Linking ROI and reliable energy

The geopolitical environment has exposed just how volatile the energy market can be. As uncertainty increases, so does the price of fossil fuels, which in turn has a knock-on effect on the industries opting for non-renewable energy sources. So how can businesses futureproof themselves and take matters into their own hands? 

 

 

Investing in long-term sustainable solutions

First and foremost, ROI should not be assessed purely on unit cost savings. Instead, businesses should also consider the advantages of avoiding peak charges and reducing grid dependence to improve resilience against energy price volatility. Solutions like on-site generation and storage often deliver multiple value streams, including cost and carbon reduction and security of supply, which together can outperform traditional efficiency projects when assessed holistically.

 

Hyperscale operators are perhaps already ahead of the curve, seeing the longer-term value of investing in on-site generation and storage. But it’s not just the big players who can save money.

 

 

Green practices, green returns

It can be easy to assume that simply ticking the eco-friendly box is enough to satisfy stakeholders’ expectations. But the benefits of intelligent and informed renewable energy storage shouldn’t be underestimated. Meaningful ESG integration also delivers significant financial benefits, which strengthens investor and customer confidence.

 

With traditional power sources, such as fossil fuels, businesses with energy-intensive operations would typically operate overnight - when national demand is lower, and energy unit prices are lower. But with renewable generation, businesses can work throughout the day when output from renewable assets is typically highest.

 

Behind-the-meter assets are a viable solution for businesses looking to take this step. Solar panels or wind turbines can be installed on site, allowing more tactical use of energy, particularly during periods of higher generation.

 

But what about for businesses that operate around the clock? The installation of lithium-ion batteries allows businesses to essentially strengthen their own microgrid – storing any excess energy from peak generation windows. This has the added bonus of functioning as a form of energy insurance, with the ability to generate onsite and off-grid, providing a failsafe in the event of a blackout.

 

 

Advantages for all?

Businesses can also benefit financially from on-site, behind-the-meter generation and storage. Government incentives such as the Smart Export Guarantee enable organisations with solar installations to export surplus electricity back to the grid in return for payments, creating an additional revenue stream alongside reduced import costs. While upfront investment is still required, the scheme can improve overall project economics for small-scale renewable generation across solar, wind and hydropower.

 

Boosting sustainability credentials can prove lucrative for businesses, with stakeholders who prioritise sustainable measures throughout their supply chains being drawn to businesses that value ESG.

 

Looking ahead, data has shown that 56% of UK businesses are considering investing in on-site generation capacity. Is it time that businesses get ahead of this curve, better understanding when and how they are using energy?

 

Although the initial investment can appear as a significant hurdle, data-led monitoring and tailored optimisation strategies allow businesses to gain a precise understanding of local demand and align generation accordingly, helping to lower long-term energy costs. On-site renewable generation also improves resilience against volatility in National Grid supply, enabling organisations to take greater control of both price exposure and operational continuity.

 

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Tim Foster is Director of Energy for Business at Conrad Energy

 

Main image courtesy of iStockPhoto.com and Pavel Babic