Understanding Differences Between AC and DC-Integrated Energy Storage Systems

Developing, designing, and successfully deploying energy storage systems can be a lot of work. From battery cabinets to power conversion systems (PCS) and energy management systems (EMS), battery systems are a complex mix of hardware, software, and acronyms.

In the procurement phase, buyers often don’t have the time, data at their fingertips, supplier access, or sufficient resources to compare market-wide AC- and DC-integrated energy storage systems (ESS). While some companies have an established preference for AC or DC products based on their risk appetite and contracting preferences, others may not be sure which option is the best choice for their project.

The good news is that evaluating products market-wide is now simplified. Within the Anza platform, buyers can now view 20+ AC- and DC ESS within seconds, comparing the total lifecycle cost of each option. Here’s a closer look at the differences between the two system types and how Anza makes it easier to compare all your options.

AC ESS: Ease of a single supplier

Many buyers today are familiar with AC products, where a fully integrated solution is purchased from a single counterparty, typically an Original Equipment Manufacturer (OEM) or specialized engineering firm. This system includes the hardware (battery cabinet, PCS), long-term service agreement (LTSA) components such as warranty, preventative maintenance, and capacity maintenance, and also sometimes includes software (EMS).

ESS contracts are complex and can be difficult and time consuming to negotiate the best terms for your project. For this reason, some buyers prefer purchasing AC-integrated energy storage systems, which requires contracting with only a single counterparty. Should an issue or warranty need arise down the road, there’s only one supplier that needs to be coordinated with.

With AC ESS, buyers with limited technical staff or resources may also benefit from a fully integrated system without doing the integration work themselves. However, the convenience of buying an AC-integrated ESS can come with higher costs as a result of added fees and surcharges from integrators. This tradeoff can be financially advantageous to some companies in place of added staffing resources.

Additionally, while comparing a few AC-integrated options by upfront costs is possible, gathering and analyzing warranty, preventative maintenance, and capacity maintenance costs, after determining the optimal strategy, can take months. Many buyers only consider a few AC-integrated options due to a lack of resources or tools necessary to analyze additional options. Often, buyers overlook better deals available in the market because of limited data or time.

DC-integrated ESS: More options can lead to lower cost

With a DC-integrated ESS, buyers purchase system components (battery cabinets, PCS, and EMS) from more than one counterparty, and integration work is required to deploy the system successfully. 

Like with AC-integrated systems, there are many nuances to consider when evaluating a DC-integrated ESS. By buying directly from manufacturers and integrating system components, buyers can establish direct relationships with suppliers and reduce upfront costs. Organizations with large, established teams have the resources necessary to negotiate with multiple counterparties and often prefer the control that comes with this negotiation process. Establishing and utilizing long-standing relationships with suppliers can make it easier for buyers to get what they need during contract negotiations.

On the other hand, it can be challenging for smaller businesses or lean teams with fewer resources to get suppliers’ attention when gathering all the commercial and technical data needed for each component. Multiply this time-consuming process by several vendors for each component required for a DC-integrated ESS, and you could be spending a lot of time tracking down data if you don’t already have strong supplier relationships or the right tools. 

Additionally, integrating systems requires significant technical expertise to deploy successfully. This can be another time-consuming and resource-intensive task that is only possible with experienced engineering support, leading to the need for external consultants and added costs to complete a project.

In an evolving tariff and policy landscape, some buyers prefer the risk mitigation benefits that come from buying from multiple suppliers instead of relying on a single supplier. Reducing supplier concentration risk also benefits your operating portfolio by lowering exposure to serial defects, underperformance, and limitations in both EMS and O&M providers. 

How Anza can help

Whether your company prefers AC- or DC-integrated energy storage systems, comparing all available options used to take countless hours of data collection and analysis and still only be a partial view of the market. Then, once you found the best products for your project, contract negotiations were time-consuming and filled with headaches.

Anza is here to help. Our one-of-a-kind data and analytics platform is the only resource in the industry where you can see a market-wide view of 20+ AC- and DC-integrated ESS product options available to compare in seconds. We rank all of these products by total lifecycle cost, which includes install cost, maintenance, augmentation, and warranties, saving you months of time and helping you know you’re getting the best deal.

Our scale and existing relationships can help you get the price and service from ESS suppliers you might not get on your own. With existing MSAs and pre-negotiated terms with many top-tier providers, you can get a better contract in place faster and the help you need to negotiate essential technical exhibits within your contracts.

Working with Anza, you also get support from our savvy engineering and strategic sourcing team, who have worked on over 65 energy storage projects from product due diligence to strategic sourcing. As a third-party resource for DC-integrated battery products, our team of experts will provide peace of mind through the process, assisting with each step from integration drawings to commissioning.

We recently helped a client with a 600 MWh storage project in Texas compare eight AC-integrated options, saving them months of time and enabling them to find the best option for their long-term storage asset ownership. As a lean and agile organization that prefers AC-integrated ESS, our client needed additional resources to gain further data points and comprehensively analyze their options. They valued Anza’s technical knowledge, commercial expertise, and ability to help them quickly navigate a complex and nuanced equipment selection process alongside an EPC evaluation.

Our team helped outline critical differences between the contract terms and commissioning support of the available options, enabling our client to make an optimal decision without expanding their internal resources. By comparing options based on total lifecycle cost and counterparty terms, our client was able to select a product option that improved their cash flows while mitigating risk, all in less time.

Through Anza’s data, technology, and expert team, we can help you find the optimal DC or AC-integrated product at a great price. Book a demo to learn more today!