114. How a UPS Can Provide a Return on Investment as an Energy Storage System

Uninterruptible power supply (UPS) systems are often installed to protect critical equipment and loads from power outages, and other voltage and current problems. Many UPS systems continuously regulate the input power, thereby maintaining a constant and uniform supply of electricity. UPS systems are typically used on computer hardware or other equipment where an unexpected power disruption could cause fatalities, serious business disruption, or data loss, such as at data centers, telecommunication facilities, hospitals, and power plants. While UPS systems have batteries and obviously store energy, they are not synonymous with standard battery energy storage systems that are commonly being added to the power grid these days. In fact, UPS systems are often not allowed to export power to the grid. However, that doesn’t mean they can’t serve a useful purpose in lowering energy bills and providing a return on investment to owners. “Historically, UPSs are sitting there waiting for something bad to happen—they were kind of insurance devices,” Yaron Binder, vice president of Product Management with SolarEdge Critical Power, said as a guest on The POWER Podcast. “But I think there’s a growing understanding that these could also double as an energy storage system, and actually create some kind of benefit, let’s say, revenue for the customer, apart from just sitting there waiting for the power to go out.” In the past, many UPS systems used lead-acid batteries, which were not a good fit for cycling operations. Today, however, many UPSs have lithium-ion batteries, which are much better suited to regular cycling. Therefore, there is less downside to using a UPS for more than just emergencies. Binder said there are many clever ways to utilize UPSs. “One of the things you can do, for example, is use the UPS as a demand response component,” he said. Although, as previously mentioned, owners may not be able to export power directly to the grid, they can reduce their power demand when electricity prices spike by using their UPS to