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Inward Investment Guides
Trimming Rates by Cutting Peaks
Steve Stackhouse-Kaelble (Dec/Jan 10)
 
Keeping electric rates as low as possible can be more complicated than one might imagine. For Buckeye Power, a generation and transmission cooperative owned by 25 Ohio electric cooperatives, one piece of the puzzle involves trimming power consumption during those times of the year when demand tends to peak.

Many of the member cooperatives operate load management programs, which install special switches on customers' electric water heaters and air conditioner compressors. The switches are able to shut off the devices for short spells during peak usage times - typically for intervals short enough that the customer won't even notice.

This can reduce costs because a portion of the charges incurred by Buckeye Power is determined by electric consumption during the peak times experienced by the regional transmission organization to which Buckeye Power belongs. Another slice of the cost is set during the demand peak experienced by the transmission utilities serving member cooperatives. Controlling electric loads during these times of peak consumption actually can reduce charges for the following year. Paying close attention to these details isn't easy, but it's an effective way to keep a lid on power costs.



 
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