Why Might Power Companies Charge Extra During Peak Load Times?
Throughout the day the demand for power rises and falls. Usually, demand will peak during the afternoon hours and it will hit its minimum in the early morning hours. In order to account for this changing demand, there are two types of power plants that provide power to the grid. One is a called base load and the other is peak load. Base load power plants provide the consistent minimum amount of power that is demanded day and night every day. Peak load generators provide the power for the daily afternoon demand spikes.
Right now, coal and nuclear are the cheapest and most reliable power plants. However, they can only achieve their highest efficiency when they are running at their designed capacity. It takes days to fully scale up or down energy production with these power plants. Therefore, they are not responsive enough to meet the daily spikes of energy usage that are encountered in the real world. Instead, they provide the base load.
Peak load generators need to be able to come online quickly when demand spikes and then shut off just as quickly when demand goes back down. The majority of peak load is provided by natural gas turbines. They can be started and stopped frequently without sacrificing much efficiency. The problem is, even at peak efficiency, they are considerably more expensive to run than the base load power plants. Therefore, power companies charge more during peak load times because generating peak load power is simply more expensive.
When Do The Highest Peak Loads Occur?
More energy is used during the heating season than the cooling season. But, most of that energy is consumed in the form of heating fuels and not electricity. However, the vast majority of cooling is provided by electricity. Therefore, late afternoon during the summer cooling season is when the highest peaks of electricity usage occur.
What Is Demand Response?
One tool power providers have in their grid management arsenal is called demand response. Electric companies offer customers financial incentives to use less during peak load times. They may charge more for electricity used during that time to discourage use. Or they may offer overall reduced rates to customers that pledge to use less during those times.
How Can A Smart Home Help?
During a demand response event, smart thermostats can receive a signal to automatically adjust temperature set points to lower your home’s energy usage. You will use less of the expensive energy and the power company will have less worry about being able to meet the total demand. It’s a win-win.
Major smart thermostat makers such as Nest, Honeywell, and Ecobee already have deals with power companies to facilitate demand response initiatives for their customers. Schneider Electric’s Wiser Air smart thermostat can even communicate directly with smart meters.
The Rest Of The Smart Home
Other smart home devices may be integrated with demand response programs, too. Although the following features are not currently commercially available, I see these types of features coming to the smart home in the near future.
Smart Vents – This is a smart home system that is just starting to gain some traction. The potential for energy savings is greater than even smart thermostats. Essentially smart vents turn your single zone HVAC system into a multi-zone HVAC system at a fraction of the cost of typical multi-zone systems. Smart vent systems could react to demand response events by closing vents to rooms that aren’t being used at the time.
Smart Blinds– This integration makes a lot of sense. A smart thermostat could tell your automated blinds about a demand response event. If it happens to be in the afternoon like most of them are, the blinds would close to block the harsh afternoon sun and the heat that comes with it.
Smart Ceiling Fan ñ A ceiling fan can help lower your cooling bill by making your home feel cooler than it actually is. The light breeze created by the fan provides a wind-chill effect. Since you feel cooler, you can turn your thermostat up a few degrees to give your AC a bit of a break. This process could be easily integrated to occur during a demand response event. The smart thermostat would receive the signal and automatically raise its set point. It would then pass the signal to the smart ceiling fan. The fan would speed up and the end result would be a room that “feels” about the same temperature but uses less energy.
Smart homes can be a vital tool for energy management. They have the ability to help create a seamless relationship between power companies and their customers. Power companies can use this relationship to offer financial incentives to help control demand. The end result will be cheaper and more reliable energy.
Guest article written by: Eric Blank blogs about smart homes and other connected technology at thesmartcave.com. He enjoys sports, outdoors, technology, and dabbles in the dark realm of politics. He dreams of someday living in a castle on an island but for now will settle for smalltown, USA.