Last updated on October 14th, 2019
In order to understand the peak shaving definition, we must evaluate examples, meaning and the benefits of using peak shaving in practical application.
What does peak shaving mean?
Peak shaving is the act of reducing reliance of load during peak demand hours. By peak shaving, you can reduce your cost by having a resource on hand that will directly supply you with the consumption instead of relying on a specific supply that processes the entire industry.
The definition of peak shaving means you can save money by reducing demand (or self consume) during peak times.
Here is a brief overview of peak demand to help you understand how to reduce your electricity costs.
Peak Shaving Definition and Practical Examples
The definition of peak shaving can be applied to any application. However, as it relates to power and energy, peak shaving has a specific definition.
The process for peak shaving can be seen in a number of instances, most commonly, natural gas and power.
- For natural gas: The process was historical seen in natural gas supply during periods of extremely high demand. The use of liquefied natural gas (LNG), propane or drawing of resources from pipelines
- For power: Peak demand occurs when individuals require consumption of power during the night time. With the rise of intermittent resources (such as renewable energy), peak demand cycles have been much more drastic since solar power is not generated at night time.
Peak shaving saves customers money by offsetting the electricity consumed from the grid at the highest peak pricing hours with power provided from energy storage system batteries. A typical peak shaving system requires between one (1) to two (2) hours of storage capacity.
Peak shaving and demand response will be critical drivers of energy storage growth in the future.
Benefits of Peak Shaving
The definition of peak shaving clearly has benefits for its practical use in energy and power. Peak shaving has a number of different benefits and applications most notably the following:
- Peak shaving saves money
- By shaving you demand during peak hours, you become less reliant on other resources
- In case of a blackout and by having a peak shaving resources, you can have more resiliency throughout this period of time
What do you think of our peak shaving definition? Please let us know if you’d like to see more content and examples of peak saving.
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