Critical peak demand days, Eastern Victoria
If you operate a medium to large business in Victoria, Australia, chances are that ‘Critical Peak Demand Day’ charges will account for a large part of your annual electricity cost. Most managers focus on the ‘retail’ component, but the Critical Peak Demand charge (which almost nobody is aware of) can account for about the same amount. Have a look at this example.
In the 2015-16 Summer, Victoria has only had a few hot (over 40°C days), and these were during the holiday period, so fewer businesses were running.
AusNet, the operator of the electricity distribution network in the Eastern half of Victoria, is in a bit of a bind. It has until the end of March 2016 to declare up to four critical peak demand days. The higher the demand on those days, the more revenue AusNet will receive, so it should aim for the hottest days. But there are no really hot days forecast, and the longer Ausnet leaves it, the cooler the weather is likely to become. So it will be interesting to see what Ausnet decides to do.
Monday 22 February (forecast 30°C) has been declared a Critical Peak Demand Day and Tuesday (forecast 35°C) will almost certainly be declared a CPDD.
Take action to reduce your electricity costs for a whole year.
Reducing electrical power demand between 3 p.m. and 7 p.m. (daylight saving time) will help to reduce the CPDD charge for a whole year, for electricity customers on one of the following network tariffs: NSP56, NSP75, NSP76, NSP77, NSP78, NSP81, NSP82, NSP83, NSP91, NSP94 and NSP95. (check the back of your electricity invoice).
More details here: http://www.ausnetservices.com.au/Electricity/Managing+Usage/Critical+Peak+Demand+Tariff.html
The Critical Peak Demand charge typically accounts for about 15% industrial customers’ total electricity cost.
So reducing demand for 4 hours, can result in significant savings.
If you would like to discuss ways of reducing critical peak demand, the capacity charge, and other electricity costs, please phone us to discuss.