Battery Energy Storage 

Business 101 tells us that there are two ways to be more profitable: increase revenue or reduce expenses. A BESS helps with the latter by storing energy gathered for later use during peak periods. This could be as simple as storing up solar energy during the sunny morning hours for use during the evening rush or taking advantage of the low cost power in the middle of the night to have extra energy available for the afternoon surge. In both examples, by switching to saved energy at times when grid costs are the highest, hotel owners can quickly reduce that $2,200 energy bill spent annually per room.

This is where the real value of a BESS comes to play. Unlike other equipment such as generators or emergency lighting that are purchased with the hope they will never be used, a BESS is purchased with the idea that it is used and starts paying you back immediately. Instead of asking the question, “How much is this going to cost?,” hotel owners exploring a BESS quickly realize the question they should be asking is, “How much is this going to save me?” The previously mentioned Energy Star report also states that hotels spend approximately 6 percent of their operating costs on energy. If that figure could be reduced by even just 1 percent, how much more profit would that mean to a hotel’s bottom line?

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Power outages are nightmares for hoteliers. In addition to creating unsafe and unpleasant conditions for guests (which could lead to bad reviews at best and guest and site safety issues at worst), outages can affect everything from lights and elevators to critical business systems and kitchen appliances. An extended outage can shut down a hotel for days, weeks or—in some cases—for good. 

Now, the good news is that we’ve come a long way in the last 20 years, and backup power in hotels in now required by The International Code Council. But while diesel generators have historically been the chosen solution, they are often noisy, emit carbon monoxide, require ongoing fuel costs and regular maintenance and can typically only power a small area at a time.

An ESS, in addition to avoiding many of the traditional problems of diesel generators noted above, can have four commercial units stacked together, offering 1,000 kilowatts of stored energy for use during extended blackouts. When paired with sufficient solar energy and with reasonable adaptation for the available power, the hotel can keep all critical systems operational, including safety systems, refrigeration, internet and business systems. When those business systems still work at the hotel restaurant and bar, the hotel can maintain or even increase revenue during an outage.

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With the increasing focus on sustainable business practices from guests and government agencies, BESS can be a big part of a hotel’s journey to a greener future with more focus on renewable energy sources like solar and wind (for everyday power) and less reliance on fossil fuels (for backup power).

Not only is it the right thing to do for the environment, but there are tangible benefits for hotel owners too. Being listed as a “green hotel” could result in more traffic from sustainably focused travelers. Plus, green business practices in general help reduce expenses as well by using less water, less peak energy, and less environmentally harmful chemicals.

There are even state and federal incentives tied to energy storage systems. The Inflation Reduction Act, for instance, has introduced the opportunity of incentive tax credits through 2032, and hoteliers can claim up to $5 per square foot for energy efficient commercial buildings deductions if they own the building or property. At the state level, in California, PG&E’s Hospitality Money-Back Solutions program offers rebates and incentives for front- and back-of-house solutions including generators and battery ESS at the time of this publication. 

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