What is Peak Demand and How Does it Impact Rates?

PowerSouth Energy Cooperative, the company West Florida Electric (WFEC) purchases its power from, bills using two components: demand and energy. In turn, WFEC charges residential customers an average of the demand and energy components charged by PowerSouth, as part of each member’s monthly bill.

Demand for energy has an impact on West Florida Electric’s (WFEC) member-owners because significant increases in that demand drive prices up. Because of increased demand for electricity WFEC is taking steps to reduce it and levelize energy consumption. The primary focus is to levelize the kilowatt consumption of our members so we can plan and dispatch generating resources in the most efficient manner, eliminating peaks and valleys on the distribution grid.

Peak demand or peak load are terms used in energy demand management describing a period in which electrical power is expected to be provided for a sustained period of time at significantly higher than average supply levels. Peak demand fluctuations may occur on daily, monthly, seasonal and yearly cycles. For an electric utility company, the actual point of peak demand is a single half hour or hourly period which represents the highest point of customer consumption of electricity.

West Florida Electric’s peak demand times are approximately 4:00 p.m. until 8:00 p.m. in the summer and 5:00 a.m. until 8:00 a.m. during the winter. To help reduce this demand and lower energy consumption, WFEC members should avoid doing laundry, showering, cooking or other activities that use large amounts of energy during these times. Taking part in some of the cooperative’s energy saving or load control programs can also help reduce demand on the co-op’s distribution system.

“Anything you can do as a consumer to reduce your energy consumption during these peak times, helps to lower the average cost for every West Florida Electric member-owner,” said Gary Clark, Vice President, Member Services.

Energy efficient programs primarily seek to reduce customer energy use on a permanent basis through the installation of energy efficient technologies or practices. Load management programs generally focus on either curtailing or shifting demand from high cost, peak demand periods. There are overlaps between energy efficiency and load management programs. Reducing peak demands may also yield energy savings, and most energy efficiency programs also yield some peak demand savings.
The cooperative will be implementing a load management program called H2O Plus in early 2009.

“The primary goal of this program is to reduce the daily peaks and valleys in electric energy demand in an effort to make the most efficient use of energy resources,” said Rhonda Byrd, Manager of Energy Services. “It is designed to keep electric rates stable for all members and increase off-peak kilowatt-hour sales,” she continued.

H2O Plus is an innovative program that puts technology to work in an effort to save energy. Storage electric water heaters are equipped with a special device designed to allow WFEC to monitor and control the water heater’s electrical usage during periods of peak demand. The water heater has sufficient storage capacity; therefore it will not only continue to meet the consumer’s needs for hot water during peak periods, but also reduce the effects of peak demand throughout the cooperative’s service area. Since WFEC has a 92 percent saturation rate of electric water heaters throughout its membership, domestic water heating is a viable option for targeted load control which will provide both summer and winter peak saving benefits. All WFEC residential customers with new or existing fifty gallon electric water heaters qualify for this program. Members who would like to replace their gas water heaters also qualify. For more information on this upcoming program, contact the Energy Services department and look for more information in this publication.

WFEC’s Touchstone Energy® Home Program is another energy-saving program for members who are conducting new home construction or existing home renovations. Our Energy Services department will need to see a copy of your house plans to make sure the Touchstone Energy® Home energy efficiency standards are being met and incorporated into your plans. The Energy Services department will also ensure your heating and cooling unit is sized properly for energy savings and comfort levels in your home. Qualifying for this program also entitles you to a free water heater. Call our Energy Services department for more information about the Touchstone Energy® Home program or visit our Web site, www.westflorida.coop for more information about this and other energy efficiency programs offered by the cooperative.