Implementing peak shaving can lead to significant cost savings for small businesses, primarily through reducing demand charges and mitigating the impact of high electricity prices during peak hours. Here’s a breakdown of how peak shaving can benefit small businesses financially:
Primary Cost Savings Mechanisms
- Reduced Demand Charges:
- Demand charges are typically applied to commercial and industrial customers based on their highest power consumption during specific intervals (often 15 minutes) within a billing cycle.
- By using battery energy storage systems (BESS) or other on-site power generation sources, businesses can reduce these peak demands, thus lowering their demand charges significantly.
- Avoidance of High Peak Hour Prices:
- Electricity prices often surge during peak demand hours, making it more expensive for businesses to operate.
- Storing energy during off-peak hours and using it during peak hours can help businesses avoid these high costs.
- Integration with Renewable Energy:
- While not required for peak shaving, integrating solar panels or other renewable energy sources with energy storage can further reduce costs by allowing businesses to use stored renewable energy during peak periods.
Additional Benefits
- Enhanced Energy Resilience: Peak shaving can provide emergency backup power during outages, ensuring business continuity.
- Support for Sustainability Goals: By minimizing reliance on the grid, especially during peak periods, businesses can reduce their carbon footprint.
Considerations for Small Businesses
- Initial Investment: Implementing peak shaving typically requires an initial investment in energy storage systems and other infrastructure.
- Energy Monitoring and Planning: Effective peak shaving involves real-time monitoring of energy usage and demand forecasting to optimize energy storage and discharge.
- Sustainability and Resilience Improvements: Beyond cost savings, peak shaving supports environmental sustainability and operational resilience.
In summary, small businesses can see substantial financial benefits from peak shaving by lowering demand charges and avoiding high peak-hour electricity prices. While the extent of savings depends on factors like local electricity pricing and the specific demand charges faced by the business, integrating peak shaving into energy management strategies can be a valuable cost-saving measure.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/what-are-the-potential-cost-savings-for-small-businesses-implementing-peak-shaving/
