Of the multitude of renewable energy procurement options available, onsite renewables may be the most resistant to policy changes that could potentially impact expected economics. Solar, the most popular source for onsite renewable energy, has a unique value proposition because it reduces electrical load at the customer’s location. This concept, known as behind-the-meter, effectively insulates renewable energy savings from the effects of certain types of policy decisions.
Behind-the-meter solar is located on the customer side of the electrical meter rather than on the utility side. This means that electrons produced by the solar panels first go to power all the machines, lights, and other electricity-consuming devices at a facility before any extra energy is exported to the grid for others to use. If the solar power system is designed to match your facility’s consumption profile, the system will have no (or minimal) exports back to the utility grid. From an energy billing perspective, the end result is similar to an energy reduction at your facility; like turning off electrical appliances and machines or using high-efficiency electrical devices.
The behind-the-meter structure is beneficial because some utilities pay less for exported energy, and a behind-the-meter system does not rely on current net metering policies or future expectations thereof. Furthermore, if your organization’s utility bills are based on time-of-use rates, you may realize additional savings due to the coincidence of solar power’s daytime production profile with peak demand times. In this scenario, your business also becomes a candidate for pairing onsite renewables such as solar with energy storage, which further maximizes economic savings depending on your utility bill rate structure.
Onsite solar can also offer unique marketing benefits around environmental claims. Many onsite customers appreciate that behind-the-meter energy offsets their direct utility consumption and that the renewable energy is produced at the same geographical location that it is used. Furthermore, solar panels add visibility to the sustainability efforts at your facility and display evidence of your environmental commitment.
Although onsite solar usually will not offset your company’s entire electrical load, it can be a valuable portion of your renewable energy portfolio, which can also include offsite renewables procured via the wholesale market and energy attribute certificate purchases.
Schneider Electric helps Commercial, Industrial, and Institutional (C&I) customers evaluate the impacts of the many renewable energy choices available and decide on the best mix to meet current and future goals. Reach out to our strategic renewables team to assess whether onsite renewables can complement your company’s sustainability strategy.