Moment Energy provides a clean, affordable, and reliable battery energy storage system (BESS) by repurposing retired electric vehicle batteries.
Peak shaving is a way to lower electricity costs by reducing peak energy demand. Businesses achieve this by using energy during off-peak hours or switching to alternative sources during peak times, avoiding high demand charges. Many businesses rely on battery energy storage systems (BESS) for this purpose, as these systems store energy when costs are low and discharge it during expensive peak periods.
By adopting BESS for peak shaving, businesses can lower electricity bills, avoid costly demand charges, and contribute to grid stability by balancing the overall electricity grid. Additionally, batteries improve energy reliability and provide backup power during outages—critical for high-energy industries like manufacturing plants or data centers.
In the USA, 30-70% of energy bills for businesses come from demand charges. Over a quarter of the 18 million commercial customers in the country face electricity tariffs with demand charges exceeding $15 per kilowatt (kW).
Peak shaving is a strategy used to reduce energy consumption during periods of peak demand when electricity costs are highest. It involves using stored energy and alternative power sources such as Moment Energy’s Luna BESS to avoid relying on the grid during these peak times.
The goal is to "shave off" the peak energy usage, thereby lowering costs and reducing the strain on the grid. A battery energy storage system will reduce peak energy demand by discharging stored energy during high-demand periods and charging during low-demand times. This flattens demand spikes, leading to lower energy costs and improved grid stability.
Demand charges are a key component of many commercial and industrial electricity bills. They represent fees charged by utility companies based on the highest level of power usage (measured in kilowatts, or kW) during a specific time interval, often 15 minutes, within a billing cycle. Think of it as a premium for using a lot of electricity during peak times when the grid is under the most stress. In certain regions such as California customers demand charges vary based on time of day, e.g. demand chargers for the highest usage between 4PM and 9PM are penalized hire more than any other time period.
Utilities need to maintain infrastructure capable of meeting peak electricity demands. To ensure they can handle these high-demand periods, they build and maintain expensive infrastructure, including power plants, substations, and distribution networks. Demand charges help offset these costs, incentivizing customers to manage their energy usage more efficiently during peak times.
Demand charges can significantly impact organizations with irregular electricity consumption, particularly during peak periods. Here are some real-world examples of facilities that often face high demand charges:
Large manufacturing plants face high demand charges due to significant energy consumption during production peaks. The U.S. Department of Energy suggests demand response programs as an effective way for industrial facilities to manage costs. These programs help businesses adjust energy usage during peak periods, alleviating grid stress while lowering expenses.
Fast-charging electric vehicle (EV) stations experience significant spikes in electricity demand when multiple vehicles charge simultaneously. For example, a site with multiple direct current fast chargers (DCFC) can see demand peaks of up to 1 megawatt (MW) when several vehicles are charging at once. Even infrequent peaks can lead to substantial demand charges, as utilities often calculate these fees based on the highest usage within a billing cycle.
Interestingly, some states not typically associated with high electricity rates—such as Colorado, Nebraska, Arizona, and Georgia—are among those with the highest demand charges.
Beyond early adopter states like California and New York, regions in the Midwest, Southeast, and Mid-Atlantic are also seeing an economic case for energy management and storage solutions.
Moment Energy designed the Luna BESS to store energy during off-peak hours and discharge it during peak demand, helping businesses reduce electricity costs. It uses high-capacity lithium-ion batteries to store and release energy, minimizing reliance on the grid and avoiding expensive peak pricing. The system can be paired with solar, wind, the grid, or diesel generators to increase energy efficiency.
Solar and wind power are fantastic clean energy sources, but their intermittent nature has challenged businesses. The sun doesn't always shine, and the wind doesn't always blow, making it difficult to rely solely on these renewable sources. This is where energy storage comes in, creating hybrid systems that combine solar power (or wind) with the reliability of stored energy.
Solar power with battery storage maximizes renewables and enables peak shaving. Excess energy is stored and later discharged during low generation or high demand, ensuring a steady supply and reducing peak charges. Let's run through how you can integrate peak shaving with solar and batteries!
Demand charges can account for up to 70% of the energy costs for nearly 5 million commercial customers in the United States. Many of these customers are enrolled in retail electricity tariffs that include demand charges. Peak shaving is a strategy that can reduce energy costs, improve reliability, and lower carbon footprint for businesses.
Moment Energy's Luna BESS provides a solution for managing energy demands, participating in demand response programs, and integrating renewable energy sources.
Miguel is the Marketing Project Manager at Moment Energy. He brings a comprehensive knowledge in advertising and marketing in a B2B setting. He has worked in several small and medium sized companies worldwide.
Miguel Resendiz
Marketing Project Manager, Moment Energy
miguel@momentenergy.com
