deSideCut your energy costs
The price you pay for electricity (under a standard retail contract arrangement) is typically calculated by:
The price the retailer pays to hedge your load in the wholesale market
+
A margin (of variable size) to cover the uncertainty in your load shape
+
The retailer's (normally small) sales margin
+
Several other margins
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The price you pay for energy
The key point here is that the price you pay is basically dependent on what price the retailer can get in the wholesale financial market for an approximation of your load shape. This price is dependent on what the market forecasts the average spot price will be over the period of the contract. Hence, if you consume electricity during times of high prices, you will end up paying for it.
Note that transport and other charges are added on top of the energy charge, and can be a significant portion of your overall cost, depending on where you are located.
If you have some flexibility in when you consume your electricity (i.e. you have some exposure to the spot market), then you might be interested in the following graph. This graph shows the size of the benefits that would have been available to a hypothetical energy user in the past, assuming:
- This hypothetical user consumed load evenly across the day, week, month and year (i.e. a flat load).
- This user was located within NSW (ie. subject to the prices present in NSW during those years).
- This user was able to interrupt their operations for a maximum of 10 hours per year.
If you are curious as to why the potential savings in 2006-2007 are lower than the other years, it is a result of the recent increase in energy prices across the board. The effectiveness or curtailing only 20 half-hourly periods in an entire financial year has significantly dropped.
Of course, curtailing only 10 (20 half-hour periods) in one year is a very small amount, the following graph shows just how fast your savings rise, and your average cost of energy falls as you take consecutively remove the highest half-hour periods. The data on this graph concerns the 2006-2007 financial year, for the NSW region, curtailing up to a maximum of 500 hours (1000 half-hourly periods), using a base load of 10MW and a peak load of 22MW.
As you can see, for the 2006-2007 financial year, you could have saved up to 22% on your energy costs simply by curtailing approximately 20 hours (40 half-hourly periods), a substantial saving indeed.
This graph was created using the Analysis Component of the deSide Client, using stock data. If you are really interested in finding out how curtailing can benefit your particular load profile, you can plug your raw load data directly into deSide, and run the query for yourself, quickly and easily.
You can make these savings a reality, and deSide can help. If you've heard enough, you can try deSide for absolutely no cost.