Battery energy storage systems are precisely as their name suggests: units that store energy for the power grid. The systems store power for a short period of time and push it into the power grid when needed rather than when it could potentially be wasted. These systems ensure a more efficient power grid.
Anywhere from 1-40 acres is needed for BESS development (in more congested areas, some developers measure and compensate by the square foot).
One difference is the amount of land required; battery energy storage systems are much more compact, therefore, securing higher lease rates per acre for landowners. Another difference is the role they play in the energy market. Solar panels convert the sun’s rays into energy. Meanwhile, BESS keeps the energy until needed. That being said, these energy systems are much more valuable in urban settings because of the variability of energy demand in those areas, giving it the ability to financially compete with almost every other asset class that land can be used for.
The Inflation Reduction Act (IRA) incentivizes landowners and developers to invest in BESS by providing tax credits and funds towards the projects. The federal government is encouraging the development of these storage systems so that power grids can be as efficient as possible.
Yes, developers are beginning to see the need (and incentives) to efficiently store the energy from clean energy vehicles like solar panels as they become more prevalent and efficient themselves. Stand-alone BESS developments provide developers with a unique opportunity to store and buy energy from the power grid when its price is low and then sell it to the utility company, increasing efficiency, minimizing waste.
Yes! Now is an excellent time to install a battery energy storage system. As this technology and market continues to mature, developers are increasingly looking for more candidates to lease their land for BESS. And because of its compact nature, BESS can be very profitable for the landowner and developer. However, eventually, the power grids and substations will reach capacity, so there will be a time when it’s too late to consider the opportunity.
A property adjacent to or within half a mile of a substation is ideal, and depending on the location of a property, the value varies.
Solar + Storage refers to a solar farm paired with a battery energy storage system. Together, the panels collect the energy and the battery storage pushes it onto the grid when it is most needed, increasing productivity and efficiency.
Much like solar leases, the lease term for BESS is generally 20-40 years.