Energy as a Service (EaaS) has come to the forefront of the energy landscape. With providers delivering varying flavours of the offering, it’s easy to get confused, which is why this article aims to cut through the noise and provide a high level view of what is meant by an EaaS arrangement. We’ll also cover why businesses choose this option for their energy and sustainability projects.
What is Energy as a Service?
Energy as a Service, put simply, is a finance arrangement. A provider, such as Wattstor, provides energy assets for a specific site, offering payback terms over a number of years in the form of a Power Purchase Agreement (PPA), alongside value-add services such as energy market access and maintenance. At the end of the arrangement, the site owner or business then owns the assets. These assets could vary from solar panels, battery storage, EV charging ports, heat pumps, inverters, EMS and more. Each arrangement will vary based on the site and operations.
Along with the financing of assets, an EaaS model can enable business energy users to completely outsource their energy management needs as part of the arrangement. The EaaS provider takes on the responsibility of managing and maintaining all energy systems covered within the scope of the energy project. This includes energy procurement, trading, distribution, storage, and maintenance, as well as managing regulatory compliance.
Why do businesses choose Energy as a Service?
Cost savings, risk reduction, sustainability, flexibility, and scalability are all contributing factors to businesses choosing EaaS.
Cost Savings
In the case of Wattstor’s offering, cost savings are delivered in several ways:
- Via the self-consumption benefits of using site-generated renewable electricity
- Via the procurement and sale of energy through automated participation in the electricity markets
- Through the savings delivered on maintenance, upgrades, and regulatory compliance, as all of this comes under the EaaS agreement.
Risk Reduction
By taking on a EaaS arrangement, the risks associated with energy system ownership and management are removed (such as maintenance costs, equipment failures, and compliance). A good EaaS provider, such as Wattstor, will have access to the latest in EMS and trading technologies, meaning that any participation in the electricity markets comes without risk. Risks will also be reduced as Wattstor ensures energy systems are up-to-date and functioning optimally, further reducing the risk of downtime or failure.
Sustainability
Energy as a Service offers the opportunity to obtain and benefit from on-site renewable energy sources. This helps businesses and organisations achieve their sustainability goals and reduce their carbon footprint. Sites can access bigger, more sophisticated systems, which deliver greater sustainability credentials, due to the project management, financing, and ongoing maintenance that an EaaS agreement presents.
Flexibility
Businesses can choose the energy sources and technologies that best meet their operational requirements. For example, a hospital may require a more reliable energy source than a retail store, and EaaS providers can offer energy solutions that meet these unique needs. There is also flexibility in the payment terms based on preferred timeframes.
Scalability
A business can expand and modify Energy as a Service as its needs change. It’s simple to add more assets to the agreement and to modify the system based on changing energy consumption profiles.
Freedom to run your business
There’s no underestimating how much time and resource can be tied up in energy projects. By outsourcing energy management and project development to a third-party provider via EaaS, businesses can focus on their core operations.
Large sites have a clear opportunity to impact the sustainability landscape. However, smaller and mid-size businesses are often left out of the picture when it comes to green initiatives, because of lack of capital. These businesses form a huge part of the economic landscape, and have both the inclination and capacity to make huge leaps in sustainability with the right services at hand.
All sectors have the challenge of resource to manage such energy projects. This is where Wattstor’s EaaS offering shines, providing both the capital investment and the resource to manage and maintain