Peak Shaving

Peak shaving refers to the targeted reduction of load peaks in a manufacturing company's electricity consumption. The goal is to limit the maximum power demand—measured in kilowatts (kW) or megawatts (MW) over a defined interval—because this peak directly impacts the electricity bill. Load management is one of the most cost-effective energy measures in production: it lowers costs without reducing output, changing core processes, or requiring massive investment.

Why Peak Loads are Expensive: The Demand Charge

Industrial customers typically pay two price components: an energy charge per kilowatt-hour (kWh) consumed and a demand charge per kilowatt of maximum power drawn during the billing period.

The demand charge is based on the annual peak load—the highest measured 15-minute average power demand in the entire calendar year. This single peak value determines the demand charge component for the entire following year. A company that draws 2 MW more power than usual for just 15 minutes on one single day will pay an increased demand charge for the next twelve months.

This creates an asymmetrical cost situation: a single uncontrolled peak—caused by starting several large machines simultaneously after a break, heating up industrial furnaces, or an unplanned production start—can cause annual additional costs in the tens of thousands of euros.

How Peak Loads Occur in Production

Peaks are caused by the uncoordinated, simultaneous activation of large consumers. Common causes include:

• Simultaneous Start-up After Breaks: When all machines start at once after a shift change or weekend, start-up currents aggregate into a massive peak.
• Heating and Warm-up Processes: Industrial furnaces, heat presses, and injection molding machines draw significantly more power during warm-up than in steady-state operation.
• Compressor Starts: Compressed air compressors have high starting currents that can trigger peaks if uncoordinated.
• Unplanned Restarts: After a system failure, restarting multiple machines at once creates an uncontrolled peak.

Methods of Peak Shaving

Load management utilizes three primary approaches:

1. Load Shifting (Time-staggered Activation): The simplest approach. Instead of starting all machines at once, start-up times are staggered by several minutes. This requires no technical investment, only organizational discipline.
2. Load Shedding: If the 15-minute power demand threatens to exceed a threshold, non-critical consumers (e.g., HVAC systems, lighting in warehouses, or charging stations) are automatically or manually switched off.
3. On-site Generation and Storage: Battery storage, combined heat and power (CHP) plants, or PV systems can bridge high-load moments by feeding energy into the internal grid during peaks.

The Necessity of Real-Time Machine Data

Peak shaving without real-time transparency is like flying blind. You cannot intervene preventively if you don't know your current instantaneous power demand or how it will evolve in the next few minutes.

An MES (Manufacturing Execution System) that records machine consumption in real-time and links it to order data provides two critical advantages:

• Transparency of Idle Consumption: Identifying machines that are running but not producing (generating base load without value).
• Pattern Recognition: If the same peak occurs every Monday at 6:00 AM, it is a structural problem solvable via staggered start-ups—but this is only visible if data is historized.

Energy Grid Reform and Flexibility

Grid regulators are increasingly discussing flexible grid fees to incentivize industrial customers to provide load flexibility (Demand Response). For companies already monitoring their consumption in real-time, the transition to controllable loads is much easier, turning energy transparency into a future-proof competitive advantage.

FAQ

How is the annual peak measured? It is the highest 15-minute average value of active power within a calendar year. Short spikes lasting only a few seconds typically do not impact the average significantly.

What is the cost of one kilowatt of peak demand? In Germany, demand charges for medium-voltage industrial customers typically range between €50 and €150 per kW/year. A 2 MW peak at €80/kW results in a €160,000 annual charge, regardless of actual kWh consumption.

Can peak shaving be implemented without external providers? Yes. Staggered start-up sequences require only organizational discipline and clear operating instructions. Automated load shedding requires measurement hardware but is relatively easy to retrofit.

What is the ROI? For organizational and software-based measures, the ROI is often between 6 and 18 months. Storage solutions typically have a longer payback period of 4 to 8 years, depending on battery costs and peak height.