Backup Power for Commercial Buildings  

Market drivers, code requirements, and fuel options for backup power

Sponsored by Propane Education and Research Council | By Amanda C. Voss, MPP

Photo courtesy of The Propane Education & Research Council 

Power outages are not only disruptive, but they can also jeopardize critical operations for commercial facilities. Reliable, clean backup power kept on site offers a robust resilience strategy for businesses. 

 

Weather alerts signaling approaching strong storms and damaging winds. The searing heat on a summer day. News of a local wildfire. All of these common occurrences can trigger power blackouts or rolling brownouts that profoundly affect commercial businesses. 

Implications of power outages in commercial buildings include cost impacts, lost productivity, lost sales, loss of product, brand damage, and even life safety risks. On February 17, 2025, students at Murray State University in Kentucky petitioned to hold the school accountable for “negligent infrastructure” after power loss from a lightning strike.1 Dormitories on campus were without heating, light, and hot water for several days.

Integrating a backup power system into a commercial building’s infrastructure offers significant advantages. These systems not only ensure resilience, reliability, and safety, but they can also contribute to environmental conservation and economic efficiency.

 

What is Backup Power? 

To start, it is important to define the general concept of backup power. A basic definition of backup power is an additional power source that can be used in the event of a power failure. When the design professional considers the incredible number of building systems, appliances, office tools, and other equipment that are powered by and reliant on electricity, they get a sense of the impact of a power outage.  According to an EnergySage study in 2024,2 the average financial loss to businesses due to power outages is estimated to be around $150 billion annually in the United States, with the exact cost depending on the business size and duration of the outage. 

General Forms of Backup Power 

Most businesses select backup power technology in the form of a generator, which is essentially an engine that burns fuel to create electricity. Generators are an extremely common backup power technology with a long history. They come in many different sizes and capacities that can burn different fuel sources; in some cases, a generator can even operate on multiple fuels. Each fuel configuration has advantages and disadvantages, but the good news for designers and specifiers is that there is a wide range of options available. 

Another backup power technology is stored power, such as on-site batteries. This type of technology is often used in a “UPS,” or Uninterruptible Power Supply. The role of a UPS is to provide instantaneous backup power until other sources, like a generator, are brought online, or to provide just enough power to allow a system to safely shut down. UPS systems are typically deployed for critical systems in IT, communications, and healthcare, where even momentary loss of power causes serious problems.

Image courtesy of The Propane Education & Research Council

Backup power technology can be divided into generator-based and stored power technologies. 

 

The History of Generator-Based Backup Power 

Generators are used to produce AC current. Generator technology began with the discovery of electromagnetic induction, which paved the way for modern generators and their commercial use. Generator design improved dramatically in the 1890s, with Westinghouse, Siemens, Oerlikon, and GE creating some of the most powerful generators of their time. 

The manufacturer Kohler got its start making small-scale generators for homes in the years immediately following World War I. The company leveraged the emerging demand for electricity on farms and their expertise in cast iron to produce the revolutionary Kohler Automatic Power & Light “power plant” in 1920. This unit furnished an unprecedented 110 volts directly to power lines, turning itself on and off automatically in response to the demand for electricity. 

Having the ability to harness power on demand gave farmers access to not just lights but also running water and electric appliances. Adding these conveniences to daily life was revolutionary for many people. The growth of electrical equipment and appliances has only expanded in modern times, with residential and commercial buildings now completely reliant on such technologies.

 

Codes and Standards for Backup Power 

Photo courtesy of The Propane Education & Research Council 

Numerous standards and testing requirements ensure the efficacy of backup power systems. 

 

There are numerous powerful motivations for commercial buildings to include backup power systems. About 75% of commercial businesses in the United States have backup generators.6

Besides businesses selecting “optional” backup power applications, there are many commercial buildings where building codes and standards dictate that backup power must be used. These codes also govern how the systems are to be designed. 

Image courtesy of The Propane Education & Research Council 

The National Electric Code (NEC) governs backup power systems and adheres to specific terminology. 

 

So far, systems have been loosely grouped using the term “backup power” as a general description of a generator supplying power in case of an outage. However, codes and standards that dictate the use and design of different types of systems use very specific terminology. Different categories of backup power within the code mean very different things.

Relevant Codes: The NEC 

The National Electric Code (NEC) is also known as “NFPA 70” or the National Fire Protection Association’s Standard 70. The NEC addresses the installation of electrical components; signaling and communications systems; and optical fiber systems in commercial, residential, and industrial occupancies.

Within the NEC, there are some key terms relevant to backup power: 

  • An “emergency system” covers systems essential for the safety of human life. These systems are legally required and classified as “emergency” by municipal, state, federal, or by a governmental agency having jurisdiction. These systems generally provide power to egress lighting, fire detection and protection, certain types of elevators, public safety communications, or any system where loss of power would cause serious endangerment to life or health within 10 seconds of normal power loss.
  • “Legally required standby power systems” are backup power required by code depending on building use and occupancy. They may power communications, selected ventilation or smoke removal systems, lighting, or certain types of industrial processes that may create hazards or hamper firefighting operations if power is not available.  These must be available within 60 seconds of normal power loss.
  • “Optional standby systems” are backup power systems that an owner may optionally require if their business practices dictate the necessity. Such systems generally consist of loads that do not affect life safety but could have an unacceptable consequence of financial or operational losses. Loads may include data processing, communication systems, refrigeration, or other imperative performance needs. 
  • “Critical operation power systems” (COPS) are the newest classification of backup power for systems, operations, or facilities designated by local, state, and federal government as “mission critical.” These may include police stations, fire stations, and other facilities that serve public safety, national security, or business continuity. There are also additional commissioning requirements for COPS.

Relevant Codes: IFC and IBC 

The International Fire Code (IFC) and International Building Code (IBC) are two major building codes that dictate specific requirements for commercial buildings.   

The IFC and IBC requirements for emergency and standby power are coordinated with each other. Both of these codes refer back to the NEC for specific installation requirements for electrical systems.

The code requirements for emergency or standby power are based on the building’s use and its occupancy.  Emergency Power Systems are required by the IFC and IBC for high-rise buildings as well as other buildings designated by the jurisdiction.

Standby Power Systems are required by codes for covered mall buildings, high-rise buildings, atriums, and other designated structures.

These are a few of the building uses and occupancies listed in the codes as requiring some form of backup power. Note that IFC and IBC codes can actually require that both Emergency Power and Standby Power systems are installed in certain buildings, such as high rises. In all cases, it is important to thoroughly review the local code requirements to determine which types of backup power are needed.

Code and Emergency Power Categories and Characteristics 

After determining the building use and occupancy to see what types of backup power is required by code, codes may also dictate the specifics of what it takes to provide that power.  

Within Article 700 of the NEC, Emergency Power must have on-site fuel storage and be available within 10 seconds of a power failure, and testing of the system will be required.

The on-site fuel requirement is very important. Because this is an Emergency Power application, on-site fuel storage ensures that the generator is ready to operate and won’t be subject to any upstream fuel reliability issues. In the past, this requirement was typically met by using diesel fuel stored on site. Today, propane stored on-site provides an excellent and environmentally friendly alternative.  

Required acceptance testing is done upon installation, as well as periodic operational testing to maintain the system, should it ever need to be activated. 

Image courtesy of The Propane Education & Research Council 

The physical requirements, per code, for the Emergency Power system. 

 

The loads that need to be supported by emergency power based on the code include:

  • Emergency communication
  • Smoke detectors
  • Fire alarms
  • Standpipes
  • Egress lighting
  • Exit signs

All these loads must be available within the 10-second switchover.

When the code requires a Legally Required Standby Power system, refer to Article 701 in the NEC.  This section of the NEC designates the requirements of the legally required standby power system, which will power systems or components that otherwise may create a hazard or hamper firefighting operations if they are not powered. The power from Legally Required Standby Power systems must be available within 60 seconds of a power failure and require testing of the system.  

While there is not an on-site fuel requirement for Legally Required Standby Power, having this additional design measure adds reliability to the system. As with emergency power, legally required standby power requires that acceptance testing is performed upon installation, as well as periodic operation testing to maintain the system should it ever need to be activated. 

The building systems that are required by code to be on standby power within the 60-second timeframe include:

  • Ventilation systems;
  • Elevators (or conveying systems);
  • Fire command systems; and
  • Access, which may include electronically controlled doors and windows.

Again, these are systems within the building that, if not powered, may create a hazard or may hamper firefighting operations.

“Factory acceptance testing” offers a valuable strategy for some of the required testing, including for legally required standby power, as well as other forms of backup power. Factory acceptance testing takes place at the generator manufacturer’s facility. This is easier to coordinate, as compared to the project site, and also helps in preparation for on-site testing required by the authority having jurisdiction.

Note that many buildings, especially hospitals, will require both Emergency Power (NEC 700) as well as Legally Required Standby Power (NEC 701) and perhaps other loads supported by standby systems. In buildings like this, load prioritization is an impactful part of the system design to ensure that the 700 and 701 loads are satisfied.

Optional Standby Power Systems are governed by Article 702 in the NEC. Optional standby power is less regulated by building codes like IBC and IFC. The design of these systems is driven more by the building owner’s wants and needs, for instance, to keep a data center running or maintain refrigeration. They can also be designed to power any equipment that the owner deems would create a financial, operational, or other significant business loss if it lost power. Optional Standby Power Systems usually cover loads that generally don’t affect life safety or firefighters’ operational needs. Response time and testing of the standby system are specifications set by the owner based on their needs. Fuel for the standby system is also the owner’s choice, but remember that on-site fuel is the most reliable. In some cases, a hybrid system that uses natural gas, not an on-site fuel, along with a fuel stored on-site like propane, provides optimal benefits.

Critical Operations Power Systems, or COPS, are essentially “mission critical” systems that can actually include all three types of the previously mentioned backup power systems, meaning emergency power, legally required standby power, and optional standby power. COPS are regulated by Article 708 in the NEC.

COPS are determined by the local, state, or federal governmen and are generally installed in vital infrastructure facilities that, if destroyed or incapacitated, would disrupt national security, the economy, public health, or safety. They are also installed where enhanced electrical infrastructure for continuity of operation has been deemed necessary by a governmental authority.

The biggest difference for COPS systems is the requirement that the system can operate for 72 hours at full load capacity, with enough fuel stored on-site to meet this requirement. Emergency and/or standby generators can be used as the alternate source of power in COPS. Storing enough fuel on-site for 72 hours of full load run time will dictate the generator’s fuel tank size.  

COPS systems must also be commissioned prior to being put online, with periodic commissioning to occur as well. These requirements are in addition to the previous requirements for each of the other backup power systems.

EPA Emissions Requirements for Generators 

The U.S. Environmental Protection Agency (EPA) also regulates backup power systems. It has set increasingly stringent emissions requirements for non-road engines and equipment. Tier 1 was enacted in 1994, with Tiers 2 and 3 following in the years thereafter. Tier 4 was enacted in 2004, with a number of continuing revisions applied to this day. Overall, this framework has established requirements for increasingly clean exhaust systems.  

A very important note is that different EPA emission requirements (Tiers) will apply based upon the type of backup power system installed. For example, if an Emergency Power system meets the EPA’s definition of an emergency power generator, meaning it only runs for purposes of backup when the grid power goes offline, then the system will have to meet Tier 2 or 3 requirements. These less stringent emission tiers apply because the generator’s run time isn’t too extensive.  

For non-emergency generators, like a system that runs on a regular basis to shave peak loads at a facility to lower utility costs, the generator run time will be much greater, and Tier 4 emissions will apply.  

Therefore, the way in which the EPA regulations categorize a backup power system is significant and can have implications for the equipment specifications. 

For a given project, the details on how emissions requirements will affect system design and specs can be coordinated with the generator manufacturer and the electrical engineer. The EPA also has extensive information on the emissions tiers available online.

 

Fuel Options and Environmental Concerns When Providing Emergency and Standby Power 

Traditionally, diesel has been the choice in most backup power applications, but today, there are additional fuel options for designers and specifiers, each with inherent benefits. Stakeholders can now help to optimize their backup power system’s performance and costs through their fuel selection. 

Diesel

Diesel remains the most common fuel choice for commercial buildings, yet it presents dependability challenges. Diesel is cost-effective for larger, single-engine applications over 150 kW. It also provides a good option for on-site fuel storage, a system feature that is required in Emergency Power applications. Diesel generators are also able to match their power output as they face variable loads.

Perhaps the most significant challenge for diesel systems is the stability of the diesel fuel. Diesel degrades over time via oxidation, which leads to the formation of sediments and gum that can clog fuel filters and injectors if not treated. Condensation in the fuel system can also lead to bacteria growth, which can cause clogging. Thus, diesel storage systems require either manual regimens or automatic fuel maintenance systems to keep the system reliable. In fact, for emergency applications, fuel maintenance is required by code within NFPA 110. The need for either automatic fuel maintenance systems or manual operations increases the total ownership cost of the diesel system, a factor to include in the evaluation of fuel and equipment options. 

Diesel generators are covered by EPA emission regulations. As described in the previous sections, it’s especially important to understand which regulations apply based on the exact backup power application. The implications of which regulations apply can have a significant impact on costs. 

Natural Gas 

Natural gas-powered systems previously had durability issues as well as concerns about the fuel’s power density.  However, recent innovations have greatly improved the performance and power of natural gas generators. Examples include engine speed optimization, optimized air/fuel mixtures, and improved transient performance. Natural gas is growing in popularity, with 28% of commercial generator systems running on natural gas.

Key benefits of natural gas generators include good cost-effectiveness for smaller, single-engine applications. For larger applications, paralleling generators can satisfy loads over 150 kW, and because the fuel source is utility-supplied and not stored on-site, long run times are possible without re-fueling concerns. The environmental profile of a natural gas generator is favorable, with lower NOx and particulate matter emissions compared to a similar capacity diesel system. Fuel stability is also not an issue as it is for diesel.

Challenges for natural gas generators include the technology’s cost effectiveness for large single engine applications. Interestingly, the most significant challenges are related to some of natural gas’s benefits. The fuel is supplied by a utility and not stored on-site. This provides some advantages, but it also means there’s no on-site storage when this is a system requirement. While natural gas utilities are typically very reliable, the delivery infrastructure is not always 100% reliable, particularly during natural disasters. Outages could occur, or some buildings could be subject to curtailment based on the utility’s operating policies. Also, in seismic regions, natural gas distribution will be shut down during a seismic event, cutting off supply.  

These reliability issues can be evaluated by the project team to better understand their likelihood and significance. Hybrid natural gas/propane systems are an effective option that can be used to alleviate the gas supply reliability issues. 

Propane 

Propane, often called “LP,” is another fuel choice option. Propane offers many of the same benefits as natural gas, including its cost-effectiveness for smaller single-engine applications. Unlike natural gas, propane is stored on site. This characteristic makes it an alternative to diesel when on-site fuel storage is either required or desired. Propane can also serve many other applications in the building. Any type of system or appliance that could be served by natural gas readily accepts propane as a fuel. Some of the most common propane applications in commercial buildings include water heating, space heating, clothes dryers, and fireplaces, which are all applications where propane offers distinct cost and environmental advantages over electric options.

In terms of fuel stability, propane does not degrade or oxidize over time like diesel. These factors mean there are no fuel maintenance issues with propane, which can be a major cost and operational benefit in backup power systems that either require or prefer on-site fuel storage.

Propane’s environmental profile is also favorable compared to diesel, with lower NOx, particulate matter, and CO2 emissions. These benefits are likely to become more significant over time as emissions standards continue to grow more stringent.

In terms of fuel cost, propane production has grown significantly. This ample supply means that propane is competitively priced with diesel fuel in the engine fuels market.  Challenges with propane generator systems include lower cost effectiveness for large, single-engine applications. Design options for propane systems include running the system with the propane entering the engine as either a vapor or a liquid. Vapor configurations offer some advantages and need to account for the vaporization rate of the propane from a liquid into a gaseous form, based on several variables. Generator manufacturers offer design support to account for these factors in the system design.

Propane tanks can provide on-site propane storage for backup power systems of any size. Determining the minimum required on-site storage involves looking at the generator’s fuel consumption rate and its specified run time to arrive at how many gallons of storage are needed. For example, a 60-kilowatt generator that serves a medium-sized commercial building, running at full load, will consume about 9 gallons of propane per hour and 215 gallons over an entire day. Keep in mind that it’s unlikely a generator will run at full load for an extended period, which will decrease the consumption rate. Because of its efficiency, storing enough propane on-site for backup power is readily accomplished. Propane storage tank sizes range from 125-gallon tanks for spot energy needs all the way up to 120,000-gallon storage tanks. One tank can be sized to serve all of a building’s gas energy needs based on its total maximum load, or multiple smaller tanks can be manifolded together. For the 60 kW generator in the example, a stan1000-gallonallon tank would likely be suitable.

NFPA Standard 58 establishes the industry requirements for tank and underground gas line installation. Working in accordance with NFPA 58, the propane supplier involved in the project can determine the proper size and number of tanks to meet the building’s loads. Tanks can be fenced, buried, or landscaped to enhance security, safety, and aesthetics.

Image courtesy of The Propane Education & Research Council 

Propane tanks can provide on-site propane storage for backup power systems of any size. NFPA Standard 58 establishes industry requirements for propane tanks. 

 

Multi-Source 

Multi-source backup power systems offer another option where the system utilizes multiple fuels to optimize costs, performance, and code compliance.

A dual fuel system will typically utilize natural gas fuel for the generator’s operation. The dual fuel system is also designed for propane supply and combustion and is fed by on-site propane. If the natural gas supply is cut off for any reason, the system switches over to propane. This type of design takes advantage of the utility-supplied advantages of natural gas, as well as the on-site security and storage benefits of propane, compared to diesel.

Bi-fuel designs are used in larger applications. In these systems, diesel and natural gas are combusted simultaneously. The diesel leads off the operation, and then the system gradually integrates natural gas, 

which is actually ignited by the diesel. The system’s controls optimize the proportion of the two fuels to roughly a 3:1 proportion between natural gas and diesel. While these systems come at a cost premium, this fuel mix optimizes the use of both natural gas and diesel.

Conclusion 

With the nation’s electrical grid under frequent assault by increasingly intense storms, many businesses are turning to backup generators for an uninterrupted power supply. This is especially true in vulnerable coastal areas and inland tornado alleys.

Put simply, there are cleaner alternatives to traditional diesel-powered generators. Backup power that uses propane or dual fuel captures many sustainable benefits. Propane standby generators offer a powerful, reliable way to protect buildings and businesses from the damage a power outage can cause.  Propane is a low-carbon energy source that produces fewer harmful emissions than competing fuels. According to the US Office of Energy Efficiency and Renewable Energy (EERE), 52% fewer greenhouse gas emissions are released when using propane, as compared to an equivalent amount of electricity generated from the U.S. grid.7 In comparison to other widely used fuels, the US Energy Information Administration (EIA) shows that propane offers one of the lowest carbon emissions per million BTUs.8 Generators that operate on propane have proven to be environmentally friendly relative to diesel. Tailpipe emissions from propane generators are significantly lower in two air-pollution categories: NOx and PM. Choosing propane secures forward-thinking environmental benefits, including reduced greenhouse gas and NOx emissions, as well as lowered energy costs and more efficient performance. Since propane is designed to be safely delivered and stored on site, it offers energy security. The security, efficiency, and environmental profile of propane provides it with unique advantages as a backup fuel source.

 

Why Do Commercial Buildings Use Backup Power? 

Photo courtesy of The Propane Education & Research Council 

Power outages from storms and other causes are on the rise. Backup power allows businesses to avoid losses and keep operating safely. 

 

There are many reasons a commercial building may select backup power: code requirements,  redundancy, enhanced energy or cost savings, energy independence, decentralized supply, environmental benefits, or simply to ensure uninterrupted power supply. The first decision point for owners and projects is related to optional backup power applications, often used in buildings where there is not a code or jurisdictional requirement mandating that a building use backup power. Even without this requirement, there may be other very good reasons for owners and occupants to consider the use of a backup system.  

Buildings provide a wide range of functions. When these functions are interrupted by power outages, an extensive set of negative outcomes result. Outages cause widespread financial impacts. 

A 2021 report from S&C Electric Company3 covered a survey of facilities and energy managers of commercial and industrial (C&I) businesses across the United States. Survey data revealed “a dramatic increase in companies reporting short-duration outages as their most common power outage. Companies affected by momentary outages lasting less than five minutes jumped from 20 percent to 40 percent in one year, signifying that outages are becoming more prevalent and noticeable because of their impact on operations. The report also uncovered that 44 percent of companies lost power monthly or more frequently—double the percentage from  2020—indicating companies are seeing more negative impacts that could jeopardize critical operations and potentially risk their reputations as reliable goods-and-services providers. Survey data showed a typical outage cost $100,000 or more for nearly one-quarter (22 percent) of companies. Most (80 percent) of these C&I companies experienced monthly outages, resulting in an annual loss of $1.2 million. 

Of the various industry segments, the education sector experiences the most in terms of outage frequency, with 7% of that sector encountering an outage once a week. More than a quarter of the manufacturing industry deals with an outage at least once a month. In this same research, respondents said that power outages can have a significant impact on the reputation of their business. The types of impacts will vary by both building type and industry. For example, a luxury hotel or restaurant is very sensitive to a damaged reputation. For the healthcare industry, 58% of respondents shared that outages resulted in losing customers and affecting their patients’ satisfaction. For small franchises, the aftermath of outages for 62% of these customers meant lost sales and cancelled orders.4

Power outages can result in major financial losses for food providers. For example, a storm in Washington State created widespread power outages that lasted for several days. A small Ben & Jerry’s establishment received their usual shipment of fresh ice cream, only to suffer a three-day power outage shortly after. By the end of the multiday power outage, the store had lost about half of its ice cream, as employees were only able to protect half with dry ice, leading to an estimated $60,000 in losses.5 

A two-hour power outage at a New Mexico Intel manufacturing facility, caused by a 500-acre brush fire near a power generation station, resulted in a half a week of lost production. Facility equipment was damaged, and an additional 24-hour delay was then experienced waiting for repair parts.

Power outages and their impacts are well documented. At the same time, the building industry has increasingly pursued more resilient designs and systems to help clients withstand outages and perform through other challenges, such as natural disasters.

As a growing element of resilient design, installing permanent backup generators is one common building resilience strategy. The use of permanently installed backup power generators is also increasing significantly. 

 

Stibnite Gold Project

 

Photo courtesy of The Propane Education & Research Council 

While EPA regulations for generators are not usually at the forefront of a design professional’s mind, they can immensely impact the design of a project. 

 

Despite nearly a century of mining activity, the Stibnite Gold Project in central Idaho contains valuable deposits of gold and other minerals, such as antimony. A mineral exploration firm set up a camp on the site, which it has been studying since 2009 with the goal of opening a world-class mine. The camp includes a core shed, a maintenance shop, a fuel depot, several office trailers, and a handful of year-round staff members.

The exploration camp is remote, even by Idaho standards. It is located 100 miles northeast of Boise, along the boundaries of the Frank Church Wilderness, and the nearest electrical grid power is 15 miles away, in the 60-person town of Yellow Pine.

The mineral exploration firm plans to connect to the grid when all the permits are secured. In the meantime, the camp must use onsite power generation. Initially, that meant using large, fuel-hungry diesel generators to power the camp’s lighting, computers, engine block heaters, and other essential equipment. In addition to being expensive, the malodorous, inefficient diesel units were not a fit with the company’s environmental objectives. The camp required a no-grid power solution that would reduce both emissions and costs.

 To overhaul the camp’s power usage, the mineral exploration firm worked with clean energy consultant Kelley Dagley to design and build a new power system around two clean sources of energy: solar photovoltaics and propane. The highly automated system is one that could be used by any business operating off the grid. The company installed a 12-kW solar array on the roof of the camp’s fuel depot alongside an 80-kWh battery for power storage. A 15-kW propane generator, designed specifically to work with off-grid renewable energy applications, kicks on to recharge the battery when additional power is needed. Together, the solar inverters and propane generator provide the same peak power capacity as a full-size prime diesel generator.

“Originally we considered a diesel generator, but it was harder to come by one that would work well with a renewable energy system that was also affordable and spec’d to meet EPA Tier 4i emissions regulations,” says Dagley, who is also vice president of the Idaho Clean Energy Association. “The [15-kW propane generator] is specifically designed to do exactly what we’re using them for, which is a backup to solar generation. And it meets all the EPA standards.”

Today, the camp is run completely on solar and propane; solar is also used to power two microwave relays and an air monitoring station. To improve the camp’s energy performance, the mineral exploration firm took a number of steps to reduce its electrical usage. Motion sensors shut off lighting when not in use, and a remote power monitoring system can shut down the power to unnecessary equipment, like engine block heaters on equipment that will not be used for weeks. Also, the poorly performing electric heat pump in the main office trailer was replaced with a propane furnace that performs better in cold weather. In all, the camp was able to reduce its usage to about 30 MWh per year.

Photo courtesy of The Propane Education & Research Council 

A propane generator works in tandem with other renewables to provide clean energy to the remote mining and field operations.

 

Dagley used sophisticated solar modelling and examined diesel prices 20 years into the future to calculate the ROI on the firm’s investment. A $169,000 investment in the solar and propane system yields a 27% tax-free dividend in the first year, growing 7% every year for 25 years. The capital payback is in just over two years, including a 30% tax credit in the first year. The company expects to save about $3 million in diesel costs over the life of the project.

In addition to reducing carbon emissions by eliminating the use of diesel fuel, the company has also reduced the chance of a diesel fuel spill while hauling the fuel alongside the Salmon River and other area streams. “Every fuel truck we keep off the road reduces risk, and we view propane transportation as a safer alternative in the event of a traffic accident,” says Jeff Root, the firm’s Land Manager. “As we go into the permitting process, taking a sustainable approach reflects how we want to run the project now and in the future,” says Bob Barnes, the firm’s COO.

 

Camp Woodstock

Photo courtesy of The Propane Education & Research Council 

Standby generators can bring exceptional value, helping improve guest experiences and protecting revenue.

 

YMCA Camp Woodstock offers kids a getaway from the always-on connections of the everyday world. The summer camp and retreat center in Woodstock Valley, Connecticut, offers kids an opportunity to disconnect from the internet and bond with friends in a positive environment where kids can be kids. The camp’s remote location on a pristine 75-acre lake surrounded by woodlands and farms is an ideal setting to create that environment. For institutions and retreats like Camp Woodstock that consider a remote location to be a selling point rather than a turnoff, propane can play a unique role in offering high-efficiency heating systems and reliable power sources that wouldn’t be available otherwise. That’s particularly vital for non-profit organizations like the YMCA, where lost revenue from a weekend without power or uncomfortable and upset guests can wreak havoc on an operating budget. Losing a week of summer camp to a power outage could result in up to $300,000 in losses – and that’s not even including the loss of income from families who decide not to return. To avoid that scenario, the camp employs eight propane generators, six mobile and two permanently installed, to keep the camp running during an outage. Because the nearby community is so spread out, it’s frequently the lowest on the priority list when power is restored. The generators are critical to maintaining the camp’s lighting, refrigeration, heating, and particularly the pumps for well water. The camp director recalls one Labor Day weekend when the camp was hosting its family camp, one of the most popular and busy weekends of the year, and a hurricane came through and knocked out power for most of the state. They immediately started calling all the families, letting them know, “Hey, we’re going to be operating. We’ve got generators. We’re not going to let this prevent your family from having this weekend.” They had the generators going, the families came out, and they had a great weekend.

 

Resources

Propane Backup Power — Planning Resources Codes & Standards

National Electric Code / NFPA 70 – Articles 700, 701, 702, 708

NFPA 110 – Standard for Emergency and Standby Power Systems

ANSI / IEEE Standard 146 – Emergency and Standby Power Systems

UL 1008 – Automatic Transfer Switches

NFPA 99 – Health Care Facilities

NFPA 101 – Life Safety Code

 

Manufacturer Resources

Cummins – www.cummins.com/generators/commercial-industrial

Generac Power Systems – www.generac.com/all-products/generators/commercial-generators

Kohler Power Systems – kohlerpower.com/en/generators/industrial/products/Gaseous+Generators

Moser Energy Systems – moserengine.com/standby-generators/

Taylor Power Systems – www.taylorpowergenerators.com/category.php?cat=Standby-NG/LP  

 

U.S. EPA Requirements

Generators (gas/propane): https://www.epa.gov/regulations-emissions-vehicles-and-engines/regulations-emissions-heavy-equipment-spark-ignition 

Generators (diesel): https://www.epa.gov/regulations-emissions-vehicles-and-engines/regulations-emissions-heavy-equipment-compression

 

Other Publications

“Build with Propane Guide, Commercial Edition.” Propane Education and Research Council, 2020: propane.com 

“Understanding Backup Power System Fuel Choices.” Authored by Michael Kirchner, Generac. Consulting-Specifying Engineer Magazine, December 2012. 

 

END NOTES

Boutin, Ania Delaney. “Students petition a ‘negligent infrastructure’ following recent power outage.” The Murray State News. February 17, 2025. https://murraystatenews.org/202373/news/students-petition-a-negligent-infrastructure-following-recent-power-outage/. Accessed March 4, 2025.

 Walker, Emily. “How much do power outages cost?” EnergySage. August 22,2024. https://www.energysage.com/energy-storage/how-much-do-power-outages-cost/. Accessed March 4, 2025.

 “S&C Electric Company’s ‘2021 State of Commercial and Industrial Power Reliability Report’ Reveals Companies Reporting Monthly Outages Doubled in the Last Year.” 

S&C Electric Company. March 29, 2021. https://www.sandc.com/en/news/sc-news/sc-electric-companys-2021-state-of-commercial-and-industrial-power-reliability-report-reveals-companies-reporting--monthly-outages-doubled-in-the-last-year/. Accessed March 21, 2025. 

Ibid.

“Businesses assess effects of storm, power outage”, Washington Post, 2012. Power Outage Impact Research.  PERC 2015.

Distributed Generation, National Energy Technology Laboratory. https://netl.doe.gov/sites/default/files/Smartgrid/Value-of-Standby-Generation-08-29-08-AZ--2-_APPROVED_2008_09.pdf. Accessed March 4, 2025.

GREET 2021. https://www.energy.gov/eere/greet.

Carbon Dioxide Emissions Coefficients. U.S. Energy Information Administration. September 7, 2023.  https://www.eia.gov/environment/emissions/co2_vol_mass.php. Accessed July 24, 2024.

Photo courtesy of The Propane Education & Research Council 

Power outages are not only disruptive, but they can also jeopardize critical operations for commercial facilities. Reliable, clean backup power kept on site offers a robust resilience strategy for businesses. 

 

Weather alerts signaling approaching strong storms and damaging winds. The searing heat on a summer day. News of a local wildfire. All of these common occurrences can trigger power blackouts or rolling brownouts that profoundly affect commercial businesses. 

Implications of power outages in commercial buildings include cost impacts, lost productivity, lost sales, loss of product, brand damage, and even life safety risks. On February 17, 2025, students at Murray State University in Kentucky petitioned to hold the school accountable for “negligent infrastructure” after power loss from a lightning strike.1 Dormitories on campus were without heating, light, and hot water for several days.

Integrating a backup power system into a commercial building’s infrastructure offers significant advantages. These systems not only ensure resilience, reliability, and safety, but they can also contribute to environmental conservation and economic efficiency.

 

What is Backup Power? 

To start, it is important to define the general concept of backup power. A basic definition of backup power is an additional power source that can be used in the event of a power failure. When the design professional considers the incredible number of building systems, appliances, office tools, and other equipment that are powered by and reliant on electricity, they get a sense of the impact of a power outage.  According to an EnergySage study in 2024,2 the average financial loss to businesses due to power outages is estimated to be around $150 billion annually in the United States, with the exact cost depending on the business size and duration of the outage. 

General Forms of Backup Power 

Most businesses select backup power technology in the form of a generator, which is essentially an engine that burns fuel to create electricity. Generators are an extremely common backup power technology with a long history. They come in many different sizes and capacities that can burn different fuel sources; in some cases, a generator can even operate on multiple fuels. Each fuel configuration has advantages and disadvantages, but the good news for designers and specifiers is that there is a wide range of options available. 

Another backup power technology is stored power, such as on-site batteries. This type of technology is often used in a “UPS,” or Uninterruptible Power Supply. The role of a UPS is to provide instantaneous backup power until other sources, like a generator, are brought online, or to provide just enough power to allow a system to safely shut down. UPS systems are typically deployed for critical systems in IT, communications, and healthcare, where even momentary loss of power causes serious problems.

Image courtesy of The Propane Education & Research Council

Backup power technology can be divided into generator-based and stored power technologies. 

 

The History of Generator-Based Backup Power 

Generators are used to produce AC current. Generator technology began with the discovery of electromagnetic induction, which paved the way for modern generators and their commercial use. Generator design improved dramatically in the 1890s, with Westinghouse, Siemens, Oerlikon, and GE creating some of the most powerful generators of their time. 

The manufacturer Kohler got its start making small-scale generators for homes in the years immediately following World War I. The company leveraged the emerging demand for electricity on farms and their expertise in cast iron to produce the revolutionary Kohler Automatic Power & Light “power plant” in 1920. This unit furnished an unprecedented 110 volts directly to power lines, turning itself on and off automatically in response to the demand for electricity. 

Having the ability to harness power on demand gave farmers access to not just lights but also running water and electric appliances. Adding these conveniences to daily life was revolutionary for many people. The growth of electrical equipment and appliances has only expanded in modern times, with residential and commercial buildings now completely reliant on such technologies.

 

Codes and Standards for Backup Power 

Photo courtesy of The Propane Education & Research Council 

Numerous standards and testing requirements ensure the efficacy of backup power systems. 

 

There are numerous powerful motivations for commercial buildings to include backup power systems. About 75% of commercial businesses in the United States have backup generators.6

Besides businesses selecting “optional” backup power applications, there are many commercial buildings where building codes and standards dictate that backup power must be used. These codes also govern how the systems are to be designed. 

Image courtesy of The Propane Education & Research Council 

The National Electric Code (NEC) governs backup power systems and adheres to specific terminology. 

 

So far, systems have been loosely grouped using the term “backup power” as a general description of a generator supplying power in case of an outage. However, codes and standards that dictate the use and design of different types of systems use very specific terminology. Different categories of backup power within the code mean very different things.

Relevant Codes: The NEC 

The National Electric Code (NEC) is also known as “NFPA 70” or the National Fire Protection Association’s Standard 70. The NEC addresses the installation of electrical components; signaling and communications systems; and optical fiber systems in commercial, residential, and industrial occupancies.

Within the NEC, there are some key terms relevant to backup power: 

  • An “emergency system” covers systems essential for the safety of human life. These systems are legally required and classified as “emergency” by municipal, state, federal, or by a governmental agency having jurisdiction. These systems generally provide power to egress lighting, fire detection and protection, certain types of elevators, public safety communications, or any system where loss of power would cause serious endangerment to life or health within 10 seconds of normal power loss.
  • “Legally required standby power systems” are backup power required by code depending on building use and occupancy. They may power communications, selected ventilation or smoke removal systems, lighting, or certain types of industrial processes that may create hazards or hamper firefighting operations if power is not available.  These must be available within 60 seconds of normal power loss.
  • “Optional standby systems” are backup power systems that an owner may optionally require if their business practices dictate the necessity. Such systems generally consist of loads that do not affect life safety but could have an unacceptable consequence of financial or operational losses. Loads may include data processing, communication systems, refrigeration, or other imperative performance needs. 
  • “Critical operation power systems” (COPS) are the newest classification of backup power for systems, operations, or facilities designated by local, state, and federal government as “mission critical.” These may include police stations, fire stations, and other facilities that serve public safety, national security, or business continuity. There are also additional commissioning requirements for COPS.

Relevant Codes: IFC and IBC 

The International Fire Code (IFC) and International Building Code (IBC) are two major building codes that dictate specific requirements for commercial buildings.   

The IFC and IBC requirements for emergency and standby power are coordinated with each other. Both of these codes refer back to the NEC for specific installation requirements for electrical systems.

The code requirements for emergency or standby power are based on the building’s use and its occupancy.  Emergency Power Systems are required by the IFC and IBC for high-rise buildings as well as other buildings designated by the jurisdiction.

Standby Power Systems are required by codes for covered mall buildings, high-rise buildings, atriums, and other designated structures.

These are a few of the building uses and occupancies listed in the codes as requiring some form of backup power. Note that IFC and IBC codes can actually require that both Emergency Power and Standby Power systems are installed in certain buildings, such as high rises. In all cases, it is important to thoroughly review the local code requirements to determine which types of backup power are needed.

Code and Emergency Power Categories and Characteristics 

After determining the building use and occupancy to see what types of backup power is required by code, codes may also dictate the specifics of what it takes to provide that power.  

Within Article 700 of the NEC, Emergency Power must have on-site fuel storage and be available within 10 seconds of a power failure, and testing of the system will be required.

The on-site fuel requirement is very important. Because this is an Emergency Power application, on-site fuel storage ensures that the generator is ready to operate and won’t be subject to any upstream fuel reliability issues. In the past, this requirement was typically met by using diesel fuel stored on site. Today, propane stored on-site provides an excellent and environmentally friendly alternative.  

Required acceptance testing is done upon installation, as well as periodic operational testing to maintain the system, should it ever need to be activated. 

Image courtesy of The Propane Education & Research Council 

The physical requirements, per code, for the Emergency Power system. 

 

The loads that need to be supported by emergency power based on the code include:

  • Emergency communication
  • Smoke detectors
  • Fire alarms
  • Standpipes
  • Egress lighting
  • Exit signs

All these loads must be available within the 10-second switchover.

When the code requires a Legally Required Standby Power system, refer to Article 701 in the NEC.  This section of the NEC designates the requirements of the legally required standby power system, which will power systems or components that otherwise may create a hazard or hamper firefighting operations if they are not powered. The power from Legally Required Standby Power systems must be available within 60 seconds of a power failure and require testing of the system.  

While there is not an on-site fuel requirement for Legally Required Standby Power, having this additional design measure adds reliability to the system. As with emergency power, legally required standby power requires that acceptance testing is performed upon installation, as well as periodic operation testing to maintain the system should it ever need to be activated. 

The building systems that are required by code to be on standby power within the 60-second timeframe include:

  • Ventilation systems;
  • Elevators (or conveying systems);
  • Fire command systems; and
  • Access, which may include electronically controlled doors and windows.

Again, these are systems within the building that, if not powered, may create a hazard or may hamper firefighting operations.

“Factory acceptance testing” offers a valuable strategy for some of the required testing, including for legally required standby power, as well as other forms of backup power. Factory acceptance testing takes place at the generator manufacturer’s facility. This is easier to coordinate, as compared to the project site, and also helps in preparation for on-site testing required by the authority having jurisdiction.

Note that many buildings, especially hospitals, will require both Emergency Power (NEC 700) as well as Legally Required Standby Power (NEC 701) and perhaps other loads supported by standby systems. In buildings like this, load prioritization is an impactful part of the system design to ensure that the 700 and 701 loads are satisfied.

Optional Standby Power Systems are governed by Article 702 in the NEC. Optional standby power is less regulated by building codes like IBC and IFC. The design of these systems is driven more by the building owner’s wants and needs, for instance, to keep a data center running or maintain refrigeration. They can also be designed to power any equipment that the owner deems would create a financial, operational, or other significant business loss if it lost power. Optional Standby Power Systems usually cover loads that generally don’t affect life safety or firefighters’ operational needs. Response time and testing of the standby system are specifications set by the owner based on their needs. Fuel for the standby system is also the owner’s choice, but remember that on-site fuel is the most reliable. In some cases, a hybrid system that uses natural gas, not an on-site fuel, along with a fuel stored on-site like propane, provides optimal benefits.

Critical Operations Power Systems, or COPS, are essentially “mission critical” systems that can actually include all three types of the previously mentioned backup power systems, meaning emergency power, legally required standby power, and optional standby power. COPS are regulated by Article 708 in the NEC.

COPS are determined by the local, state, or federal governmen and are generally installed in vital infrastructure facilities that, if destroyed or incapacitated, would disrupt national security, the economy, public health, or safety. They are also installed where enhanced electrical infrastructure for continuity of operation has been deemed necessary by a governmental authority.

The biggest difference for COPS systems is the requirement that the system can operate for 72 hours at full load capacity, with enough fuel stored on-site to meet this requirement. Emergency and/or standby generators can be used as the alternate source of power in COPS. Storing enough fuel on-site for 72 hours of full load run time will dictate the generator’s fuel tank size.  

COPS systems must also be commissioned prior to being put online, with periodic commissioning to occur as well. These requirements are in addition to the previous requirements for each of the other backup power systems.

EPA Emissions Requirements for Generators 

The U.S. Environmental Protection Agency (EPA) also regulates backup power systems. It has set increasingly stringent emissions requirements for non-road engines and equipment. Tier 1 was enacted in 1994, with Tiers 2 and 3 following in the years thereafter. Tier 4 was enacted in 2004, with a number of continuing revisions applied to this day. Overall, this framework has established requirements for increasingly clean exhaust systems.  

A very important note is that different EPA emission requirements (Tiers) will apply based upon the type of backup power system installed. For example, if an Emergency Power system meets the EPA’s definition of an emergency power generator, meaning it only runs for purposes of backup when the grid power goes offline, then the system will have to meet Tier 2 or 3 requirements. These less stringent emission tiers apply because the generator’s run time isn’t too extensive.  

For non-emergency generators, like a system that runs on a regular basis to shave peak loads at a facility to lower utility costs, the generator run time will be much greater, and Tier 4 emissions will apply.  

Therefore, the way in which the EPA regulations categorize a backup power system is significant and can have implications for the equipment specifications. 

For a given project, the details on how emissions requirements will affect system design and specs can be coordinated with the generator manufacturer and the electrical engineer. The EPA also has extensive information on the emissions tiers available online.

 

Fuel Options and Environmental Concerns When Providing Emergency and Standby Power 

Traditionally, diesel has been the choice in most backup power applications, but today, there are additional fuel options for designers and specifiers, each with inherent benefits. Stakeholders can now help to optimize their backup power system’s performance and costs through their fuel selection. 

Diesel

Diesel remains the most common fuel choice for commercial buildings, yet it presents dependability challenges. Diesel is cost-effective for larger, single-engine applications over 150 kW. It also provides a good option for on-site fuel storage, a system feature that is required in Emergency Power applications. Diesel generators are also able to match their power output as they face variable loads.

Perhaps the most significant challenge for diesel systems is the stability of the diesel fuel. Diesel degrades over time via oxidation, which leads to the formation of sediments and gum that can clog fuel filters and injectors if not treated. Condensation in the fuel system can also lead to bacteria growth, which can cause clogging. Thus, diesel storage systems require either manual regimens or automatic fuel maintenance systems to keep the system reliable. In fact, for emergency applications, fuel maintenance is required by code within NFPA 110. The need for either automatic fuel maintenance systems or manual operations increases the total ownership cost of the diesel system, a factor to include in the evaluation of fuel and equipment options. 

Diesel generators are covered by EPA emission regulations. As described in the previous sections, it’s especially important to understand which regulations apply based on the exact backup power application. The implications of which regulations apply can have a significant impact on costs. 

Natural Gas 

Natural gas-powered systems previously had durability issues as well as concerns about the fuel’s power density.  However, recent innovations have greatly improved the performance and power of natural gas generators. Examples include engine speed optimization, optimized air/fuel mixtures, and improved transient performance. Natural gas is growing in popularity, with 28% of commercial generator systems running on natural gas.

Key benefits of natural gas generators include good cost-effectiveness for smaller, single-engine applications. For larger applications, paralleling generators can satisfy loads over 150 kW, and because the fuel source is utility-supplied and not stored on-site, long run times are possible without re-fueling concerns. The environmental profile of a natural gas generator is favorable, with lower NOx and particulate matter emissions compared to a similar capacity diesel system. Fuel stability is also not an issue as it is for diesel.

Challenges for natural gas generators include the technology’s cost effectiveness for large single engine applications. Interestingly, the most significant challenges are related to some of natural gas’s benefits. The fuel is supplied by a utility and not stored on-site. This provides some advantages, but it also means there’s no on-site storage when this is a system requirement. While natural gas utilities are typically very reliable, the delivery infrastructure is not always 100% reliable, particularly during natural disasters. Outages could occur, or some buildings could be subject to curtailment based on the utility’s operating policies. Also, in seismic regions, natural gas distribution will be shut down during a seismic event, cutting off supply.  

These reliability issues can be evaluated by the project team to better understand their likelihood and significance. Hybrid natural gas/propane systems are an effective option that can be used to alleviate the gas supply reliability issues. 

Propane 

Propane, often called “LP,” is another fuel choice option. Propane offers many of the same benefits as natural gas, including its cost-effectiveness for smaller single-engine applications. Unlike natural gas, propane is stored on site. This characteristic makes it an alternative to diesel when on-site fuel storage is either required or desired. Propane can also serve many other applications in the building. Any type of system or appliance that could be served by natural gas readily accepts propane as a fuel. Some of the most common propane applications in commercial buildings include water heating, space heating, clothes dryers, and fireplaces, which are all applications where propane offers distinct cost and environmental advantages over electric options.

In terms of fuel stability, propane does not degrade or oxidize over time like diesel. These factors mean there are no fuel maintenance issues with propane, which can be a major cost and operational benefit in backup power systems that either require or prefer on-site fuel storage.

Propane’s environmental profile is also favorable compared to diesel, with lower NOx, particulate matter, and CO2 emissions. These benefits are likely to become more significant over time as emissions standards continue to grow more stringent.

In terms of fuel cost, propane production has grown significantly. This ample supply means that propane is competitively priced with diesel fuel in the engine fuels market.  Challenges with propane generator systems include lower cost effectiveness for large, single-engine applications. Design options for propane systems include running the system with the propane entering the engine as either a vapor or a liquid. Vapor configurations offer some advantages and need to account for the vaporization rate of the propane from a liquid into a gaseous form, based on several variables. Generator manufacturers offer design support to account for these factors in the system design.

Propane tanks can provide on-site propane storage for backup power systems of any size. Determining the minimum required on-site storage involves looking at the generator’s fuel consumption rate and its specified run time to arrive at how many gallons of storage are needed. For example, a 60-kilowatt generator that serves a medium-sized commercial building, running at full load, will consume about 9 gallons of propane per hour and 215 gallons over an entire day. Keep in mind that it’s unlikely a generator will run at full load for an extended period, which will decrease the consumption rate. Because of its efficiency, storing enough propane on-site for backup power is readily accomplished. Propane storage tank sizes range from 125-gallon tanks for spot energy needs all the way up to 120,000-gallon storage tanks. One tank can be sized to serve all of a building’s gas energy needs based on its total maximum load, or multiple smaller tanks can be manifolded together. For the 60 kW generator in the example, a stan1000-gallonallon tank would likely be suitable.

NFPA Standard 58 establishes the industry requirements for tank and underground gas line installation. Working in accordance with NFPA 58, the propane supplier involved in the project can determine the proper size and number of tanks to meet the building’s loads. Tanks can be fenced, buried, or landscaped to enhance security, safety, and aesthetics.

Image courtesy of The Propane Education & Research Council 

Propane tanks can provide on-site propane storage for backup power systems of any size. NFPA Standard 58 establishes industry requirements for propane tanks. 

 

Multi-Source 

Multi-source backup power systems offer another option where the system utilizes multiple fuels to optimize costs, performance, and code compliance.

A dual fuel system will typically utilize natural gas fuel for the generator’s operation. The dual fuel system is also designed for propane supply and combustion and is fed by on-site propane. If the natural gas supply is cut off for any reason, the system switches over to propane. This type of design takes advantage of the utility-supplied advantages of natural gas, as well as the on-site security and storage benefits of propane, compared to diesel.

Bi-fuel designs are used in larger applications. In these systems, diesel and natural gas are combusted simultaneously. The diesel leads off the operation, and then the system gradually integrates natural gas, 

which is actually ignited by the diesel. The system’s controls optimize the proportion of the two fuels to roughly a 3:1 proportion between natural gas and diesel. While these systems come at a cost premium, this fuel mix optimizes the use of both natural gas and diesel.

Conclusion 

With the nation’s electrical grid under frequent assault by increasingly intense storms, many businesses are turning to backup generators for an uninterrupted power supply. This is especially true in vulnerable coastal areas and inland tornado alleys.

Put simply, there are cleaner alternatives to traditional diesel-powered generators. Backup power that uses propane or dual fuel captures many sustainable benefits. Propane standby generators offer a powerful, reliable way to protect buildings and businesses from the damage a power outage can cause.  Propane is a low-carbon energy source that produces fewer harmful emissions than competing fuels. According to the US Office of Energy Efficiency and Renewable Energy (EERE), 52% fewer greenhouse gas emissions are released when using propane, as compared to an equivalent amount of electricity generated from the U.S. grid.7 In comparison to other widely used fuels, the US Energy Information Administration (EIA) shows that propane offers one of the lowest carbon emissions per million BTUs.8 Generators that operate on propane have proven to be environmentally friendly relative to diesel. Tailpipe emissions from propane generators are significantly lower in two air-pollution categories: NOx and PM. Choosing propane secures forward-thinking environmental benefits, including reduced greenhouse gas and NOx emissions, as well as lowered energy costs and more efficient performance. Since propane is designed to be safely delivered and stored on site, it offers energy security. The security, efficiency, and environmental profile of propane provides it with unique advantages as a backup fuel source.

 

Why Do Commercial Buildings Use Backup Power? 

Photo courtesy of The Propane Education & Research Council 

Power outages from storms and other causes are on the rise. Backup power allows businesses to avoid losses and keep operating safely. 

 

There are many reasons a commercial building may select backup power: code requirements,  redundancy, enhanced energy or cost savings, energy independence, decentralized supply, environmental benefits, or simply to ensure uninterrupted power supply. The first decision point for owners and projects is related to optional backup power applications, often used in buildings where there is not a code or jurisdictional requirement mandating that a building use backup power. Even without this requirement, there may be other very good reasons for owners and occupants to consider the use of a backup system.  

Buildings provide a wide range of functions. When these functions are interrupted by power outages, an extensive set of negative outcomes result. Outages cause widespread financial impacts. 

A 2021 report from S&C Electric Company3 covered a survey of facilities and energy managers of commercial and industrial (C&I) businesses across the United States. Survey data revealed “a dramatic increase in companies reporting short-duration outages as their most common power outage. Companies affected by momentary outages lasting less than five minutes jumped from 20 percent to 40 percent in one year, signifying that outages are becoming more prevalent and noticeable because of their impact on operations. The report also uncovered that 44 percent of companies lost power monthly or more frequently—double the percentage from  2020—indicating companies are seeing more negative impacts that could jeopardize critical operations and potentially risk their reputations as reliable goods-and-services providers. Survey data showed a typical outage cost $100,000 or more for nearly one-quarter (22 percent) of companies. Most (80 percent) of these C&I companies experienced monthly outages, resulting in an annual loss of $1.2 million. 

Of the various industry segments, the education sector experiences the most in terms of outage frequency, with 7% of that sector encountering an outage once a week. More than a quarter of the manufacturing industry deals with an outage at least once a month. In this same research, respondents said that power outages can have a significant impact on the reputation of their business. The types of impacts will vary by both building type and industry. For example, a luxury hotel or restaurant is very sensitive to a damaged reputation. For the healthcare industry, 58% of respondents shared that outages resulted in losing customers and affecting their patients’ satisfaction. For small franchises, the aftermath of outages for 62% of these customers meant lost sales and cancelled orders.4

Power outages can result in major financial losses for food providers. For example, a storm in Washington State created widespread power outages that lasted for several days. A small Ben & Jerry’s establishment received their usual shipment of fresh ice cream, only to suffer a three-day power outage shortly after. By the end of the multiday power outage, the store had lost about half of its ice cream, as employees were only able to protect half with dry ice, leading to an estimated $60,000 in losses.5 

A two-hour power outage at a New Mexico Intel manufacturing facility, caused by a 500-acre brush fire near a power generation station, resulted in a half a week of lost production. Facility equipment was damaged, and an additional 24-hour delay was then experienced waiting for repair parts.

Power outages and their impacts are well documented. At the same time, the building industry has increasingly pursued more resilient designs and systems to help clients withstand outages and perform through other challenges, such as natural disasters.

As a growing element of resilient design, installing permanent backup generators is one common building resilience strategy. The use of permanently installed backup power generators is also increasing significantly. 

 

Stibnite Gold Project

 

Photo courtesy of The Propane Education & Research Council 

While EPA regulations for generators are not usually at the forefront of a design professional’s mind, they can immensely impact the design of a project. 

 

Despite nearly a century of mining activity, the Stibnite Gold Project in central Idaho contains valuable deposits of gold and other minerals, such as antimony. A mineral exploration firm set up a camp on the site, which it has been studying since 2009 with the goal of opening a world-class mine. The camp includes a core shed, a maintenance shop, a fuel depot, several office trailers, and a handful of year-round staff members.

The exploration camp is remote, even by Idaho standards. It is located 100 miles northeast of Boise, along the boundaries of the Frank Church Wilderness, and the nearest electrical grid power is 15 miles away, in the 60-person town of Yellow Pine.

The mineral exploration firm plans to connect to the grid when all the permits are secured. In the meantime, the camp must use onsite power generation. Initially, that meant using large, fuel-hungry diesel generators to power the camp’s lighting, computers, engine block heaters, and other essential equipment. In addition to being expensive, the malodorous, inefficient diesel units were not a fit with the company’s environmental objectives. The camp required a no-grid power solution that would reduce both emissions and costs.

 To overhaul the camp’s power usage, the mineral exploration firm worked with clean energy consultant Kelley Dagley to design and build a new power system around two clean sources of energy: solar photovoltaics and propane. The highly automated system is one that could be used by any business operating off the grid. The company installed a 12-kW solar array on the roof of the camp’s fuel depot alongside an 80-kWh battery for power storage. A 15-kW propane generator, designed specifically to work with off-grid renewable energy applications, kicks on to recharge the battery when additional power is needed. Together, the solar inverters and propane generator provide the same peak power capacity as a full-size prime diesel generator.

“Originally we considered a diesel generator, but it was harder to come by one that would work well with a renewable energy system that was also affordable and spec’d to meet EPA Tier 4i emissions regulations,” says Dagley, who is also vice president of the Idaho Clean Energy Association. “The [15-kW propane generator] is specifically designed to do exactly what we’re using them for, which is a backup to solar generation. And it meets all the EPA standards.”

Today, the camp is run completely on solar and propane; solar is also used to power two microwave relays and an air monitoring station. To improve the camp’s energy performance, the mineral exploration firm took a number of steps to reduce its electrical usage. Motion sensors shut off lighting when not in use, and a remote power monitoring system can shut down the power to unnecessary equipment, like engine block heaters on equipment that will not be used for weeks. Also, the poorly performing electric heat pump in the main office trailer was replaced with a propane furnace that performs better in cold weather. In all, the camp was able to reduce its usage to about 30 MWh per year.

Photo courtesy of The Propane Education & Research Council 

A propane generator works in tandem with other renewables to provide clean energy to the remote mining and field operations.

 

Dagley used sophisticated solar modelling and examined diesel prices 20 years into the future to calculate the ROI on the firm’s investment. A $169,000 investment in the solar and propane system yields a 27% tax-free dividend in the first year, growing 7% every year for 25 years. The capital payback is in just over two years, including a 30% tax credit in the first year. The company expects to save about $3 million in diesel costs over the life of the project.

In addition to reducing carbon emissions by eliminating the use of diesel fuel, the company has also reduced the chance of a diesel fuel spill while hauling the fuel alongside the Salmon River and other area streams. “Every fuel truck we keep off the road reduces risk, and we view propane transportation as a safer alternative in the event of a traffic accident,” says Jeff Root, the firm’s Land Manager. “As we go into the permitting process, taking a sustainable approach reflects how we want to run the project now and in the future,” says Bob Barnes, the firm’s COO.

 

Camp Woodstock

Photo courtesy of The Propane Education & Research Council 

Standby generators can bring exceptional value, helping improve guest experiences and protecting revenue.

 

YMCA Camp Woodstock offers kids a getaway from the always-on connections of the everyday world. The summer camp and retreat center in Woodstock Valley, Connecticut, offers kids an opportunity to disconnect from the internet and bond with friends in a positive environment where kids can be kids. The camp’s remote location on a pristine 75-acre lake surrounded by woodlands and farms is an ideal setting to create that environment. For institutions and retreats like Camp Woodstock that consider a remote location to be a selling point rather than a turnoff, propane can play a unique role in offering high-efficiency heating systems and reliable power sources that wouldn’t be available otherwise. That’s particularly vital for non-profit organizations like the YMCA, where lost revenue from a weekend without power or uncomfortable and upset guests can wreak havoc on an operating budget. Losing a week of summer camp to a power outage could result in up to $300,000 in losses – and that’s not even including the loss of income from families who decide not to return. To avoid that scenario, the camp employs eight propane generators, six mobile and two permanently installed, to keep the camp running during an outage. Because the nearby community is so spread out, it’s frequently the lowest on the priority list when power is restored. The generators are critical to maintaining the camp’s lighting, refrigeration, heating, and particularly the pumps for well water. The camp director recalls one Labor Day weekend when the camp was hosting its family camp, one of the most popular and busy weekends of the year, and a hurricane came through and knocked out power for most of the state. They immediately started calling all the families, letting them know, “Hey, we’re going to be operating. We’ve got generators. We’re not going to let this prevent your family from having this weekend.” They had the generators going, the families came out, and they had a great weekend.

 

Resources

Propane Backup Power — Planning Resources Codes & Standards

National Electric Code / NFPA 70 – Articles 700, 701, 702, 708

NFPA 110 – Standard for Emergency and Standby Power Systems

ANSI / IEEE Standard 146 – Emergency and Standby Power Systems

UL 1008 – Automatic Transfer Switches

NFPA 99 – Health Care Facilities

NFPA 101 – Life Safety Code

 

Manufacturer Resources

Cummins – www.cummins.com/generators/commercial-industrial

Generac Power Systems – www.generac.com/all-products/generators/commercial-generators

Kohler Power Systems – kohlerpower.com/en/generators/industrial/products/Gaseous+Generators

Moser Energy Systems – moserengine.com/standby-generators/

Taylor Power Systems – www.taylorpowergenerators.com/category.php?cat=Standby-NG/LP  

 

U.S. EPA Requirements

Generators (gas/propane): https://www.epa.gov/regulations-emissions-vehicles-and-engines/regulations-emissions-heavy-equipment-spark-ignition 

Generators (diesel): https://www.epa.gov/regulations-emissions-vehicles-and-engines/regulations-emissions-heavy-equipment-compression

 

Other Publications

“Build with Propane Guide, Commercial Edition.” Propane Education and Research Council, 2020: propane.com 

“Understanding Backup Power System Fuel Choices.” Authored by Michael Kirchner, Generac. Consulting-Specifying Engineer Magazine, December 2012. 

 

END NOTES

Boutin, Ania Delaney. “Students petition a ‘negligent infrastructure’ following recent power outage.” The Murray State News. February 17, 2025. https://murraystatenews.org/202373/news/students-petition-a-negligent-infrastructure-following-recent-power-outage/. Accessed March 4, 2025.

 Walker, Emily. “How much do power outages cost?” EnergySage. August 22,2024. https://www.energysage.com/energy-storage/how-much-do-power-outages-cost/. Accessed March 4, 2025.

 “S&C Electric Company’s ‘2021 State of Commercial and Industrial Power Reliability Report’ Reveals Companies Reporting Monthly Outages Doubled in the Last Year.” 

S&C Electric Company. March 29, 2021. https://www.sandc.com/en/news/sc-news/sc-electric-companys-2021-state-of-commercial-and-industrial-power-reliability-report-reveals-companies-reporting--monthly-outages-doubled-in-the-last-year/. Accessed March 21, 2025. 

Ibid.

“Businesses assess effects of storm, power outage”, Washington Post, 2012. Power Outage Impact Research.  PERC 2015.

Distributed Generation, National Energy Technology Laboratory. https://netl.doe.gov/sites/default/files/Smartgrid/Value-of-Standby-Generation-08-29-08-AZ--2-_APPROVED_2008_09.pdf. Accessed March 4, 2025.

GREET 2021. https://www.energy.gov/eere/greet.

Carbon Dioxide Emissions Coefficients. U.S. Energy Information Administration. September 7, 2023.  https://www.eia.gov/environment/emissions/co2_vol_mass.php. Accessed July 24, 2024.

Originally published in Architectural Record

Originally published in May 2025

LEARNING OBJECTIVES
  1. Explain what it means for a commercial building to integrate backup power and explore common and alternative technology options used.
  2. Review the impacts of power outages and the frequency of outages and explain both the safety and sustainability-based motivations driving commercial businesses to utilize backup power.
  3. Describe relevant codes and standards that address the need for, and design of, backup power systems in commercial buildings.
  4. Identify the environmental and resiliency benefits and disadvantages of different fuel sources for backup power.

1 AIA LU/HSW

1 GBCI CE Hour

0.1 ICC CEU

1 AIBD P-CE
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