Battery Energy Storage System: Explained Simply

• August 6, 2025
• Gaurav Joshi

Renewable energy is growing quickly. Every country wants to use more clean energy. For example, India plans to produce 500 gigawatts of energy from non-polluting sources by 2030. That would be half of the country’s total energy. But there’s a problem. Solar and wind energy are not always available when we need them the most. That’s where the Battery Energy Storage System (BESS) helps.

Table of Contents

1. What is a Battery Energy Storage System?
2. Why Do We Need Battery Energy Storage Systems?
3. How Does a Battery Energy Storage System Work?
4. Main Components of a Battery Energy Storage System
5. Where Can We Install Battery Energy Storage Systems?
6. Benefits of Battery Energy Storage Systems
7. Challenges of Battery Energy Storage Systems
8. Why Lithium-Ion Batteries Dominate the Market
9. Summary: Future of Battery Energy Storage Systems
10. Final Thoughts

What is a Battery Energy Storage System?

A Battery Energy Storage System stores extra electricity. It allows us to use solar or wind energy even when the sun is down or the wind is not blowing. Think of it like saving water in a tank to use later. When solar or wind plants produce more power than needed, the system stores that power. Later, during peak hours or when there’s no power, the system releases it.

This helps balance energy supply and demand. It also makes sure we do not waste the clean power we generate.

Why Do We Need Battery Energy Storage Systems?

Solar power peaks in the afternoon. But that’s not when energy demand is highest. In the evening, when people come home and turn on lights and appliances, demand increases. But by then, the sun has set.

Wind energy faces a similar issue. Sometimes it’s windy when demand is low, and calm when demand is high.

This mismatch leads to energy waste and an unstable power grid. A Battery Energy Storage System solves this by storing power when the supply is high and releasing it when demand increases.

How Does a Battery Energy Storage System Work?

The working is simple:

• Solar or wind plants generate power.
• If there is extra power, the system charges the batteries.
• When power is needed, the batteries discharge energy back into the grid.

This process supports the grid during peak hours. It improves efficiency and reduces waste.

Main Components of a Battery Energy Storage System

Several parts make a Battery Energy Storage System work well. Let’s look at each of them.

1. Battery Banks

These store the energy. Most systems today use lithium-ion batteries. They are compact, affordable, and efficient.

2. Inverter

Batteries store power as Direct Current (DC). Our homes and the grid use Alternating Current (AC). So, an inverter changes DC to AC.

3. DC Switchgear

These protect and control the DC power flow. Since power levels are high, safety is key.

4. Battery Management System (BMS)

The BMS keeps track of battery health. It checks charging, discharging, temperature, and performance. It also helps prevent problems and reports data to operators.

5. Thermal Management System (TMS)

Batteries heat up during use. The TMS controls their temperature. It uses natural cooling, fans, or even liquid cooling. This avoids overheating.

6. Transformer

After conversion, voltage is still low. A transformer increases it to match grid levels.

7. AC Switchgear

Like DC switchgear, it protects and controls AC power. It’s vital for safe connection to the grid.

8. Fire Suppression System

Because batteries can overheat, a fire suppression system is essential. It detects fire and puts it out quickly.

Where Can We Install Battery Energy Storage Systems?

These systems are flexible. We can install them in several locations:

Transmission and Distribution Networks

We can place BESS between power stations and homes. It helps store power and release it when needed. This reduces the load on the grid.

Near the Load

Placing BESS close to factories or buildings avoids power loss during transmission. It’s useful in industries where power cuts can cause big losses.

With Renewable Power Plants

Installing BESS near solar or wind plants helps store power right at the source. The stored power can be sent to the grid during peak demand.

Inside Thermal Power Plants

Some setups even place BESS inside thermal power plants. It helps store excess power and improves plant efficiency during low-resource times.

Benefits of Battery Energy Storage Systems

A Battery Energy Storage System offers many advantages. Let’s look at the key ones.

Reduces Fossil Fuel Use

It helps us use more clean energy and less coal or gas. This lowers pollution and protects the environment.

Improves Grid Stability

With a better supply and demand balance, the grid remains stable. No need for sudden load shedding or power cuts.

Saves Money

Electricity costs more during peak hours. By using stored power at that time, industries and homes can save money.

Increases Energy Efficiency

It ensures we don’t waste the power generated. More efficient energy use means fewer resources are wasted.

Challenges of Battery Energy Storage Systems

Despite the benefits, there are some challenges.

Large Space Requirement

Current BESS setups use large containers, often 20 feet long. Many containers must connect in a row. This takes up a lot of land.

Battery Discharge and Internal Losses

Batteries lose charge even when not used. This is due to internal resistance. So, energy stored is not always equal to energy released.

Why Lithium-Ion Batteries Dominate the Market

Lithium-ion batteries are now the most used in BESS. Why?

• They are affordable.
• They are produced in large numbers.
• Their cost has dropped by over 70% in the last 10 years.
• They are reliable for storing energy for 1–4 hours.

Other battery types exist. Some store power longer but are more expensive. As technology improves, we may see more choices in the future.

Summary: Future of Battery Energy Storage Systems

The future of energy depends on how well we store it. A Battery Energy Storage System helps us use renewable energy in a smarter way. It lets us store power when it’s available and use it when needed.

From homes to industries, and from cities to remote locations, BESS can change how we manage energy. By storing power smartly, it makes renewable sources more reliable. This technology also helps keep the grid stable, reduce costs, and support our shift toward a cleaner future.

Final Thoughts

As demand for clean energy grows, Battery Energy Storage Systems will play a key role. They help us solve one of the biggest problems of renewables, timing. With better batteries, smarter systems, and lower costs, the future looks bright.

Let’s invest in smarter solutions. Let’s power the future.