Solar PPAs and Battery Storage: A Match Made in Australia

Australia has emerged as a global leader in renewable energy adoption, with an increasing number of businesses turning to solar power to reduce their carbon footprint and energy costs. As we discussed in the previous article, these systems are becoming more affordable than ever, too. The next challenge will be ensuring that Australian businesses are deriving the maximum value in the way they leverage their investments in solar PPAs and battery storage. If they can do so, the benefits are extensive, since it means energy independence, cost savings and sustainability.  

But there’s also much more to achieving success with this than simply installing solar panels. Australian organisations need to know how to build a strategy around the technology, too. 

What is a PPA? 

Solar PPAs are a way that organisations can strategically control their costs without acquiring a solar system as an asset. They are a contractual arrangement between businesses and solar energy providers, and under a PPA, the solar energy provider installs and maintains the solar panels on the business premises. In return, the business agrees to purchase the generated solar energy at a predetermined rate (usually significantly cheaper than the grid price) over a period of 10 to 25 years. 

The cost savings in comparison to standard power consumption are substantial, while also eliminating the upfront costs of installing the systems. With solar PPAs, commercial solar suddenly becomes accessible to many more businesses, and indeed it becomes an opportunity to simply reduce costs with an immediate return, rather than a major project with massive capital expenditure up front. 

See What is a PPA for more information. 

Battery Storage: Enhancing the Value of Solar PPAs 

For organisations that want to derive even more value from their solar PPA, battery storage systems are becoming a must-have complementary technology. 

By integrating battery storage into the equation, the overall system offers:

Increased Energy Reliability

Battery storage ensures a continuous and reliable energy supply, even during grid outages or periods of low solar generation. Stored energy acts as a backup power source, providing businesses with energy resilience and minimising disruptions to operations. 

Optimised Cost Savings 

By utilising stored energy during peak demand periods, businesses can reduce or eliminate costly demand charges. Battery storage allows businesses to maximise their solar energy utilisation, further optimising cost savings and increasing the financial returns of their PPA investments. 

Enhanced Energy Independence 

Battery storage empowers businesses to become more energy independent by reducing their reliance on grid electricity. By storing excess solar energy, businesses can decrease their dependence on fossil fuel-based grid energy and contribute to a greener, more sustainable future. 

Can I add battery storage to an existing PPA? 

It is possible to add battery storage to an existing PPA, and indeed many organisations take a two-staged approach to their renewable energy adoption. 

There is a caveat, however, in that it is essential to review the terms and conditions of your current agreement to ensure compatibility and consider any necessary amendments. This can become complex, so it might be a good idea to consult with a trusted solar energy provider with experience in battery storage integration when assessing the feasibility of adding batteries to your existing PPA. 

Are PPAs suitable for businesses of all sizes? 

PPAs are suitable for businesses of various sizes, ranging from small enterprises to large corporations. The reasons why organisations might prefer a PPPA to purchasing a solar system outright vary, but the scalability and flexibility of these agreements make them adaptable to different energy requirements and business needs. For smaller businesses, solar PPAs provide an opportunity to access solar energy without the upfront costs, enabling cost savings and sustainability. Larger businesses can benefit from the added advantages of battery storage integration, such as energy resilience, time-of-use optimisation, and increased control over their energy supply. 

So, How Do You Get Started? 

Getting started with a solar PPA is a relatively straightforward, five-step process. However, there’s some complexity involved (such as being able to assess your energy needs), so the more deeply you engage with an expert partner, the more likely it is that you’ll get the results that you need. 

Here’s a guide to the process:

1. Assess Your Energy Needs: Evaluate your energy consumption patterns and determine the potential benefits of battery storage for your business. 
2. Engage with Solar Energy Providers: Consult with experienced solar energy providers who offer battery storage solutions. Discuss your requirements and explore the feasibility of incorporating battery storage into your PPA portfolio. 
3. Evaluate Financial Viability: Consider the financial implications of adding battery storage to your PPA. Assess the potential cost savings, financial returns, and payback period to make an informed decision. 
4. System Design and Installation: Work closely with your solar provider to design a system that meets your energy needs and integrates both solar panels and battery storage. Ensure that the system is installed by qualified professionals to guarantee optimal performance and reliability. 
5. Monitoring and Maintenance: Establish a monitoring and maintenance plan with your solar provider to ensure the ongoing performance and longevity of your solar and battery storage system. Regular maintenance and monitoring will maximise energy production and identify any potential issues early on. 

By following these steps, you can embark on a renewable energy journey that combines the benefits of solar PPAs with the power of battery storage, enabling your business to optimise energy usage, enhance energy reliability and contribute to a more sustainable future.