Many of our clients ask ZAM about typical Microgrid configurations for a cold storage facility. The following is fairly typical. However, Zam Energy is also undergoing an analysis now of adding fuel cell technology to the configuration and will be testing the expected payback. We forecast that this will help the ROI to less than 4 years if all energy rates stay the same, but they are likely to increase with climate risks that throw mass uncertainty to the capacity markets.
The Global Refrigerated Warehouse Service market is projected to experience robust growth from 2024 to 2031, with estimates indicating a rise from 3.9 billion in 2024 to 6.61 billion by 2031, achieving a compound annual growth rate (CAGR) of 9.18%. This upward trajectory is driven by increasing demand for Refrigerated Warehouse Service solutions across various industries, spurred by the need for enhanced efficiency, productivity, and sustainability.
Challenges
The cold storage industry faces several challenges, including the cost of energy, unreliable power grid events, labor shortages, and the rising cost of materials.
Renewable Energy Microgrids offer the cold storage industry predictable, long-term low energy costs, clean power, and peace of mind. Zam Energy's consultants will assist your team with design engineering, construction, commissioning, third-party finance, and owner/operator partners, all key ingredients to launching a mission-critical power system.
Opportunities
The cold storage industry is experiencing a surge in demand due to several factors, including the growing popularity of frozen food, the expansion of e-commerce grocery shopping, and technological advancements.
To guarantee energy access, reliability, and cost economics, Zam Energy offers renewable energy microgrids designed, built, owned, and operated by a third party using off-grid clean energy to solve rising costs with cheaper, cleaner, and more reliable power.
Many markets nationwide face energy capacity shortfalls and extreme weather events, creating unpredictability for the local utility grid. Whether completely off-grid or integrated into the grid, microgrids run off of solar and storage alone for part of the day, a unique aspect of this project size. They also incorporate an on-site combined heat and power (CHP)Â system; increasingly, fuel cells are making microgrid pencil even better.
Renewable Energy Integration
Incorporating renewable energy sources, such as solar panels and battery storage, into the facility's energy mix can offset reliance on traditional grid power. With a microgrid on-site, the cold storage facility now has predictable, low long-term energy costs, clean power, and peace of mind. Third parties often finance, own, and operate the system, leaving customers with smart power that can also take advantage of energy storage systems.
Grid Independence: Resilience and Sustainability
Energy storage optimizes solar power and enables cold storage facilities to become more independent from traditional power grids. Solar energy can be stored and utilized during power outages or take advantage of lower peak rates through battery storage. This newfound independence fosters greater resilience and significantly reduces reliance on fossil fuels.
In addition to these advancements, cold storage facilities can incorporate features such as waste heat management systems and smart grid interaction. By embracing such smart energy management solutions, the cold storage industry can reduce operational expenses and outpace growth expectations.
Time-of-Use Optimization: Maximizing Savings
Beyond energy storage, users can optimize time-of-use rates, capitalizing on periods of low demand and releasing stored energy during peak demand. This strategy reduces overall electricity expenses and maximizes savings, a crucial consideration in the energy-intensive cold storage sector.
Smoothing Out Intermittent Output: Enhancing Reliability
Given solar power's dependency on sunlight availability, intermittent output remains a challenge. Energy storage systems prove instrumental in bridging this gap, providing a consistent electricity supply and enhancing the reliability of cold storage operations, even in the face of factors like cloudy skies, shadows, or dust.
Energy storage solutions can provide the cold storage industry with many benefits. These solutions enhance energy efficiency and sustainability and offer specific advantages tailored to cold storage's needs.
These systems empower the storage of surplus energy for future utilization. Through solar especially during peak sunlight hours, excess energy can be captured and stored for later use. This approach guarantees a consistent and dependable power supply, even during reduced sunlight or nighttime hours. This not only bolsters sustainability efforts but also results in substantial cost savings
Zam Energy is committed to power stability for mission-critical operations and employs leaders with decades of experience in microgrid power system engineering. Integrating energy-efficient systems and smart energy management becomes imperative as the cold storage industry evolves. Zam Energy brings a portfolio of partners with cold storage warehouse success. Let us help make your vision for a sustainable tomorrow a reality as a partner in the transformative journey of the cold chain industry.
Skip below to scroll through several configurations.
Base Configuration
250,000 sq ft facility with 2.5 MW peak load
Power Generation
Solar PV System
Capacity: 1.2 MW DC
Annual Production: ~1,600 MWh
Array Type: Rooftop installation
Cost: $1.2M ($1,000/kW)
Natural Gas Generator
Capacity: 2 MW
Type: Combined Heat and Power (CHP)
Heat Recovery: Used for defrost cycles
Cost: $2M ($1,000/kW)
Energy Storage
Battery System
Capacity: 2 MWh
Chemistry: Lithium-ion
Duration: 2 hours at 1 MW
Cost: $800K ($400/kWh)
Control Systems
Microgrid Controller
Type: Advanced DERMS
Features: AI optimization
Cybersecurity: NIST compliant
Cost: $150K
Integration
Switchgear: $200K
Transformers: $100K
Protection Systems: $50K
Total System Cost: $3.5M
Alternative Configurations
Configuration A: Solar + Storage Focus
Emphasis on renewable energy
Generation
Solar PV: 2 MW ($2M)
No generator
Storage
Battery: 4 MWh ($1.6M)
Duration: 4 hours
Controls: $150K
Integration: $300K
Total Cost: $4.05M Payback: 4.8 years Benefits: Higher sustainability metrics
Configuration B: CHP Emphasis
Focus on thermal integration
Generation
CHP System: 3 MW ($3M)
Heat Recovery for:
Defrost cycles
Space heating
Hot water
Storage
Thermal Storage: $400K
Small battery: 1 MWh ($400K)
Controls: $150K
Integration: $350K
Total Cost: $4.3M Payback: 3.9 years Benefits: Higher thermal efficiency
Configuration C: Minimum Essential
Focus on reliability
Generation
Natural Gas Generator: 2.5 MW ($2.5M)
Storage
Battery: 1 MWh ($400K)
Controls: $100K
Integration: $250K
Total Cost: $3.25M Payback: 4.5 years Benefits: Lower upfront cost
Selection Factors
Climate Considerations
Solar-Heavy Configuration
Best for: Sun-belt regions
Annual sun hours: >2,000
Clear sky days: >200
CHP-Heavy Configuration
Best for: Cold climates
Heating degree days: >4,000
High thermal loads
Hybrid Configuration
Best for: Mixed climates
Seasonal variations
Variable loads
Utility Rate Structure Impact
High Demand Charges
Favor: Larger battery systems
Target: Peak shaving
ROI driver: Demand reduction
Time-of-Use Rates
Favor: Solar + storage
Target: Load shifting
ROI driver: Rate arbitrage
Flat Rates
Favor: CHP systems
Target: Efficiency
ROI driver: Total energy cost
Facility Characteristics
Load Profile
24/7 Operation
Favor: CHP systems
Constant base load
High capacity factor
Daytime Operation
Favor: Solar + storage
Peak aligned with sun
Lower night loads
Space Availability
Rooftop Available
Solar potential
Equipment location
Weight limitations
Ground Space
Generator placement
Fuel storage
Future expansion
Thermal Requirements
High Thermal Loads
CHP advantages
Defrost cycles
Space conditioning
Low Thermal Loads
Solar advantages
Electric focus
Minimal heat recovery
Operational Considerations
Redundancy Requirements
N+1 Configuration
Additional generator
Increased cost: 20-30%
Higher reliability
N Configuration
Base reliability
Lower cost
Grid backup
Maintenance Impact
Solar + Storage
Lower maintenance
Panel cleaning
Battery replacement
CHP Systems
Regular maintenance
Fuel management
Heat exchanger service
Hybrid Systems
Comprehensive maintenance
Multiple systems
Higher complexity
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