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Demand Charge Reduction with Peak Shaving
For many businesses the biggest electricity cost is the single highest 15 minutes of demand. Storage attacks exactly that.
01Introduction
What this article covers
A large share of a commercial bill is the demand charge — a fee based on the highest short-window power draw in the period. Battery storage can shave that peak by discharging exactly when demand would otherwise spike.
02Technical
How demand charges work
Utilities often bill the peak 15-minute (or similar) average demand separately from energy. Even a brief spike sets the charge for the whole period, so smoothing the peak has outsized value.
03Technical
Peak shaving in practice
The EMS forecasts or detects an approaching peak and discharges the battery to keep site demand under a target. The battery then recharges off-peak or from solar. The result is a lower billed peak and a lower demand charge.
04Technical
Sizing for the peak
Peak shaving is power-limited: you need enough kW to cover the targeted reduction for the short peak window, which may need only modest energy. This is why it often needs less capacity than backup.
05Technical
What drives the case
The business case follows the tariff's demand structure and how sharply the site's load peaks. A site with a tall, brief peak and a high $/kW demand rate is the classic good fit — modelled from its own meter data.
06Related Products
Products referenced
Referenced in this article
Commercial & Industrial ESS
Systems sized to shave the site peak.
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10FAQ
Frequently Asked Questions
What is a demand charge?
A fee based on your highest short-window power draw in a billing period, billed separately from energy used.
Why is peak shaving effective?
It trims the brief spike that sets the demand charge, so a small discharge at the right moment can cut a large part of the bill.
Does peak shaving need a big battery?
Often not — it is power-limited and may need only modest energy for the short peak window.
Put this into your project
Talk to StorXing about sizing, integration, and delivery for your site.