

Everything You Need to Know About Commercial Solar Battery Storage in 1,000 Words (and 3 Pictures)

It’s easy to see why excitement around commercial solar battery storage keeps growing with each passing month. As the price of utility power continues to rise – and environmental compliance becomes increasingly important – more companies are taking a closer look at how battery storage can dramatically lower their monthly energy bills, especially when combined with solar.

The batteries behind solar storage

First, let’s talk about the batteries typically used in commercial solar energy storage. With the exception of their size and the software used to manage them, the batteries you’d use to deliver solar power to your organization are very similar to the ones you’d find in a cell phone, cordless drill, or electric car.

Just like in those devices, most of the battery storage systems in large-scale commercial settings use lithium-ion chemistry and are about the size of a refrigerator (or several refrigerators, depending on how much power you need). These battery storage systems get charged up (in this case, from energy produced by solar panels) and store power, then discharge that power whenever it’s needed.

Financial benefits of battery storage

As you probably know, commercial utility customers pay for the power they use (measured in kilowatt-hours, or kWh) and demand charges (measured in kilowatts, or kW), based on their highest usage within a billing cycle. This means an organization is billed for spikes in usage beyond the number of kilowatt-hours they use, which could result in hundreds if not thousands of dollars every month in added costs. In some states, these demand charges make up more than half of a commercial customer’s monthly utility bill.

While alternative sources of energy like solar can absolutely help offset these demand charges (not to mention the obvious offsets for power usage), it’s really batteries that can be most effective in reducing (or “shaving,” as it’s also called) these peak periods by delivering the stored power on-demand.

At this point, it might help to see some pictures to get a better idea of how demand charges work, how solar can offset them, and how battery storage can help reduce these charges even further during times and situations when solar power isn’t available.

How do solar batteries work?

Let’s look at a typical commercial customer’s load profile, where power is mostly used during the day. In this case, the customer isn’t using solar or battery storage to offset the costs of their energy usage, so demand tends to predictably rise and then fall over the course of a day.


Look familiar? If you’re a typical organization, it should. Now, let’s see what happens when we add solar power to the picture, where energy from the sun can be used to significantly reduce the number of kilowatt-hours needed at certain times of the day. That load profile might look something like this:

As you can see in the orange area in the graphic above, the energy produced by solar is greatest between around 7am and 5pm every day (i.e., when the sun is shining), dramatically reducing the kilowatts needed during that period. But what about the time outside that period, when the building or operations still need significant power, but there isn’t enough sunlight available to offset that demand with solar? Can those remaining peaks in demand be further flattened out to help save an organization money? They sure can—and that’s where solar battery storage kicks in.

Take a look at the graphic above. The lighter blue area shows how batteries can be charged in the first part of the day; the darker blue area shows where they can be discharged later in the day to reduce, or flatten, those peaks in demand. As you can imagine, in parts of the country where demand charges are high, the savings an organization gets from a 100- to 200-watt reduction in peak demand can be substantial, making commercial solar battery storage a great cost-saving solution.

Is solar energy storage right for your organization?

We’ve seen how battery storage works in conjunction with solar and how it can make a lot of sense for an organization looking to reduce high monthly demand charges. Now, let’s take a look at some of the practicalities of commercial battery storage—and how to figure out whether it might be a worthwhile solution for your organization.

Many people assume the only option is an outright purchase of an onsite solar energy storage system, with costs that typically start in the tens of thousands of dollars and go up from there. However, an ever-increasing number of solar power customers are signing up for Power Purchase Agreements (PPA) through a third-party provider (like TotalEnergies). Under a PPA, the provider installs, owns, and manages the system, which eliminates any upfront costs for the customer and avoids ongoing operational and maintenance costs, too.

Additionally, commercial solar customers who use battery storage – regardless of whether they buy or have a PPA – can achieve payback in as few as three to five years through a combination of state rebates (California, for instance, has its Self-Generation Incentive Program), federal tax credits (including those from the Inflation Reduction Act), and utility savings realized through reduced demand charges. What’s more is that all of the credits earned through the system are passed through the third-party provider straight to the customer, even for PPA systems.

So how do you know if a combined solar power and battery storage solution is right for your organization? It really comes down to how your organization uses energy throughout the day, month, and year. TotalEnergies can provide an in-depth analysis of your load profile, including how your overall power consumption and spikes in demand could be offset by the installation of solar panels and a battery storage system. TotalEnergies can also give you a clear picture of the rebates, credits, and other incentives available in your area.

Thanks to the latest advancements in commercial solar battery storage, the opportunity to save thousands in demand charges every year is real—and really significant. As you evaluate commercial solar power providers and the right solutions, be sure to ask how solar energy storage can be included with your system so you can determine whether it’s the right choice for your organization.

Interested in learning if solar power and battery storage is right for you? Visit or schedule time to talk with the TotalEnergies team at: