How Energy Managers can use batteries to cut costs and carbon

For energy and procurement managers, batteries are no longer futuristic, they are practical levers. Whether at an industrial site, commercial campus, or corporate portfolio, behind-the-meter and on-site storage offer cost savings, flexibility and carbon reduction. As tariffs grow more complex and sustainability pressures intensify, batteries are becoming an essential tool for balancing commercial goals and environmental commitments. 

Why batteries are entering corporate procurement strategy 

Electricity prices are volatile, demand charges are rising and companies face increasing pressure to achieve decarbonisation milestones. Batteries help by: 

• Reducing demand peaks

• Shifting consumption to cheaper periods 

• Enabling greater self-consumption of on-site renewables

• Participating in flexibility or demand response programmes

• Providing backup during outages

In the UK, volatile wholesale markets and rising non-commodity charges make peak management especially valuable. In Germany, rising industrial loads and a high share of solar create ideal conditions for midday charging (when there is a surplus of electricity) which can then be discharged later in the day when consumers need electricity. In the Nordics, flexibility markets are emerging as transmission operators contend with weather-driven variability and new consumption patterns such as electrified heating and EV charging. 

Corporate sustainability commitments are also accelerating adoption. As more companies commit to climate targets, reducing Scope 2 emissions are becoming a central priority. Batteries enable a higher share of clean electricity consumption, particularly when paired with on-site renewables or structured corporate PPAs. 

 On-site and behind-the-meter applications 

The versatility of battery storage is one of the reasons energy managers find it so useful. Common use-cases include: 

Peak shaving 

Peak shaving is often the single most valuable application for industrial and commercial users. For some European countries, network tariffs base charges on monthly or annual peak demand. If a site can shave its top 30 minutes or hour of usage, it can slash its network bill decisively. Batteries excel here as they can discharge instantly when a peak approaches, keeping the site’s demand below threshold. Energy managers typically use EMS software to monitor and predict load spikes and automate discharge decisions. 

Load shifting 

When time-of-use tariffs or dynamic tariffs are in place, companies can minimise cost by shifting usage away from expensive hours. Batteries store energy during low-price periods, such as overnight or during high renewable generation, and release it when prices rise. This is especially powerful with half-hourly or hourly prices, as many utilities are moving toward real-time settlement structures that directly reward flexibility. 

Renewables smoothing 

Solar-plus-storage is now commonplace. Solar generates midday peaks that don’t always align with corporate load, and export prices may be low. By storing surplus solar, batteries increase self-consumption and reduce grid dependence. 

This has two benefits: lower energy costs (as self-consumed electricity is cheaper than grid imports) and a lower carbon footprint (as solar discharges can replace “grey”  power from the grid with higher carbon intensity). 

Backup and resilience 

Batteries provide near-instantaneous backup power. Unlike diesel generators, they respond in milliseconds and can bridge to other assets or support critical loads directly. For data centres, hospitals, and manufacturing lines, this resilience value can exceed the pure energy cost savings. 

Power quality and equipment protection 

In some regions, voltage or frequency fluctuations can damage sensitive equipment or cause downtime. Batteries, especially when integrated with a power conditioning system, can smooth these fluctuations, improving equipment reliability and reducing maintenance. 

Managing tariffs, demand peaks, and flexibility opportunities 

 Energy managers should analyse several layers of their energy and tariff structure: 

 Load profiles 

Load patterns often contain hidden peaks that are not obvious at first glance. For example: 

• A manufacturing line may have sharp startup loads

• An HVAC system might create morning peaks when set points change

• EV charging may create overlapping demand spikes

A battery can be configured to flatten these peaks and deliver a smoother, lower-cost load profile

Tariff structure 

Understanding tariff details is essential. Some tariffs penalise peak demand; others charge based on energy usage during specific windows (e.g., red/amber/green bands in the UK). Dynamic tariffs, where prices change every 30–60 minutes, create even more potential for optimisation. Batteries reduce exposure to high-tariff periods as long as they are dispatched correctly. 

Contract alignment 

The interaction between supply contracts and battery operation must be considered. For example, some contracts limit export, some dynamic contracts have settlement windows that influence battery dispatch timing and some PPAs require minimum off-take volumes that affect charging decisions.

Pairing batteries with on-site renewables 

Solar-plus-storage is one of the most powerful combinations for corporate buyers. Benefits include: 

• Storing midday generation for evening use

• Increasing self-consumption and reducing grid energy demand

• Avoiding low export prices or penalties

• Smoothing production to reduce grid interactions

• Enabling consistent renewable supply for Scope 2 reporting

Energy managers should also model: 

• Expected solar production profile

• Optimal battery capacity vs. peak load

• Expected degradation and replacement cycles

• Interactions with tariff windows

• Percentage of total consumption offset by on-site generation

• Carbon reduction relative to grid intensity

For companies with EV charging fleets, solar-plus-storage is especially attractive. EV charging loads can be shifted to coincide with solar and battery discharge windows. 

Evaluating the business case and financing options 

When building a business case, the following considerations matter: 

CAPEX vs OPEX 

 Not all businesses want to own the battery outright. Leasing, power purchase-style agreements, and Energy-as-a-Service (EaaS) models can reduce upfront cost. 

Third-party operators may take on the optimisation role, bundling the battery with software and maintenance. 

 Savings and revenue modelling 

Key savings streams include: 

• Demand charge reduction

• Energy cost avoidance (from load shifting)

• Reduced curtailment of on-site generation

• Avoided carbon costs in some schemes

• Sensitivity analysis

Energy managers should also test: 

• Changes in future tariff structures

• Changes in renewable output 

• Variations in price volatility

• Degradation and replacement cost scenarios

Misjudging degradation or cycling frequency is one of the most common causes of underperformance in early-stage corporate battery projects. 

 KPIs for financial evaluation 

 A solid business case includes metrics such as:

• Payback period 

• NPV based on projected cashflows

• internal rate of return (IRR)

• Levelised cost of storage (LCOS)

• Cost per avoided tonne of CO₂

• Peak reduction percentage

• Share of renewable self-consumption

Stakeholder alignment 

Energy managers should align procurement, operations, finance and sustainability teams early. Batteries touch all of these functions. Clear internal ownership and consistent KPIs help ensure the project delivers maximum value.  

Additional strategic considerations for energy managers 

Beyond the primary use-cases and business case modelling, there are several deeper considerations: 

Integration with Energy Management Systems (EMS) and automation 

A battery’s value depends heavily on its control system. An effective EMS: 

• Predicts peaks and schedules discharge

• Aligns charging with solar output

• Tracks State of Charge based on operational constraints

• Monitors tariff windows

• Interfaces with flexibility markets

Automation is essential. Manual control is not fast or precise enough to extract full value.

 Site constraints and permitting 

Battery siting must also consider available space, fire safety regulations, noise constraints, visual impact, access for maintenance and the grid connection permit from the grid operators. 

Future flexibility needs  

As more companies electrify processes, with things like heat pumps, electric furnaces, and EV fleets becoming more common, load profiles may change dramatically. Batteries provide adaptable capacity that can support new demands. 

Carbon accounting and reporting 

Batteries can help reduce market-based Scope 2 emissions by enabling higher self-consumption from renewable sources. This contributes directly to sustainability KPIs and reporting obligations. More information on this topic can be found in our E-book on Corporate and Social Responsibility (CSR) regulations.  

Conclusion 

For energy managers, batteries are not just a technical add-on, they are a strategic tool. They give control over when you buy, store and consume power, unlocking cost savings and decarbonisation in one move. The value lies in aligning site operations, procurement strategy, and flexibility market participation. As electricity systems become more dynamic, the businesses with the smartest, most adaptive procurement strategies, powered by storage, will enjoy both lower costs and stronger sustainability performance.