The single most effective way to reduce your electric bill is to adopt an alternative energy generating system. Today, solar is the most effective and affordable means to achieve this end.
Even when your solar power system remains tied to the traditional power grid, using the sun’s energy is certain to reduce your electric bills. But the utility company may not just charge you for the electricity that you use; they may also bill you for monthly demand charges.
This is why adopting photovoltaic technology may not completely eliminate your electric bills, as long as you are tied to the grid.
If you look at your electric bill, you will see a charge for the total amount of energy consumed, or in many cases, a credit for excess energy produced by your PV panel system. Along with that amount, you will also see the demand charge.
Demand refers to the rate at which electricity is used over a period of time, and this fee is charged at the highest average usage over any 15-minute interval of the current month.
In other words, the electric company calculates the maximum amount of electrical energy being consumed over a given time and charges a monthly fee to cover the demand. This charge is intended to ensure that the utility company’s generating and transmission capacity is sufficient to meet peaks in demand.
The amount you pay for demand is based upon the rate at which you used energy in the previous month, and even a single spike during one 15-minute time period can cause a high monthly charge. So, for solar system owners looking to reduce electric bills further, it can be helpful to regulate energy usage as much as possible, so that the panels produce enough energy to supply electricity during times of peak demand.
If your system can provide sufficient electricity, you will be able to decrease the rate at which you draw power from the grid. This will in turn lower demand charges and reduce power bills.
Switching to a different rate schedule with decreased demand charges may also be an option. This will result in higher energy usage costs, but if your solar system produces excess energy, you can sell it back to offset these costs.
Ultimately, to reduce the amount you are charged for demand and reduce electric bills, you must control your energy usage spikes. Using a battery system to store energy for when it’s cloudy or dark can help, particularly if you choose a system with demand response.
These systems detect when energy usage is increasing and kick in during these times to draw power from the battery, rather than the grid. Though most battery storage demand systems can only provide enough power for a short time, they can be effective for eliminating or reducing the spikes that cause high demand charges.
The other way to reduce demand charges is to ensure that your solar panel system is sized and configured properly for your needs. Whether you’re considering adopting solar technology or if you already have a panel array installed at your home or business, a professional solar company can help you evaluate your needs and determine the correct size and configuration that will be most economical for you overall.
Unless you decide to go off the grid entirely, you won’t be able to get rid of demand charges, but by following these tips, you can help minimize them. Contact Intermountain Wind and Solar today for more information and advice on how you can eliminate or reduce electric bills for good.
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