AM I CHOOSING THE RIGHT POWER?

OPTIMISATION OF ELECTRIC POWER

AM I CHOOSING THE RIGHT POWER?

Optimisation of electric power:

When we speak about optimising the electrical power the question that comes up is: am I choosing the right power?

The comparative analysis between the power hired and the power used should be a fundamental task for businesses. This analysis can reduce the power bill between 5% and 25% like in the case here presented.

In 2013 all energy distribution companies in Spain required all their customers to sign for a specific electric power in their supply points. Depending on the power hired, they charge a fixed amount. This is known as the fixed power fee, that has been increasing, becoming a burden in the electric bill (read related article here).

Escission is not an energy retailer. Therefore, the efficiency analyses carried out are completely objective, ensuring the customer will be able to make the most of their energy bill.

We look for an answer to these questions:

  1. Is the power we have hired the necessary one?
  2. Can the kW rate be improved?
  3. What penalties could I face if I exceed the power for which I signed for and how to avoid it?

DESCRIPTION

The aim of this project was to minimise the cost of the energy bill, by decreasing the fixed power fee, while maintaining the service to the dependent premises and without incurring in excessive usage that would in turn penalise the customer. 

 

We need to bear in mind that the power required in the premises must sit between the 85% and 105% of the power hired. According to the R.D. 1164/2001 (Spanish Legislative Royal Decree), in which a series of brackets are fixed for the 3.0A tariffs. For example, if the potentiometer shows:

  1. Less than 85% of the hired power: 85% of the full hired power will be invoiced.
  2. Between 85% and 105% of the hired power: the amount read on the potentiometer will be invoiced.
  3. More than 105% of the hired power: the customer will be invoiced for the value shown on the potentiometer plus twice the difference between that value and the corresponding to the 105%.

The customer originally had the following arrangement of electric power:

 

P1

P2

P3

Power (kW):

110

110

110

We assume the following rates for each of the brackets:

 

P1

P2

P3

Rates (€/kW and year):

43,71665833

27,43729333

19,29158833

With this distribution, the fixed power fee was an average of 8793,01 €/year

What are the alternatives for the customer to save in this fixed fee?

After analysing the historic data provided by the customer, we concluded that there were two possibilities depending on their risk profile:
  1. A determinist alternative, in which the historic use of power measured in the potentiometer is used as the base to calculate the future usage. This would achieve a reduction of the fixed fee with an associated saving of 468,44€/year on average. However, the probability of the variability of usage resulting in losses is non-negligible.
P1 P2 P3
Power (kW): 89 101 93

This is the formula used by most of the energy efficiency companies when they offer a consumption study. The issue with this setting is that the savings are not ensured if:

    • the client begins to change their consumption habits or
    • the energy distributing companies change their tariffs
  1. The second alternative takes into account the uncertainty and the possible changes in the usage. It intends to adjust the monthly usage peaks to a probability distribution, that in this case follows a distribution generalized extreme valuesand to account for the seasonality of the data.
P1 P2 P3
Power (kW): 92 106 91
*(The full report can be accessed at the bottom of the page)* With this formula the average saving is up to 458,77€/year, slightly less than the deterministic approach; however the risk of incurring in losses if the hired power is not changed is lowered. If the customer is risk averse, the best option is to select the alternative that does take into account the variability. If the customer is willing to take more risks, the determinist alternative could also suit them.

In both cases the alternatives are more beneficial than the current situation, saving around 6% on average.

An additional advantage of the proposed methodology is that we can suggest changes in the hired electrical power for customers that had solar panels installed. With past weather information and the characteristics of the system installed, we can add that information to the historic usage data and select the most suitable power in the new configuration, without having to wait one or several years to have enough data.  

Additional information

In order to understand how the adjustment methodology used in this project, you can access the article used as a reference

Please, note the original article is written in Spanish. If you cannot read Spanish, no worries, please contact us and we will be happy to discuss with you in English. 

Details

Project: Analysis of the potential reduction of hired electrical power

Date: Fourth quarter 2019

Resources

Download our full report about Power Optimization: what power should I hire?