Renewable energy is energy derived naturally from sources that can be replenished, such as sunlight, wind, biomass, waves, petroleum, and water. As the world increasingly focuses on renewable energy, the use of solar photovoltaic (PV) systems together with battery energy storage systems (BESS) has become more prominent in commercial building energy systems. Solar PV systems generate electricity directly from sunlight [1] . Malaysia is fortunate to have abundant solar energy due to its favorable climate for electricity generation. The country benefits from strong solar radiation and plenty of sunshine throughout the year [2] . As a result, solar PV systems are well-suited for homes, industries, and commercial buildings. Commercial buildings, in particular, gain significant advantages from solar PV systems as they help lower costs while reducing environmental impact.

Commercial buildings often have large rooftop spaces suitable for installing solar PV systems. These systems can be connected to the grid, reduce reliance on grid electricity, supply part of the building’s energy demand, and lower overall energy costs. For the solar PV system to operate efficiently, both a hybrid inverter and a battery energy storage system (BESS) are required. Unlike a standard inverter, a hybrid inverter offers multiple operating modes. It can store surplus energy from the solar panels in the battery and also export excess power to the grid, depending on the selected mode and application. One useful feature is the peak shaving mode, which activates when energy consumption exceeds a preset limit. In this mode, the battery discharges to bring consumption back within the limit, reducing peak demand and associated charges. The battery automatically charges and discharges based on the configured settings.

Most electricity production relies on fossil fuels such as coal and natural gas. The price of coal is rising steadily, exacerbated by fluctuating currency exchange rates, further driving up costs for the energy sector [3] . According to the National Energy Transition Roadmap, the goal is to transition from fossil fuel energy to renewable energy. In line with developing a low-carbon economy, environmental conservation, and resource efficiency through green growth, it is noted that 80 percent of greenhouse gas emissions come from the energy sector. By 2050, the country aims to increase the target for renewable energy capacity installation to 70 percent, up from 40 percent in 2040, and achieve net zero emissions. One key renewable and clean energy source is solar power, which harnesses sunlight [4] . There are various strategies to efficiently reduce power consumption and tackle high energy tariff costs. The rising trend in solar energy adoption is driven by its application across domestic, commercial, and industrial buildings [5] . Peak shaving is employed to lower power consumption during peak hours, thereby avoiding demand surges and reducing energy bills. Battery Energy Storage Systems (BESS) play a crucial role in balancing renewable energy supply and electricity demand, as they can release stored energy during periods of high demand. Most electricity generation still depends on fossil fuels such as coal and natural gas. Coal prices have been steadily increasing, and fluctuating currency exchange rates have further raised costs for the energy sector [3] . According to the National Energy Transition Roadmap, the country aims to shift from fossil fuel–based energy to renewable energy as part of efforts to build a lowcarbon economy, protect the environment, and improve resource efficiency through green growth. This transition is crucial because about 80% of greenhouse gas emissions come from the energy sector. By 2050, the target is to raise the installed renewable energy capacity to 70%, up from 40% in 2040, and achieve netzero emissions. Solar power stands out as a major renewable and clean energy source that harnesses sunlight [4] . Several strategies can help reduce energy consumption and tackle high electricity tariff costs. The adoption of solar energy is rapidly growing across residential, commercial, and industrial buildings [5] . Peak shaving is one such strategy, used to reduce power demand during peak periods, thereby avoiding surges and lowering energy bills. Battery energy storage systems (BESS) are vital in balancing renewable energy supply and electricity demand because they can release stored energy when demand is high [6] .

Poor energy management in commercial buildings often leads to financial losses and higher carbon emissions. Many solar energy systems are designed using only average load profiles, without fully understanding the building’s actual load patterns [7] . As a result, high maximum demand charges become a major source of financial loss. To ensure optimal system performance, inverter parameter settings must be carefully configured to match the building’s needs [8] . Key data such as peak load, peak times, average energy consumption, and non-peak current load are essential for selecting the appropriate inverter mode. Using this data allows for better parameter settings and system specifications, helping to maximize cost savings, reduce carbon emissions, and conserve energy.

The most promising renewable energy source for generating electricity is photovoltaic (PV), which is gaining popularity among power systems due to its affordability and outstanding performance. PV is widely used in practical applications such as communication systems, space technology, autonomous lighting systems, battery charging and domestic power applications [9] . Solar panels can be installed on the roof of buildings or in nearby areas and can be installed to generate clean energy from sunlight. In addition, if the building is in good condition, wind turbines can also be used to provide a continuous supply of clean electricity. This renewable energy source reduces dependence on fossil fuels and greenhouse gas emission.

However, because it depends on the weather, the production of renewable energy is intermittent. Battery energy storage system is useful in this situation. BESS makes it possible to store extra energy produced from renewable sources for later consumption. When there is a low production of renewable energy or a large demand for energy, the stored energy may be used to provide a steady and dependable power supply. Battery energy storage systems (BESS) are a valid complement to renewable energy systems. By increasing the reliability of the entire supply system, they minimize the need for emergency energy reserves [10] .

This section discusses the hybrid inverter and battery energy storage system performance, detailing the components used and the system’s operation once activated. It also examines the evolution of technology and concepts since their inception. Additionally, the discussion will be focusing on the various operating modes of the inverter and their functionalities. A thorough understanding of each concept and component function is essential for effectively analyzing the system’s performance in the context of this research.

A hybrid inverter is a type of inverter used in grid-connected microgrid systems that combine hybrid photovoltaic (PV) and battery energy storage systems (BESS). Its purpose is to manage the flow of power between the main grid, battery storage, and the PV system. Hybrid inverters facilitate the integration of renewable energy sources, like solar energy from PV systems, and the storage of excess energy in batteries. They allow the system to operate in both grid-connected and off-grid modes, enhancing the flexibility and reliability of the power supply. In hybrid mode, the hybrid inverter can seamlessly switch between multiple power sources solar, battery, and grid power to optimize energy output and consumption [11] . A diagram solar power system with hybrid inverter and battery energy storage is shown in Figure 1 [ 12] .

Battery Energy Storage System (BESS) is a system that uses batteries to store electrical energy for later use according to the user's needs. Energy storage systems provide a variety of technical options for managing power flows to build more durable energy infrastructure, save money for consumers, reduce consumption and improve energy efficiency . BESS will often be used in renewable energy systems such as wind energy and solar energy. This is because renewable energy is not constant or intermittent because it depends on the weather. This battery system can link to the grid and release the stored energy to reduce the grid demand . Battery energy storage systems must be appropriately kept there to release energy when needed or in the scenarios desired by the customers. This is where energy management needs to be implemented into BESS, the example such as state of charges (SOC), peak shaving, load shifting, energy arbitrage, and solar PV generation .

The flowchart as shown in Figure 2 presents a methodology for evaluating a hybrid photovoltaic (PV) and battery energy storage system (BESS). It begins with understanding the PV-BESS setup and inverter modes, followed by selecting an operation mode—Peak Shaving, General, or Economic—and collecting relevant data from the SEMS portal. The next steps involve calculating daily total energy consumption and maximum demand, recording energy-related data in Excel, and analyzing key parameters such as load consumption, cost savings, load factor, maximum demand, and CO₂ reduction. The process is repeated for all selected modes until complete, after which the findings from each mode are compared to determine the optimal configuration, concluding the evaluation. The next subsection discusses each component related to this project such as solar panel, hybrid inverter, BESS, electrical loads and GoodWe SEMS Portal.

The main objective of this chapter is to analyze the load profile of the FTKE’s Solar Laboratory with and without hybrid inverter of PV and BESS system using different control modes. There are three (3) inverter control modes considered in this study to find the opportunities for energy savings, cost savings, PV Generation, maximum demand, load factor and CO₂ reduction. The significant findings from the analysis can conclude the best option of control mode of hybrid inverter of PV and BESS to maximize the energy and cost saving.

This project demonstrates the optimal energy management of a hybrid photovoltaic (PV) and battery energy storage system (BESS) inverter installed at the FTKE Solar Laboratory. Three inverter control modes—Peak Shaving, General, and Economic—were evaluated based on load profile, energy savings, cost savings, maximum demand, and CO₂ emission reduction. Energy consumption was analyzed for each mode with and without the hybrid inverter system.

The objectives of this project were successfully achieved, yielding significant findings. Energy savings resulted from the reduction in grid energy consumption when using the hybrid inverter PV-BESS system. The highest energy saving was achieved in General mode (441.94 kWh), followed by Economic mode (400.12 kWh), while the lowest saving was recorded in Peak Shaving mode (386.64 kWh). The results indicate that energy savings depend on PV generation and the frequency of battery charging.

Overall, the hybrid PV-BESS inverter significantly reduces energy consumption and costs while supporting sustainable energy management. Optimal results can be achieved by selecting the inverter mode based on PV generation availability and load profiles, ensuring flexible and efficient operation tailored to user needs. For commercial buildings, building managers can select the General mode to maximize energy savings, the Peak Shaving mode to reduce costs under high-demand tariffs, or the Economic mode to balance both objectives according to their utility tariff structure and sustainability goals. However, these findings are based on a single building with a load profile dominated by air-conditioning in one climate location. As such, the results may vary for buildings with different load characteristics, occupancy patterns, or in regions with differing solar resources and tariff structures.

The authors would like to express their sincere gratitude to Universiti Teknikal Malaysia Melaka (UTeM) for providing the financial support and research facilities that made this project possible. The resources and guidance provided have been invaluable in ensuring the successful completion of this study. This work directly supports the aspirations of the United Nations Sustainable Development Goals (SDGs), particularly SDG 7 (Affordable and Clean Energy) through the promotion of renewable energy integration, SDG 11 (Sustainable Cities and Communities) by fostering energy-efficient infrastructure, and SDG 13 (Climate Action) through the reduction of carbon emissions and advancement of sustainable energy practices.