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Guide

Peak shaving with battery energy storage

On most commercial tariffs, a large share of the bill is set by your worst fifteen minutes. Storage is how that gets flattened.

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Consumption and demand are billed differently

A commercial electricity bill usually has two main components. Consumption is what you used, in kWh, priced per unit. Demand is how hard you pulled at your worst moment, in kW, usually assessed over a short interval — often fifteen minutes — and charged at a rate that applies for the whole billing period.

That structure has a consequence people find counter-intuitive: a single compressor start, a shift changeover, or one EV charging session can set a charge that applies all month, no matter how careful consumption was otherwise.

How the battery intervenes

The system monitors site demand. When draw approaches the threshold you want to stay under, the battery discharges to make up the difference, so the grid never sees the peak. When demand is low — overnight, at weekends — it recharges.

The site's measured peak falls to the threshold, and the demand component of the bill falls with it. Nothing about how the site operates has to change, which is what distinguishes peak shaving from load management schemes that ask people to work differently.

Three related mechanisms, often confused

What decides whether it pays

FactorFavourableUnfavourable
Tariff structureHigh demand charge relative to consumptionConsumption-dominated tariff
Load profileSpiky — short high peaksFlat — constant draw
Peak durationShort, predictableLong, sustained
Peak frequencyA few per dayContinuous
On-site generationRooftop solar presentNone
New loadsEV charging being addedStatic load

Why interval data is the only real input

Peak shaving is arithmetic, and the arithmetic needs your actual half-hourly or quarter-hourly data. It tells you how high the peaks are, how long they last, how often they occur and how much energy is needed to cover them — which together determine both the kW rating and the kWh capacity of the system.

A rule of thumb cannot do this, because two sites with identical annual consumption can have entirely different peak structures and entirely different answers. Send twelve months of interval data and we will tell you what the saving looks like — including if the answer is that it does not pay.

Questions answered

Frequently asked questions

What is peak shaving?

Using stored energy to cover short periods of high demand so the site draws less from the grid at its peak. Because commercial tariffs often charge on the highest demand recorded in a billing period, reducing that peak reduces the charge.

Can BESS reduce demand charges?

Yes, where the load profile has peaks a battery can cover. The size of the saving depends on the tariff structure and how spiky the profile is, which is why interval data is the starting point.

How does peak shaving differ from load shifting?

Peak shaving targets the demand charge by reducing the maximum draw. Load shifting targets the consumption cost by moving energy use from expensive periods to cheap ones.

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