Post: The value of lost load: why on-site battery storage is crucial for businesses

The value of lost load: why on-site battery storage is crucial for businesses

Electricity supply interruptions have financial and social impacts on customers that vary by season, time of day, customer type and customer load. For industrial and commercial (I&C) sectors, even a brief electricity outage can translate into substantial financial loss, reputational damage, and operational delays.

Understanding the value of lost load (VoLL) is important for network operators when determining network planning and investment strategies. This will become increasingly important as customers become more reliant on electricity in the low-carbon future.

In this article we look at how on-site battery energy storage systems can be the key to staying competitive and resilient in an increasingly volatile energy market.

What is VOLL?

Uptime is a precious commodity in manufacturing, and any disruption can have a cascading effect on productivity and profitability. The VoLL represents willingness-to-pay (WTP) to avoid a power outage.  Essentially VoLL is used to determine the optimal balance between security of supply and affordability.

For I&C businesses, a one-hour power outage could result in:

• tens of thousands in lost production
• damaged sensitive equipment
• spoiled inventory in temperature-controlled environments
• missed contract deadlines
• employee downtime and safety risks

In most markets there is a mechanism for estimating VOLL for subsects of consumer types, in ERCOT for example, a 2024 report by the brattle Group estimated a large C&I client at $22,721 per unserved MWh.

Source: Brattle Group report

A powerful solution

On-site battery energy storage has emerged as a powerful and strategic solution. By storing electricity on-site, businesses are no longer solely dependent on the grid for uninterrupted power. Instead, they gain a resilient, flexible energy asset that can be used not just for backup power, but also to optimize energy use, lower operational costs, and contribute to sustainability goals.

One of the most immediate and tangible benefits of battery energy storage is its ability to avoid the financial losses associated with unplanned outages. During a grid failure, a battery system can provide electricity to critical systems or even the entire site, maintaining production lines, data operations, refrigeration, and safety infrastructure.

Another key advantage is resilience against voltage fluctuations and power quality issues, which can be just as damaging as full outages. For operations involving sensitive equipment, automated manufacturing, or continuous processes, even brief disturbances can cause malfunctions, product defects, or restarts that cost time and money. A battery system can act as a buffer, smoothing out irregularities in the incoming power and ensuring a clean, stable supply.

Beyond this, batteries can be used for peak shaving, which involves discharging stored energy during times of high grid demand when electricity prices spike. By reducing a facility’s peak demand charges, which often make up a significant portion of commercial energy bills, businesses can achieve substantial cost savings. Batteries also provide an opportunity to participate in services like frequency response, load shifting, or reserve capacity. Battery storage enables companies to tap into these revenue streams by intelligently charging and discharging energy when the grid needs support.

Battery storage also supports decarbonization and sustainability efforts. When paired with on-site renewable generation such as solar PV, batteries allow businesses to store excess renewable energy for later use, reducing dependence on grid power. This not only lowers emissions but also strengthens energy autonomy and shields against future energy price volatility.

Ready to protect your business?

For businesses where energy equals output, VoLL and power supply protection is critical. Investing in an on-site battery can help your business avoid costly disruptions, enhance sustainability, and unlock new revenue streams, all while gaining a competitive edge in a power-constrained world.

If you’re considering on-site battery storage or want to learn more about how to reduce your energy risk, contact us today for a free energy resilience assessment.

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