Batteries are key components of a smart grid system that enable utilities contend with the intermittent supply of renewable energy from solar cells, for example. Now, businesses as well can deploy batteries to help manage their energy use.

Earlier this month, SolarCity unveiled a smart-energy storage system based on Tesla battery technology. The company said the system addresses two major pain points for business: rising utility demand charges and increasing grid outages. The new system, called SolarCity DemandLogic, can allow businesses to reduce energy costs by using stored electricity to reduce peak demand and can provide backup during power outages. System software automates the discharge of stored energy to optimize utility charge savings.

“Utilities have altered their rate structures such that demand charges are rising faster than overall energy rates, and businesses are bearing the bulk of those increases,” said Peter Rive, SolarCity’s chief technology officer and chief operations officer, in a press release. “Time is money, but so are control and predictability. Our storage systems can give businesses the tools to address all three—delivering immediate savings, protection against escalating demand charges and optional, grid-independent backup power in case of outages.”

Tesla CTO and co-founder JB Straubel added, “We are thrilled to leverage Tesla’s technology leadership in energy storage systems, charging and power electronics to enable this exciting SolarCity launch. The economics and scale that Tesla has achieved in the automotive market now make stationary energy storage more cost effective and reliable than it has ever been in the past. We expect this market to grow very rapidly now that we have crossed this economic threshold.”

SolarCity noted that the U.S. experienced 679 major weather-related power outages between 2003 and 2012. In addition, the company said, utility revenues in the U.S. have increased 50% since 2001, although electricity usage has increased only about 10%, according to the U.S. Energy Information Administration. The discrepancy is due in part to utilities' "demand charges"—in which rates are based less on total energy used and more on peak demand.

The company said its commercial storage system regulates the amount of electricity that organizations need from the grid during peak periods, reducing exposure to exorbitant demand charges.

The company also offers energy storage for homes.