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Avoiding Peak Power Rates With Real-Time Energy Management

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This piece is part of a new series that was created in conjunction with The New York State Energy Research and Development Authority to help educate the real estate community about the positive impacts of Real Time Energy Management.

The purpose of buildings is to be safe and comfortable structures for people. Buildings shield us from unpleasant weather like heat waves and high winds while offering us a pleasant environment to live, work and play in. Keeping buildings comfortable is closely attributed to room temperatures and other indoor air quality characteristics such as humidity, cleanliness and more. However, when the outside temperature is at odds with the desirable indoor environment, it can become costly to reach true comfort.

Offices have the reputation for being too cold leading to employees wearing layers, bringing blankets, or plugging in personal space heaters under their desks – much to the chagrin and horror of building or facility maintenance teams. Meanwhile, battles over the home thermostat weigh the value of comfort vs. cost savings. Which one is more important? We’ll never have a true answer to the ongoing battle, but there is a way to satisfy both sides of the argument.

Simply put, energy costs more when it’s demand is the highest. These hours, called peak hours, are weekdays from 8AM to 10PM. The rates during peak hours can differ greatly from those during off-peak hours which are weekdays from 10PM to 8AM and all day on weekends. Con Edison, one of the world’s largest delivery systems and serving 10 million people in New York and Westchester counties, clearly states their energy rates for both residential and business buildings. For businesses, peak rates from June 1 to September 30 are 31.550 cents/kWh and 15.530 cents/kWh for peak hours during all other months. Year-round off-peak rates and weekend rates are 1.150 cents/kWh. With peak hours possibly being almost 30x higher than off-peak hours, minimizing energy use during peak hours just makes financial sense.

The cost of energy isn’t just a measurement of what you’re currently using, it’s also a result of your peak energy from the previous year. For example, Con Edison calculates a building’s entire year’s energy rate by its peak daily load and for every 100kW increase in demand, it is expected to increase the annual energy cost by up to $20,000. To understand why this matters, there are a plethora of metaphors but one we can all understand is mall parking lots. These large lots are at a percentage of full capacity on any normal day but are sized to fit the parking requirements for the busiest of holiday shopping days. Energy must also be prepared year-round to meet the highest demand it will experience and, thus, buildings are charged for it.

Understanding how these fees are charged, it is clear that a momentary slip-up could increase the energy costs of a building for the next year. With previous energy meter readings coming in monthly, there was no way to be alerted to a possible spike in energy use and the intelligence to know how to prevent it before Real Time Energy Management (RTEM) systems entered the scene.

RTEM systems use the latest technology to inform and assist building operators in managing and consuming energy. Through continuously collecting live and historical performance data in cloud-based or on-site systems, RTEM analyzes data to discover opportunities to save energy and money through the building’s energy usage. This data comes from building systems like HVAC, sensors, meters, and other equipment. 

With RTEM, preventative measures can start systems earlier on the hottest days so that less energy is used during peak hours, reducing usage costs as well as avoiding demand peaks. With known parameters on when to decrease energy usage, there is now opportunity for a plan or strategy to reduce costs and save energy on a consistent basis. RTEM data is effectively the only way to precisely monitor and strategize on how to bring down next year’s energy costs in real time.

Sensors have brought abundant data to building operators which can be used to maximize both comfort and energy efficiency of buildings. Occupancy sensors can send real time information about whether a room is being used or not and directly tie into building systems that keep it cool, window treatments to block or let in heat-creating sunshine, or lighting systems so that an empty room is a dark room instead of a misuse of electricity. Sensors connected into the sophisticated software of RTEM systems provide immediate and accurate data so what is happening within the building can be done in the most efficient way possible.

The intelligence of RTEM systems doesn’t stop at technology within the building but also incorporates outside data, enabling processes to be done during off-peak energy usage hours. By delaying processes to preferred hours when energy is in less demand and less expensive, buildings can meet all operational requirements while saving money. RTEM systems are able to integrate operational preferences such as off-peak hours, occupancy sensors, HVAC runtime, and more as technology becomes more accessible and inexpensive with expanded capabilities and integrations.

Buildings after COVID-19 are not operating with the same patterns of past years making energy-related and energy-saving strategies a bit of a guessing game. While weather can be somewhat expected, the patterns of people coming into offices, where they sit, how long they stay, and if they work from home instead, are hard to predict. Fortunately, real time data makes the unexpected manageable while eliminating wasteful energy expenditure.

The New York State Energy Research and Development Authority, known as NYSERDA, promotes energy efficiency and the use of renewable energy sources. These efforts are key to developing a less polluting and more reliable and affordable energy system for all New Yorkers. Collectively, NYSERDA’s efforts aim to reduce greenhouse gas emissions, accelerate economic growth, and reduce customer energy bills. NYSERDA works with stakeholders throughout New York including residents, business owners, developers, community leaders, local government officials, university researchers, utility representatives, investors, and entrepreneurs.

NYSERDA offers cost-share incentives to support RTEM projects that serve customers in commercial, industrial, and multifamily sectors. Its Advanced Efficiency Solutions team evaluates and qualifies vendors to ensure high quality RTEM projects and analyzes RTEM market data to publish case studies and best practices.

Prospective customers can learn more about RTEM benefits and how to get started here. All of NYSERDA’s informational materials can be found in the RTEM Resource Center. Vendors interested in qualification should apply today.

For questions and help, email [email protected]

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