What is a Demand Based Tariff?
A “tariff” from your electricity supplier is a schedule of fees that you pay to buy your power. Demand Based Tariffs are the result of how energy companies produce and buy power to supply you with. During periods of peak demand, they need to buy power from outside sources or generate more power at a premium cost.
Tariffs in 3-Parts
Demand tariffs charge customers in 3 parts:
- A monthly service fee
- A usage fee (kWh)
- A demand charge (kW)
Demand Charge
The demand charge is a measure of your maximum instantaneous draw, or the most power you ever use all at once during on-peak hours. Older, traditional residential tariffs only have a monthly service fee and a usage fee.
The key to saving money with Demand Based Tariffs is to reduce high grid energy use during peak hours, which are typically late afternoon to early evening (3-8pm). By implementing an appropriate Distributed Energy Resource (DER) solution like solar battery storage, and/or solar monitoring, you can leverage these tariffs to save significant money now and future-proof your investment.
Distributed Energy Resource Solutions in Phoenix
SouthFace Solar & Electric is a pioneer, innovator, and leader in distributed energy resource solutions in Maricopa County. We have been designing and deploying grid-tied and off-grid solar energy systems for over 12 years. There are two major resources that can help you save on your demand based tariff costs:
The Importance of Monitoring Your Energy Usage
If you don’t know when and how you are using the most energy, how can you optimize it for savings on your energy bill? Energy monitoring is essential to getting the most out of your solar PV system and is a large part of every SouthFace Solar & Electric solar solution.
Fortunately, understanding how your home or business uses energy has never been easier. Many energy monitoring products can be installed with minimal effort that syncs to your computer or smartphone. The Sense Energy Monitor is a great example. Sense has a low initial investment, but the information it provides will guide you on how to become more energy efficient. This will begin to shape energy strategy.
Solar Battery Storage
If you want to increase the flexibility of your solar energy so that you can use your renewable energy during times of low energy production, you will need a way to save that solar energy. Solar battery systems allow you to store your excess solar energy for times when your solar roof or ground mounted system are not producing energy, like overnight or during the occasional extra-cloudy day. They can also protect you from unexpected blackouts!
With a demand based tariff, homeowners can also draw from their stored electricity to use during peak periods to offset or avoid high peak demand charges from their utilities.
Giving You the Power to Choose
We believe, by using advanced technology in a simple way, we can give people a choice in energy independence. This foundational ideal permeates throughout all aspects of SouthFace Solar & Electric. Through this mantra we give you, the consumer, the Choice of Power – the power to claim your energy independence! Tired of waiting to do laundry or not running air conditioning due to high on-peak utility rates? We can help. At SouthFace Solar & Electric we have helped thousands of people like you achieve this reality. Let us know how we can help you!
Make the best choice when it comes to your future solar energy — SouthFace Solar & Electric gives you the power to choose. Schedule a free solar quote by calling 480-636-1800 or get in touch here.
