Peak hours and off-peak hours for electricity: all you need to know

Introduction:

As electricity demand surges during peak hours, traditional power grids face significant strain, leading to higher costs and potential reliability issues. However, solar + storage systems offer a game-changing solution. By effectively managing energy production and consumption, these systems can mitigate the effects of peak hours, ushering in a more sustainable and resilient energy future. This article examines strategies to alleviate peak hour challenges and discusses how solar controllers play an important role in optimizing solar + storage systems to overcome them. We will break down peak hours and how to deal with it.
Table of Contents

What are peak hours and off-peak hours?

If you are already familiar with this concept, you can skip to the next section. Peak hours for electricity refer to the specific periods during the day when the electricity demand is at its highest. These are typically the hours when a large number of people and businesses are actively using electrical appliances, devices, and machinery, resulting in a significant strain on the electrical grid. Off-peak hours, on the other hand, denote times of lower electricity demand when consumption is reduced, usually during less busy or nighttime periods.

How do solar peak hours differ?

Peak hours for solar systems, however, refer to the specific periods during the day when solar panels produce the highest levels of electricity. These golden hours typically coincide with the sun’s position at its peak, allowing solar arrays to capture the maximum solar radiation.

Understanding Peak and Off-Peak Hours: Factors and Timings

The exact timing of off-peak and peak hours can vary depending on various factors, including geographic location, weather conditions, and local consumption patterns. However, in most regions, peak hours for consumption typically occur during the early morning and evening, coinciding with people waking up and returning home from work or school, as well as when public buildings are lit. During these hours, the demand for electricity surges, leading to increased pressure on the grid infrastructure.

Time-of-Use Rates: Understanding Electricity Pricing and Production

Utility companies produce electricity at varying prices, just as consumers pay varying prices to use that energy. Electricity production costs are typically higher during peak hours. As a result, utility companies began introducing time-of-use rates.

See the table below to better understand this concept:

Peak hours - Time of use rates graph

Image source: PG&E

The purpose of peak hour pricing is to incentivize users to shift their energy consumption to off-peak hours when the demand is lower and the electricity rates are usually more affordable.

What is the impact of peak hours on businesses?

Peak hours can have a significant impact on businesses, particularly those heavily reliant on electricity for their operations. Increased rates can lead to a rise in operational expenses for businesses, especially for those engaged in energy-intensive activities. Additionally, the strain on the electrical grid during peak hours can result in occasional power fluctuations and outages, disrupting critical processes and causing productivity losses. To mitigate these challenges, businesses may need to implement energy management strategies, such as shifting non-essential tasks to off-peak hours, investing in energy-efficient technologies, or considering alternative energy sources. By proactively adapting to peak hour dynamics, businesses can better control costs, maintain operational stability, and enhance their overall sustainability.

What is the solution to mitigate peak hours?

As peak hours continue to exert pressure on electricity grids and strain business operations, finding effective solutions becomes paramount. By implementing smart strategies and leveraging modern technologies, it is possible to mitigate the challenges posed by peak hours for a cost-efficient energy landscape. In this section, we will explore various approaches and practical steps that businesses/building owners can adopt to optimize energy usage during peak hours. There are 3 main ways this is done:

1. Cut Consumption for Non-Critical Loads

Cutting consumption for non-critical loads is a key strategy to address peak hour challenges and optimize energy usage. Non-critical loads are appliances or devices that are not essential for the immediate operation of a business or household. These may include non-essential lighting, HVAC systems in unoccupied areas, water heaters during peak demand periods, or any non-urgent electrical equipment. For businesses, cutting consumption for non-critical loads during peak hours can lead to significant cost savings by capitalizing on lower electricity rates during off-peak times. It also helps to ease the burden on the electrical grid, reducing the risk of blackouts or voltage fluctuations during peak demand periods.

2. Use Other Sources of Production Like Solar

Despite a variety of renewable energy options available, solar energy is still the simplest way to go green. Through the use of renewable sources like solar power, building owners can reduce their reliance on the grid, allowing them to be more autonomous and resilient during peak hours. However, since golden hours (optimal sun exposure for solar energy) and peak hours do not coincide, the incorporation of an energy storage system becomes crucial.

3. Couple Solar with Energy Storage Solutions

Energy storage systems are essential companions to solar setups, especially during peak solar production periods. While solar power is a valuable renewable energy source, its generation is dependent on sunlight availability, which may not always align with peak demand periods. This mismatch highlights the need for a reliable storage system to store excess solar energy during non-peak hours and release it during high-demand periods. Read Why do you need an energy storage system to understand how to build up more self-sufficient installations. By integrating energy storage solutions like batteries, businesses can harness surplus solar power and utilize it precisely when electricity costs are at their highest. This strategy enhances energy self-sufficiency but also contributes to a more balanced and resilient electricity grid, reducing dependence on fossil fuels and bolstering sustainability efforts. A good way to maximize the usage of batteries is by using them with controllers. This type of situation is best handled by our ePowerControl ES for small-scale applications or ePowerControl MC for larger hybrid power plants.

Conclusion

Managing peak hours and implementing time-of-use strategies with the help of controllers is a smart and effective way to optimize solar energy usage. By smartly managing energy production and consumption, businesses and building owners can optimize energy usage, reduce costs, and enhance grid resilience. In part two, we will delve into the significance of solar controllers in optimizing solar + storage systems to overcome peak hour challenges. Discover how these controllers contribute to maximizing the usage of batteries, leading to more efficient and sustainable energy solutions. Follow us on Linkedin to be notified of our next article on peak hours!
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Khanya Gubangxa Content specialist at Elum Energy
Author: KHANYA GUBANGXA
Content specialist at Elum Energy

Khanya joined Elum energy in  2022. She has been reporting on solar and renewable energy since then.

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