The Big Picture
EastLink manages one of the largest tolled roadways in the State of Victoria, Australia. The fully electronic tollway links major roadways from east to south-east of Melbourne. Like many enterprises, EastLink was exploring ways to reduce energy costs and reduce the environmental impact from energy use at its energy intensive EastLink Operations Centre.
In December 2013, EastLink deployed EnerNOC’s energy intelligence software (EIS) and enlisted the software provider’s professional services team to gain a better understanding of key energy cost drivers – how they buy it, how much they use, and when they use it. With visibility into its real-time energy data and advice from EnerNOC’s team of energy management experts, EastLink was able to identify significant savings opportunities, resulting in an 8% reduction in energy spend.
Tackling Critical Peak Demand Charges
Peak demand charges can be a large component of energy bills for enterprises like EastLink. A system demand charge, sometimes called a capacity charge, reflects the maximum amount of electricity usage an individual site will need at any one time to conduct its business (this may be measured as kVA or kW by different utilities). System demand charges cover the cost of the overall operation, maintenance, and replacement of the electric distribution system. Instead of building new infrastructure, which can be time- and cost-intensive, utilities often ask large enterprises to reduce their energy usage on days when the electricity grid experiences very high levels of usage, calling a critical peak demand day. Many utilities have also introduced penalties (known as critical peak demand charges or coincidence peak charges) to penalise businesses that do not reduce their electricity usage on the specified days.
EnerNOC identified that EastLink was subject to a critical peak demand charge at its Operations Centre. In EastLink’s case, this charge is determined by the maximum electricity demand at the business site (measured as kVA) between 3pm and 7pm on five discrete days nominated by AusNet Services, EastLink’s utility. These critical peak demand days occur between December and March each year, when overall demand on the electric grid is at its highest. AusNet Services notifies customers like EastLink of these days 24 hours in advance of each nominated day, giving them a chance to respond and reduce overall energy consumption at their respective facilities. AusNet Services then calculates each facility’s average peak demand on those five days. This average peak demand is then used to calculate the “demand critical peak component” of a customer’s energy bill for the following 12 months. EnerNOC helped EastLink quantify the impact of this charge for its facility, which totalled $26,000 per annum, representing 8% of the facility’s annual electricity spend.
Proactive Demand Management
In order to alleviate these charges, EastLink relied on EnerNOC’s demand management tools. When a critical peak demand day was called by AusNet Services, Eastlink received day-ahead notice, delivered via phone, email, and SMS from EnerNOC’s Network Operations Centre (NOC) in Melbourne. During the peak demand assessment window of 3pm to 7pm on these days, EastLink staff implemented the customised energy reduction plan it had prepared in consultation with EnerNOC. This involved using a combination of stand-by generation and reducing non-critical electricity usage at the site.
By working with EnerNOC’s team, the EastLink staff was able to understand how and when to take action in order to avoid peak demand charges, and by tracking their consumption in real time with EnerNOC’s software, the team was better able to accurately quantify the magnitude of annual savings long before the annual demand charges showed up on the following year’s bill. Best of all, EnerNOC made the process simple. “Working with EnerNOC was a smooth process to achieve maximum savings and helped us gain a better understanding of our electricity use profile. When EnerNOC approached us, they demonstrated knowledge of the various tariffs and quickly showed us how we could achieve savings. They gave us support to identify the appropriate way to reduce our energy demand and helped us set up communication protocols to ensure we coordinated our activity effectively,” said Alex Monson, EastLink’s environment manager.
Reducing Environmental Impact
In addition to the financial benefits of reducing energy usage on these critical peak demand days, managing peak demand is an environmentally-responsible alternative to relying on fossil-fuel burning peaking power plants. This positive environmental impact was attractive to EastLink, a company committed to being a responsible corporate citizen. “Working with EnerNOC has provided EastLink significant cost savings by reducing energy use during peak periods, but it’s also good to know we are also making a positive contribution to the environment,” says Monson.
Tracking Performance in Real Time
Utilising EnerNOC’s energy intelligence software, EastLink was also able to monitor its energy reduction in real time, throughout a critical peak demand day demand response (DR) dispatch, helping to ensure that energy reduction targets were met and that the company was maximising its savings opportunities. EnerNOC’s Network Operations Centre staff also monitored the performance remotely, ensuring they were on hand to assist facility staff if EastLink was not tracking to the agreed energy demand reduction target.
Dollars to the Bottom Line
By taking action during only five key days, EastLink reduced its assessable peak electricity demand from 326 kVA in 2013 to 0 kVa in 2014. This demand management activity will save EastLink over $26,000 in 2014. “With help from EnerNOC we were pleased to achieve 100% of our reduction targets on the critical peak demand days this past summer, eliminating the critical peak demand charges from our bills for a full year. This has contributed to savings in excess of 8% of our annual electricity costs at one facility,’ says Monson.
Monson was impressed with both EnerNOC and the service received at her facility: “EnerNOC has worked with EastLink to identify numerous opportunities for saving on our energy bills. From initial meetings to establishing the opportunities, installing the EnerNOC Site Server, training on the EnerNOC software, and notifying us of dispatches over the summer, support has always been available over the phone and via email.”
With annual energy rate increases, the benefits to EastLink through participating in Ausnet Services’ demand response program are expected to be even greater next year. EastLink is expected to earn even more savings, almost $35,000 in 2015 by reducing energy usage on critical peak demand days.
Location: Victoria, Australia
Key Challenge: Getting visibility into energy usage in order to reduce peak demand charges
Results: Energy costs down 8%