Reliability, Resiliency, Cost, and Climate Driving C&I Power Systems

Commercial and industrial (C&I) entities want to ensure they have electricity when they need it. Businesses also are looking at sustainability, decarbonization, and control of their energy costs as factors when installing their own power generation systems, which may utilize a variety of technologies.

Manufacturing plants, data centers, healthcare facilities, business complexes, and college campuses are among the commercial and industrial (C&I) entities looking at ways to improve their operations through onsite power generation. It could be a thermal option, utilizing a fossil-fueled cogeneration plant; renewable energy from solar, wind, or geothermal; or receiving electricity from fuel cells or battery energy storage. The use of small modular reactor (SMR) nuclear technology also is being considered by at least one U.S. university and has been discussed as way to power remote locations.

“A trend we’re seeing is that C&I businesses across the country are choosing to take control of their energy production and implement power generation systems,” said Manik Suri, founder and CEO of Therma, a tech company focused on refrigeration. “According to some estimates, 80% of companies believe that a quarter of their energy production will come from onsite resources by 2025.”

A range of hardware and software technologies are available to build C&I power systems, from both established and emerging companies in the energy space. Operations managers may want better reliability and resiliency, and more control of their energy costs, or the focus could be on decarbonization, and environmental, social, and governance (ESG) goals.

“Environmental, social, and governance [initiatives] are increasing as major considerations across regions,” said Mourad Chergui, senior product manager at Delta-Q Technologies, a Canadian provider of battery charging solutions. “Two factors driving ESG changes in power systems for C&I organizations are consumer demands and government regulations. For example, there is an increased demand from consumers to have a cleaner environment, putting more social responsibility on companies to improve sustainability practices. Government, in many places, also plays a critical role in reducing emissions by issuing regulations that are in favor of renewable sources and cleaner energy.”

Controlling Energy Costs

“Self-generation of energy is an effective way to circumvent future increases in energy prices,” said Jacob Feutz, program manager for EnTech Solutions, a group designing energy solutions that can evolve with business needs. “As the world transitions from fossil fuels to electrified applications, having control over the power generation aspect of operational costs will be important for all types of businesses.”

Suri told POWER, “The first step is to implement simple changes that make your business more energy-efficient, such as installing efficient lighting/HVAC [heating, ventilation, air conditioning] and promoting sustainable practices across the company culture. Clean operations lay the groundwork for choosing an optimal onsite power generation system.”

“From a power generation standpoint, the future mostly holds improvements in efficiency and production of existing types of assets,” said Feutz. “There are significant new technologies coming in energy storage, which will further improve the financial and resiliency benefits of onsite generation. Energy costs always seem to be the primary driver of power system projects, but the secondary goals of resiliency and sustainability play a very strong role in getting a project to pencil out. If the business needs onsite generation for cost or resiliency reasons, they should also take that opportunity to address their sustainability goals as well.”

Kirk Edelman, chief commercial officer of Safari Energy, talks with POWER about how solar can support C&I power systems in this installment of The POWER Interview.

C&I customers have many issues to consider when choosing a power generation system. The system’s size and technology, location, permitting, and operations and maintenance protocols are all part of developing an effective and efficient strategy for providing electricity, heating, cooling, and more.

“One element that is often overlooked is the consideration for routine and emergency maintenance of the system,” Feutz told POWER. “A system may look good in all other aspects but if it is routinely needing service or expensive to maintain it fails to provide the financial benefits it was designed to offer companies: stable electrical energy.” Feutz added that businesses need to consider not only what their needs are today, but how their needs will scale over time. “As EV [electric vehicle] needs increase and electrification in general accelerates, what will your future energy needs look like? How will the asset you deploy today scale to match those expanded needs?” he asked.

Chergui told POWER, “One of the biggest challenges for C&I customers like businesses and campuses with existing power generation installations is managing increased power demands. There is limited power from the grid. So, as demand for more power increases, they have to consider available solutions, with three common options. For one, businesses and campuses can curtail demand by shifting to more efficient systems to power lighting or air conditioning. C&I customers can use the growth of demand as an opportunity to add supplementary renewable energy from cleaner options like solar panels. The second option is to look at local power generation from cleaner, localized renewable sources to generate electricity and supplement the needed power. A third option is peak shaving, which involves installing large battery banks to store energy during off-peak hours. This approach helps handle peak power demands and reduces the cost of installing more power lines.”

Technology and Power Quality

Power quality is an important part of C&I power systems, and can refer to the degree of abnormality among several different electrical system characteristics. Those characteristics can include the frequency and amplitude of voltage, the balance between phases on multi-phase systems, and the distortion level of the waveform. The characteristics that are important, and what is considered an acceptable level of power quality, vary from facility to facility.

Older electro-mechanical equipment often was able to handle minor power quality-related issues with little or no effect on operations. But as loads have shifted from electro-mechanical to electronic, power quality has become more of a concern for all types of businesses. Power reliability—and thus power quality—is a priority in an effort to mitigate problems such as equipment malfunctions, loss of process control, and data corruption.

“A wave of new technologies is coming to the commercial and industrial landscape, including and going well beyond traditional power generation assets. These technologies can be divided into decarbonization, decentralization, and digitization,” said Suri, who told POWER that renewable energy technologies not only can replace “heavy-emissions electricity sources,” but also can “democratize access to power generation.”

Suri cited onsite solar, noting, “Power conversion efficiency is continuously improving, costs are dropping, and new technologies are emerging. Some trends for C&I to watch include building-integrated photovoltaics [BIPV] and lightweight or even flexible solar panels in the near future. In short, we can expect to see more efficient solar arrays with better integration, produced cleaner and cheaper than ever.”

1. Windspire is a vertical axis wind turbine, and can be manufactured in a variety of sizes for use by commercial and industrial enterprises—in this case, sited in the parking area of a business. Courtesy: Windspire Energy

Suri also mentioned fuel cells, noting the U.S. Department of Energy is “prioritizing the development of hydrogen fuel cell technology, which will have applications across the commercial and industrial sectors. This technology is especially relevant in hard-to-abate industries, where electrification is not feasible, such as industrial processing, chemicals, manufacturing, and heavy commercial.” Suri also said onsite wind has growth potential, as “new turbine designs could increase its potential applications around onsite commercial and industrial facilities. These designs include a range of more vertical and space-conscious alternatives, such as Windspire [Figure 1], and bladeless options such as the windstalks designed by Atelier DNA in New York.”

A Variety of Choices

Choosing the right technology is a major consideration for any C&I power system, and while many enterprises are looking at renewable energy, there remains demand for efficient thermal-based products. Mitsubishi Power, part of Mitsubishi Heavy Industries, recently received an order for two H-25 gas turbines, each with generation capacity of 32 MW, for a natural gas–fired cogeneration plant being built in Tashkent, capital of the Republic of Uzbekistan. The plant will be operated by JSC Tashkent HPP, a cogeneration business operator serving the city and its businesses, and is scheduled to come online in 2024.

2. The Massachusetts Institute of Technology (MIT) upgraded its Central Utilities Plant, replacing an older 22-MW gas turbine with a newer model, and adding a second 22-MW gas-fired unit. Each unit has a heat recovery steam generator. Courtesy: Bond Building Construction

The Massachusetts Institute of Technology (MIT) upgraded its Central Utilities Plant (CUP) in a recent multi-year project. The CUP (Figure 2) is a campus facility utilizing thermal and electric energy. The project involved replacing a single, aging 22-MW gas turbine with a new turbine, while adding a second 22-MW gas turbine, each with a heat recovery steam generator. In addition, MIT entered into a power purchase agreement with Dominion Resources, a Virginia-based utility, to receive solar energy from an array in North Carolina.

Purdue University in Indiana is collaborating with Duke Energy, the state’s largest utility, on a project that would power the school’s campus—and provide power to the local grid—with SMR technology. Idaho National Laboratory recently said it is exploring an onsite nuclear reactor as part of its effort toward net-zero emissions at its Idaho Falls facility, noting the reactor could be part of a campus microgrid.

Software is increasing in importance for C&I systems, particularly as more distributed energy resources (DERs) are integrated. Envizi, an IBM company, offers energy management software that enables a C&I business to “gain transparency into how your energy efficiency projects, solar PV, and metered assets are performing in real time to prioritize and manage initiatives that reduce energy consumption and emissions.” The company said its energy efficiency management software can “Increase the visibility of your building’s energy usage patterns, reduce energy costs with alerts about energy waste, and use data-driven analytics to determine where to focus energy efficiency programs.”

Schneider Electric’s EcoStruxure Power, featuring power and energy meters and management software, and power quality monitoring, provides facility and maintenance teams “more insight and control over electrical power,” utilizing “digitization, connectivity, and advanced analytics… needed to deliver the relevant information needed to improve asset management, reliability, operational efficiency, and sustainability.” Schneider notes that “smart power distribution is at the core of a smart building or campus. Unified platforms are empowering operators and occupants with new levels of visibility and actionable information.”

Albireo Energy, headquartered in Edison, New Jersey, is a global provider of building technology solutions “optimizing performance, reducing cost, increasing reliability, and decreasing energy usage.” Among its services is the integration of programmable logic controllers (PLCs), which it designs to integrate with devices using the Internet of Things (IoT), robotics, vision systems, and more.

PLCs “are specialized, hardened computer devices that connect different units and enable them to work in a coordinated manner,” according to Albireo. A PLC “has two programs, the operating system (OS) and the user program. The OS runs tasks and programs automatically. The user program is the part of the PLC that allows operators to key in outputs they require, which can be stored in the PLC’s memory. These programs work together to process key tasks.”

3. Yotta Energy’s SolarLeaf energy storage technology can be paired with the company’s dual-power inverter, providing flexibility for a solar-plus-storage system suitable for commercial and industrial sites. Courtesy: Yotta Energy

Yotta Energy, a Texas-based solar energy equipment supplier, has partnered with AP Systems, a microinverter technology manufacturer, to develop a dual-power inverter (DPI), a power conversion system designed to be interchangeable between solar and energy storage. The company said the DPI “delivers maximum flexibility and brings all the benefits of a microinverter at costs comparable to string inverters.” The system, rated at 1.2 kW, is a four-port microinverter “capable of accommodating up to four high-capacity PV modules [each up to 440 W] and is directly compatible with Yotta’s SolarLeaf SL1000 [Figure 3] energy storage technology.”

Yotta’s technology will be used in a new solar-plus-storage microgrid at Nellis Air Force Base near Las Vegas. “Yotta Energy is a great candidate for this program,” said Timothy Tetreault, project manager at ESTCP, or Environmental Security Technology Certification Program, the Department of Defense’s environmental technology demonstration and validation program. Tetreault said Yotta’s system is valuable “because of the distributed and flexible solution the technology provides for different use cases on military installations. We are excited to implement this technology at Nellis Air Force Base as we strive to future-proof our military with resilient and sustainable solutions.”

Markets, Regulation, Utilities

The Federal Energy Regulatory Commission (FERC) in 2020 issued Order 2222, which essentially opened wholesale electricity markets to DERs. Energy analysts said the order provides an opportunity for investor-owned utilities to design a distributed energy operating model focused on customer needs.

Ken Schisler, senior vice president of Regulatory Affairs for CPower, a company that serves thousands of customers and manages more than 5.3 GW of DER capacity across North America, told POWER, “In the early 2000s, regional transmission operators [RTOs]/independent system operators [ISOs] created market opportunities for demand response [DR] and now DERs to participate as supply resources in the market competing against generation resources. This enabled customers to get paid directly for making their flexibility available as opposed to participation on the demand side, which meant exposing themselves to more pricing risk in the hope of capturing some savings from flexibility.”

Schisler said, “This supply side approach has proven the most successful model worldwide to deploy DR and DERs. This single policy innovation brought in thousands of new megawatts to participate in flexibility programs that likely would not have materialized. There is nothing inherently wrong with demand side approaches like time-of-use pricing, etc. But they are decidedly less popular with customers than the supply side approaches.”

Schisler said Order 2222 “enables DER aggregators to develop more diverse portfolios that will be more valuable to the system than the sum of its individual DERs. As the price of a lot of these technologies, like solar panels, batteries, energy management systems, and other DERs, come down even further, our customers’ appetite for grid-edge technologies continues to grow. By removing barriers to DER aggregation, FERC opened up revenue potential that will make it easier for even more energy users to invest in DERs.”

Some markets are moving more swiftly than others to incentivize C&I power systems with DERs, whether as part of decarbonization programs or establishing virtual power plants (VPPs). “One trend we’re starting to see more of is interest from utility companies in power generation and storage assets sited at C&I customers,” said Feutz. “Their interest is in systems that can provide benefits to the customer [energy reduction, peak demand shaving, resiliency] as well as to the utility [peak load reduction, voltage/frequency support, reduced need for distribution upgrades]. I think we’ll continue to see dual interest in these types of assets from both sides of this equation.”

Said Suri: “Software and data analytics represent the engine powering many of the energy innovations discussed above. Experts believe that a smarter grid will be crucial to reaching the level of decarbonization required in the U.S. and beyond. The C&I sectors, especially those with large electricity demands, should expect to see a significant influx of solutions that drive energy bill savings, facilitate the sale of excess power back to the grid, and support the broader shift toward cleaner, cheaper power.”

Darrell Proctor is a senior associate editor for POWER (@POWERmagazine)

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