What Is Coincident Peak Demand And Are The Power Savings Worthy Of Facility Shutdown?

With power prices spiralling, Commercial & Industrial (C&I) enterprises are doing all they can to save on future power costs, including coincident peak demand and facility shutdown strategies. In short, coincident peak is defined as your facility’s demand during the period in which systemwide electricity demand is at its highest. In other words, coincident peak demand measures how each commercial or industrial facility, or groups of them, contribute to the overall peak demand of a particular electricity system.

IESO GLOBAL ADJUSTMENT AND HOW ONTARIO BUSINESSES HAVE BEEN TRYING TO SAVE

Here in Ontario, every energy user pays a Global Adjustment (“GA”) fee. This covers the cost of new electricity infrastructure, existing resource maintenance, and demand management programs. This is added to the Hourly Ontario Energy Price (“HOEP”) to make up a C&I company’s overall power cost.

Over the years, C&I businesses in Ontario have been presented a unique opportunity. This is the opportunity to reduce their load during the province’s Coincident Peak (“CP”). This reduces the province peak, and correspondingly can reduce their future IESO Global Adjustment costs as well. C&I businesses in Ontario can only participate in this opportunity should they be classified as Class A customers. These are companies that by and large use 500KW of power or more.

Traditionally, load management and so-called Coincident Peak chasing has been the tried-and-tested method of realizing power savings. However, this method is rather outdated and now generates lesser savings, as we’ll explain next.

COINCIDENT PEAK CHASING AND SUBSEQUENT FACILITY SHUTDOWN IS OUTDATED

It’s been common practice for Class A C&I customers in Ontario to employ load management techniques to reduce their load during Coincident Peaks. In other words, shutting down their facility and switching off non-critical equipment or processes during pre-determined windows of time.

Ontario C&I businesses did get some temporary relief from Coincident Peak chasing, however. This was during the Industrial Conservation Initiative (ICI) peak hiatus for ICI participants. Lasting from July 2020 to July 2021, the peak hiatus helped ease a sustained post-pandemic recession. It did result in the first ever Emergency Demand Response (DR) call being enacted though.

At the end of 2020, another change occurred. The Government of Ontario took 85% of the costs related to wind, solar and biomass projects from the GA and decided to pay for them through the provincial tax base. These costs were taken out of the GA and thereby lowered the value of GA by 25%. This lowered the energy bills for most Ontario C&I customers and it also made the value of curtailing less valuable. Ultimately, this has left businesses searching for a more holistic approach to energy bill management.

HOW DO COINCIDENT PEAK DEMAND STRATEGIES WORK?

For those businesses still looking to curtail, Coincident Peak demand strategies have seen C&I facilities receive notifications on a day-ahead or day-of basis. Notifications have informed them that a Coincident Peak is set to occur. During the last decade, Coincident Peak notifications have been released on weekday afternoons over a 4 to 6-hour period. Furthermore, there have also been around 25 notifications informing C&I facilities about high likelihood days for them to chase in order to hit the Coincident Peaks.

To succeed with load management, C&I businesses have needed a solid strategy in place. A strategy to switch off non-critical equipment or processes before turning them back on again.

Ultimately, this traditional form of load management has seen C&I businesses experience around 10 to 12 hours of power outages when chasing the peaks. Where facilities have chased Coincident Peaks for 15 to 25 days, outages have lasted between 150 to 500 hours. The question to ask yourself is, is facility shutdown, power outages, worker downtime and lost production really worth it?

THE FUTURE IS HERE! OUR UNINTERRUPTIBLE POWER SUPPLY PROVIDES YOU STRESS-FREE SAVINGS INSTEAD

Rest assured, Demand Power can save your C&I business the upheaval and interruptions associated with traditional Coincident Peak demand strategies. Instead, you can contact our team to construct an Uninterruptible Power Supply (“UPS”) with an extended battery at your commercial or industrial facility. The best part of all is that Demand Power provides our industrial UPS systems as a ZERO cost service to our clients.

Demand Power will take on your HOEP and IESO Global Adjustment costs, bundling them together so you can save. In its place, you’ll be charged a fixed cost of power for the duration of our agreement, protecting you from power price increases and providing you peace of mind.

Furthermore, our Uninterruptible Power Supply and extended battery system provides you with improved power quality, power reliability, and helps increase the lifespan of sensitive industrial equipment and machinery too. To sum up, if we do not hit the Coincident Peaks, you’ll still get the savings.  

Interested? The Demand Power team can’t wait to hear from you. Call 1-855-336-2638 or email info@demandpower.ca today and receive immediate value on day one in comparison to current shared savings models.

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