Peak Shaving with Photovoltaic Installations

Photovoltaic installations not only contribute to reducing energy consumption costs but also offer additional savings through a concept known as “peak shaving.” This article aims to shed light on peak shaving and how it provides an avenue for saving on electricity bills beyond the direct production of solar energy.

1. Traditional Savings: Electricity Consumption Reduction: Solar panels on rooftops generate electricity, reducing dependence on grid-supplied power and resulting in direct savings on energy consumption.
2. Peak Shaving Explained: Maximum Power Demand: Many households experience peak power demand during hours of abundant sunlight, such as hot summer afternoons with air conditioning running at full capacity. This peak demand determines the contracted power term, a recurring expense on monthly bills.
3. Solar Production during Peak Demand: Photovoltaic systems produce significant energy during peak demand hours, allowing homeowners to draw less power from the grid. This reduces the contracted power and, consequently, lowers the associated costs. c. Role of Batteries: Integrating batteries into the solar system enhances the peak shaving effect. Even during non-sunny hours, batteries can supply energy to cover demand peaks without relying entirely on contracted grid power. This flexibility enables a substantial reduction in contracted power levels.
4. Realizing Greater Savings: a. Contracted Power Reduction: With efficient peak shaving, it is possible to decrease contracted power levels significantly. For example, a household may reduce its contracted power from 5.75 kW to 1.15 kW, resulting in substantial cost savings over the fixed term. b. Taxation Savings: A considerable portion of utility bills includes taxes calculated based on the bill’s total expense. As photovoltaic systems contribute to bill reduction, the taxes paid, including VAT and electricity tax, decrease proportionally, leading to additional overall savings.

Understanding and implementing peak shaving with photovoltaic installations is a strategic approach to maximize savings on electricity bills. By aligning solar energy production with peak demand hours and leveraging battery storage, homeowners can not only reduce their reliance on the grid but also achieve significant reductions in contracted power levels. These combined efforts not only lead to direct monetary savings but also contribute to lower taxation on utility bills, providing a comprehensive approach to cost-effective and sustainable energy solutions.