Master the Fundamentals: Demand Response and Demand Management

Master the Fundamentals: Demand Response and Demand Management

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Beat the peak (and save $) with demand management.

On the flip side, to keep the grid in its general steady state of balance, utilities charge you for how much strain your individual facility puts on the grid when you’ve got all systems running full tilt. These “peak demand charges” can be passed through in deregulated markets, accounting for up to 30% of your total bill, or in regulated markets, can tip the scales and bump you into that next rate class and cost you thousands.

 

1. Understand how you’re billed.

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Are peak demand charges passed through or are you going to pay a flat rate no matter what? Are you on the cusp of a specific rate class? Would one 15-minute interval bump you to that next level and cost you thousands? Priority #1 in managing peak demand starts with understanding not just how much you use at peak, but how much you’re charged for using it (I talked about this in the earlier cost driver post about how you buy energy). Lots of energy dashboards will show you when you set your peak demand, but Enel X’s energy intelligence software platform connects energy consumption with a robust tariff engine so that you’re making decisions based on the financial impact – and lets you decide whether to shift production schedules, turn off non-essential equipment, or take a less energy intensive approach until the critical period passes

For example, your tariff might mean that you enter a peak window starting at 7am and ending at 2pm Monday through Friday. Armed with this information, you can choose to run particularly energy intensive equipment outside of that window, ensure a building is pre-warmed or cooled to a certain temperature by 7am, or otherwise shift energy use outside of those costly 7am-2pm hours. Adjusting when you use energy in response to your specific utility tariff will not only decrease your monthly bills, but will also improve your budget certainty.

2. Be proactive about your peaks.

If you’re waiting for your utility bill to tell you that you have set a new peak demand, then you’re already behind the eight-ball. With real-time energy monitoring, you can set an alert to give you advance warning if you’re about to set a new peak so you can take the necessary steps to avoid it.

3. Be prepared with a mitigation strategy.

Get Notified, Respond, Get Support

If you get the alert, you have to have a strategy in place to safely and effectively dial back. Lots of Enel X customers simply deploy the energy curtailment plan we’ve designed for them as part of their participation in demand response.

Managing your energy line item isn’t easy, but the goal of energy intelligence software is simple: to provide stakeholders throughout an organization – whether energy manager, chief engineer, or CFO — the visibility they need to understand what drives overall energy spend, the information they need to prioritize investments in improvements, and the data to validate that their investments are delivering the value they expected.

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