Peak shaving with battery energy storage systems (BESS) reduces electricity costs primarily by mitigating demand charges that commercial and industrial customers face. Here’s how it works:
How Peak Shaving Reduces Electricity Costs
- Understanding Demand Charges:
- Demand charges are based on the highest power consumption rate during a specific interval, typically 15 minutes, within a billing period.
- High demand charges significantly increase utility bills.
- Role of Battery Energy Storage Systems (BESS):
- Energy Storage During Off-Peak Hours: BESS stores energy when electricity demand is low, typically during nighttime or early morning when rates are lower.
- Discharge During Peak Hours: This stored energy is discharged during peak demand periods, reducing the need for electricity from the grid.
- Key Benefits:
- Cost Savings: By using stored energy, businesses avoid drawing power from the grid at peak hours when electricity prices are higher, leading to substantial cost savings on demand charges.
- Grid Stability: BESS help stabilize the grid by reducing peak demand, which can prevent strain and potential outages, benefiting both consumers and grid operators.
- Integration with Renewable Energy:
- Peak shaving can be more effective when combined with renewable sources like solar or wind power. Excess energy generated from these sources during off-peak times can be stored in BESS for use during peak periods, maximizing energy efficiency and savings.
- Optimization Techniques:
- Advanced control methods and algorithms are used to optimize peak shaving. These methods analyze historical load data to determine the optimal shave level, ensuring that energy storage is utilized efficiently to reduce peak demand without depleting the battery too quickly.
Overall, peak shaving with BESS is a strategic approach that offers significant cost savings by reducing reliance on grid power during peak periods while enhancing grid stability and promoting renewable energy integration.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-does-peak-shaving-with-battery-energy-storage-systems-reduce-electricity-costs/
