Exploring Demand Charge Savings from Commercial Solar

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Commercial retail electricity rates commonly include a demand charge component, based on some measure of the customer’s peak demand. Customer-sited solar PV can potentially reduce demand charges, but the magnitude of these savings can be difficult to predict, given variations in demand charge designs, customer loads, and PV generation profiles. Moreover, depending on the circumstances, demand charges from solar may or may not align well with associated utility cost savings.

Lawrence Berkeley National Laboratory (Berkeley Lab) and the National Renewable Energy Laboratory (NREL) are collaborating in a series of studies to understand how solar PV can reduce demand charge levels for a variety of customer types and demand charges designs. Previous work focused on residential customs with solar. This study, instead, focuses on commercial customers and seeks to understand the extent and conditions under which rooftop can solar reduce commercial demand charges. To answer these questions, we simulate demand charge savings for a broad range of commercial customer types, demand charge designs, locations, and PV system characteristics. This particular analysis does not include storage, but a subsequent analysis in this series will evaluate demand charge savings for commercial customers with solar and storage.

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