In the last few years, commercial battery storage technology has advanced rapidly making solar battery storage a practical option for many organizations.
This video explains how to lower electricity costs using battery storage to reduce utility demand charges. Renewable energy like Sunpower solar panels and commercial battery storage solution might make sense for your organization.
Demand Charges Explained:
Knowing how your electric use is billed and how your demand and energy charges are calculated will help you understand and manage your total energy costs.
Understanding the energy charge Energy charge is the calculation of the amount of electricity kilowatt-hours (kWh) consumed during the billing period.
Each of the ten light bulbs above uses 100 watts of electricity. If all ten are lit for one hour, they will have consumed one kWh of electricity: 10 light bulbs x 100 watts x one hour = 1,000 watt-hours (1 kWh) Your meter records the amount of energy used on-peak and off-peak.
Understanding the demand charge
Demand is the rate at which you consume electricity – or the amount needed to power your business at any given point in time. Your demand charges are based on the highest level of electricity supplied at one time during the billing period and at the time of day it’s needed by your business. A single light bulb demands 100 watts of electricity at any given moment. In the energy charge example, the ten light bulbs demanded 1,000 watts (1 kW) of electricity to operate.
Understanding the energy charges on your bill
Your bill will indicate how much energy was used on-peak, we will use the time frame between 9 a.m. and 9 p.m. Monday – Friday, as peak in our example. We’ll use the hours between 9 p.m. and 9 a.m. Monday – Friday, weekends and designated holidays as off-peak. Most all utilities designate weekends and holidays as off peak.
Understanding the demand charges on your bill
You will see demand charges appear as two separate charges on your bill. The first is the On-peak demand charge, this charge is applicable to your peak time frame in addition to your peak rates. You will also see Off-peak demand charges and Off peak rates as well. Most utilities use a 15-minute interval as a period of time to measure your highest level of demand usage. This is when you use the most electric power to run your equipment, lights, etc. During the on-peak time period, in our example, 9 a.m. to 9 p.m. weekdays you get charged an incrementally higher rate. This charge applies only to the rate or volume of electricity your purchase during the peak time frame.
The purpose of your solar electricity and battery system is to discharge your battery during your peak load time frame. This will allow you to eliminate or significantly reduce your demand fees and lower your electricity bill.
Call today at 480-636-0321 to learn how Sunpower solar systems and battery backup can save your business money on your electricity bill.