Historically, the price of electrical energy has been fixed and based on the price of fossil fuels required to generate the energy. Therefore, it did not matter when energy was used. That resulted in great demands on electrical power from many users at the same time and caused peaks of demands. These peak demands happen at times where most people need power, roughly around 08:00 and 18:00. Because it is unacceptable if power goes down, even in times of great demand, the grid and production of energy have to supply all this power. This results in an overinvestment in the energy system, which is only leveraged for around 2 hours per day.
To reduce these peaks and, thus, the required amount of power at any given moment and make the grid more stable, the behavior of energy users has to be influenced. With technological advancement it became possible to distinguish the use of energy between day and night. In the Netherlands, for example, you can agree with your energy supplier (energieleverancier) to split your energy in day and night tarifs (a special meter is required for this). In most provinces in the Netherlands the lower night tarif is between 23:00 and 07:00. This means you can save on your electricity bill by programming your dishwasher and laundry machine to run during those hours. Be aware though, that with a double tarif you pay even more for the energy used in day-time as compared to a fixed rate. In order to know if a double tarif is an attractive option financially, you need to know your energy usage during the day and at night.
Recent developments made it possible to distinguish the use of energy even further and get a flexible price for your energy per day or even per hour, see apxgroup for an example (we have no affiliation with apxgroup). This way you can optimise your production to reduce energy costs and help stabilize the grid at the same time. Prices of electrical energy are determined at 13:00 for the next day. As a case study we can take an example of heating a batch of produce with a heat pump or electric heating element for pasteurization purposes. The day before, you can check which hours will have the lowest energy cost within your preferred time frame and let the heating process run in those hours. If you do not want to do the planning manually, you can choose to automate this process and let a simple algorithm determine the best time to run your production processes, taking into account your timing requirements.
We would love to know how running production processes at most optimal times of the day benefited your business. Please share your comments below.
If you would like to work together on an automation solution for your production plant, please send us a note via the contact form.
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