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Save Money by Implementing Peak Demand Strategies

Save Money by Implementing Peak Demand Strategies

Is it possible to use more energy, while at the same time lowering your overall energy cost?

Is it possible to use more energy, while at the same time lowering your overall energy cost?

While I need to flesh this out—the answer is yes.  Of course our goals should be managing our energy to the best of our ability, but there are other aspects of our energy use that we must understand.

Electric Use Breakdown:
Our electric bill is measured in a number of ways.  One is kWh or Kilowatts per hour.  The kWh you see on your electric bills are the total number of kilowatts used in a billing cycle (typically 30 days).  Rates per kWh vary, but range from $.06-$.15 per kWh.  KWh is directly tied to our energy use.  If we use more kWh and thus cost increase, if we use less our kWh and thus cost decrease.  However there is another area of utility bills we MUST understand, as many churches (not all) are being charged.  This area is called peak demand.

Understanding Peak Demand:
Peak Demand or kW is energy measured over a 15-minute period of time.  The utility company will then charge you for the HIGHEST 15-minute period for a given month.

For example if your average kW is around 150 kW, then during a very busy and very hot time of the day you decide to turn on all HVAC, Lighting, and plug load your kW spikes to 250.  You will not be charged the 150 kW in reference to peak demand.  The utility company will charge you the 250 kW x the demand rate $10 (fluctuated per region), this means you facility will pay $2,500 opposed to the $1,500. 

Not only this, but also most areas charge an annual Peak Demand (can also be called Ratchet Demand), where the utility will charge the client for the highest kW during a given year. 

For example: Church-A averages 250 kW per month, but during a hot Friday in July the church schedules an outreach event.  The kW skyrockets to 450 kW.  The church will be charged the 450 kW for the next 11- months and not the 250 kW.  This not only impacts the month, but impacts the entire year.  450 x $10 x 12 months = $54,000 compared to 250 x $10 x 12 Months = $30,000.  This one event cost the church $24,000.

There is allot of information I am glossing over, rates of peak demand differ ($4-$18/kW), the way peak demand is charged differ (some charge 80% of peak use, some only charge for 6 months), however this is a very real charge.  This is also a very understandable charge, as utility companies must prepare for electric spikes during peak periods, this cost is of course passed of to the customer.  Peak demand is only charged during peak time.

Peak periods on averaged are only during the months of June-September, Monday through Friday, from the hours 2pm to 6pm, however this to can differ per region, there is also winter peak periods in some regions.

Our behavior can have a strong impact peak demand:
The way we use energy during peak period can make a strong impact on our cost. 

Knowledge is power, for example if we know peak demand is from the hours of 2pm-5pm, Monday through Friday, June through September, then we can adjust the schedules of our church to minimize use during peak times. 

The good news about churches is that most large meetings are on Sundays, however this does not mean we do not use the church during peak hours.  Perhaps your church decides to adopt a rule that disallows large meetings during peak hours.  Or perhaps during peak months you adopt a summer schedule for staff (7am-2pm Monday-Friday). 

Or perhaps you decide to only occupy one zone of the church, while keeping other HVAC zones in minimal or set back periods. 

There are a number of ways to adapt our use during peak times, and I encourage the churches to reach out to their energy consultant or find a consultant that can assist in this area.  One specific organization we met with saved over $100k by simply changing the way they operate during peak periods. We encourage churches to investigate if being charged peak demand, the hours of peak demand, the rates and more.  Keep in mind this is for electricity only and not for gas. 

Also keep in mind that electricity is typically 3 times the cost of gas.  For areas that are charged winter peak demand, electric heat makes a big impact.

Other areas that impact peak demand:

Lighting minimize light use, turn off when gone longer then 23 seconds
Plug Load Unplug items in the wall or invest in plug load adapters.
Building Envelope Keep doors and windows well insulated and closed.
HVAC Makes up (on average) 50 percent of a building electrical load. Set back HVAC to higher temp, only turn on zones that are occupied, minimize occupancy hours, turn off when not in use, and more.

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