C&I; Storage: Battery Storage for Commercial and Industrial Applications

C&I; Storage play an increasingly important role for companies because they support multiple energy-economic goals simultaneously. They help reduce electricity costs, limit peak loads, increase self-consumption from photovoltaics, and improve security of supply at the site. Especially in times of volatile electricity prices and rising demands for the electrification of processes, charging infrastructure, and self-generation, they are becoming a flexible building block in the energy management of commerce and industry.

It is important to note: C&I energy storage systems are not limited to a single application. Depending on their size, grid connection, and operating strategy, they can serve as classic ITSM solution be deployed behind the meter or in larger projects also FTM logics operate, for example for electricity market or system service applications. It is precisely this versatility that makes the segment so interesting, but also in need of explanation.

This article defines the term, distinguishes it from related concepts, and shows for which companies and use cases C&I storage systems are economically relevant.

What is meant by a C&I storage system?

The term „C&I energy storage system“ does not refer to a standardized technical size, but rather strictly speaking a Market segment. These are battery storage solutions designed for businesses, commercial operations, or industrial facilities, clearly distinguishing them from private residential storage systems. C&I is therefore not a strictly defined technical category with fixed power or capacity limits. The deciding factor is the specific application case in commerce and industry.

Manufacturers, project developers, and market participants usually use the term regardless of the power or capacity range. Provided that the Battery storage is not used in the residential segment, it can even refer to large-scale utility-scale storage systems. This ambiguity is common in the energy storage industry and should be taken into account when classifying specific projects.

What orders of magnitude are common in practice?

In practice, C&I storage systems often range in the order of a few one hundred kilowatts down to the low double-digit megawatt range. The specific design depends primarily on whether the storage system is only intended to fulfill internal optimization tasks or is additionally intended for market- or grid-supportive applications.

Smaller systems are mostly used for self-consumption optimization, peak shaving, or relieving the grid connection. Larger installations are primarily used when several functions are to be combined or when a location has a correspondingly high power demand.

Therefore, for the classification of a project, less rigid performance and capacity limits are decisive than the question of, what task the storage is supposed to fulfill and what connection and operating conditions exist. This is precisely what determines the respective scale in practice.

C&I is not the same as BTM or FTM

C&I is not synonymous with Behind the Meter (BTM) or Front of the Meter (FTM), even though both terms are frequently mentioned in the context of C&I projects.

BTM energy storage systems are installed behind the customer's meter and are primarily used to optimize their own electricity consumption, for example by increasing self-consumption in combination with a PV system or through peak shaving. FTM storage systems, on the other hand, are located in front of the meter and are designed for marketing on the electricity market or in the area of system services. Accordingly, C&I storage systems are not a synonym for simultaneous BTM and FTM operation. Both logics can merely occur within them.

In practice, many C&I storage systems are indeed primarily BTM-driven. The main focus is on reducing electricity costs and making better use of one's own PV generation. However, larger C&I projects are additionally FTM-capable so that the operator can use free capacity for market participation. Thus, C&I primarily describes the customer segment, not the commercialization logic, and can encompass both application logics depending on the project design.

Typical use cases for C&I energy storage systems

In commercial and industrial environments, C&I storage systems cover both BTM and FTM applications, depending on their design:

BTM Applications (Cost Reduction):

• Peak Shaving to reduce capacity-based network charges
• Self-consumption optimization with PV
• Load shifting to reduce procurement costs

FTM applications (revenue from market participation):

• Additional revenue through Control energy
• Participation in the power exchanges (Day-Ahead Trading & Intraday Trading)
• Capacity allocation at the Current reserve

For larger-scale C&I projects, BTM and FTM applications can also be combined (revenue stacking), for instance when additional capacities are marketed on the market alongside self-consumption.

Basic technical structure

A C&I storage system consists of several core technical components that work closely together. The Battery Energy Storage System (BESS) forms the core and chemically stores electrical energy. The Inverter or rather that Power Conversion System (PCS) converts the direct current stored in the battery into grid-compliant alternating current and controls the power flow in both directions.

The Energy management system (EMS) takes over the higher-level control. Based on load profiles, PV generation, current electricity prices, and defined operating strategies, it decides when the BESS charges or discharges. The system is complemented by Protection and control technology, which ensures safe operation, as well as depending on the project by a container solution with appropriate Cooling and a coordinated Fire protection and safety concept.

With combined use of BTM and FTM, the measurement separation important to cleanly distinguish between self-consumption, grid consumption, feed-in, and market-driven operation. Depending on the project, this can be achieved via separate metering points, summation meters, sub-meters, or a corresponding metering and data management system. The decisive factor is that the measurement transparently reflects the respective use of the storage system and fulfills both technical and billing-relevant requirements.

Economic drivers

The economic viability of C&I storage systems results from several factors, which, depending on the Load profile, electricity tariffs, and RE integration have varying impacts. Typically, central to this are the BTM benefits for Reduction of electricity costs and grid fees. In addition, there are potential Revenue from FTM operations as well as the combination within the framework of Revenue Stacking.

Regulatory factors also have a positive impact on economic efficiency. Here is a selection:

• Storage privileges pursuant to Section 19 (3a) to (3c) of the Renewable Energy Sources Act (EEG)
• Reduction of grid fees through § 21 EnFG
• Utilization of time-variable grid fees according to Section 14a EnWG. 20-year grid fee exemption for battery storage systems according to Section 118 Para. 6 EnWG (until August 4, 2029).
• Reduction of grid fees through atypical grid usage pursuant to Section 19 (2) sentence 1 of the Electricity Grid Access Ordinance (StromNEV) (expected until 2029)

Even after Grid fee reformAgnes) flexibility will pay off for operators of C&I storage systems. These framework conditions should be considered from the outset in the economic evaluation of a C&I project, even though the specific design always requires a case-by-case assessment.

Since investing in a proprietary storage system involves corresponding CAPEX, many companies alternatively rely on Contracting. This allows companies to benefit from the aforementioned economic advantages without financing and operating the storage system themselves. A special solution is the CUBE Profit Flex Solution® (CPFS). This finances the C&I storage system itself, provided that a purely behind-the-meter operation is not yet profitable. As a result, the economic evaluation initially shifts to CUBE CONCEPTS, and the investment decision toward pure operating cost optimization is significantly facilitated.

For which companies do C&I energy storage systems pay off?

C&I storage systems are generally suitable for all companies with high load profile, pronounced peak loads or own PV generation, but in practice, industry-specific priorities emerge:

• Manufacturing plantsReduction of production-related load peaks, frequently caused by energy-intensive machinery or equipment startups.
• Logistics and industrial real estateGrowing demand due to high peak loads when charging e-fleets, as the existing grid connection capacity otherwise quickly reaches its limits.
• Data centersEnsuring security of supply and cushioning rising grid fees while maintaining a consistently high base load.
• food and process industryUnbroken cold chains and continuous process heat require both security of supply and a stable, cost-efficient energy supply.

Purchasing a C&I storage system isn’t yet a viable option for every company. Through Contracting, companies whose load management and flexibility requirements are expected to increase—whether due to rising electrification, growing PV installations, or changes in regulations—gain access to this technology. Provided there is sufficient grid connection capacity, Contracting participants benefit from additional FTM revenues without assuming any business risk or technical operational responsibility themselves.

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