Ready for Pea Demand

Get Ready for Peak Demand

Are you looking for ways to reduce your organization’s operating costs? As the long, hot days of summer approach, there is one particular hour on one specific day that deserves your attention. That hour is known as peak demand, and your energy consumption during that hour substantially impacts your organization’s energy expenses.

What Is Peak Demand? 

Peak demand refers to that solitary hour in the year when electricity usage across New England is at its highest. Your energy usage during peak demand determines your ICAP tag. This tag carries significant implications for your electricity bills in the long run because a portion of your electric rate is tied to it. A big challenge, however, is that it is difficult to predict when peak demand will actually occur. 

Why Does Peak Demand Exist? 

ISO New England is responsible for maintaining the reliable operation of New England’s power grid no matter how much electricity is being sought from the grid at any particular time. Maintaining this capacity is costly, and these costs are passed on to customers as a portion of your supply rate from your third-party supplier. When you get quotes for electric supply from a third party supplier, one metric they integrate into your pricing is how much electricity you used during the peak demand hour of the previous year. If you are using the utility for your supply, they blend your peak hour usage with all their other customers in calculating your rate, so your usage has less of an effect.

Peak Demand Management

Most likely, peak demand will occur on an upcoming hot summer afternoon. You can get ready for it with some of the following strategies: 

  • Pre-cool your building on days when the peak is likely, and then turn up the thermostats during the predicted peak hour.
  • Turn off unnecessary electricity usage during potential peak hours, like lights, A/C for unoccupied spaces, power strips, fans, computers.
  • Don’t charge EVs during the peak time.
  • Add renewable energy sources like solar power and energy storage onsite. Solar-plus-storage reduces your reliance on grid-supplied power and allows you to store power generated by your solar system, which you can use during peak hours. Discharging a large battery during the peak hour can have a more significant impact on your demand than reducing your usage and does not affect your operations.
  • Enroll in a demand response program if you can reduce your electricity load to receive additional financial incentives during peak events.

Taking Control of Your Energy Costs

Understanding and managing peak demand can significantly impact your energy costs. As a leading provider of solar and energy storage solutions, Solect Energy is ready to help. Reach out to us today to start a conversation about implementing solar and energy storage as a strategy to manage energy costs.

Find out how much you can save or earn by going solar.