Power Prices Not So Tarrific News
Power tariffs have already changed for larger Queensland businesses. By 2017, every business in the state will come under this new tariff regime. ecoBiz coach Penny Prasad has the details.
Energy tariffs have changed. As of July this year, certain businesses have been paying ‘power factor’ charges (among other demand charges) on a new electricity tariff structure.
ecoBiz coach and ecoEfficiency Group director Penny Prasad said organisations using between 100 megawatt hours and 4 gigawatt hours per year are now paying demand charges by kilovolt-ampere (kVa) and not by kilowatt, as previously.
“Businesses using 100 megawatt-hours per year or more could be a small-scale factory, definitely a hospital and maybe a multi-level office building,” Penny says.
Why are the power companies doing this?
Essentially, although there is decreasing overall demand on the power supply, the peak or instantaneous demand has gone up.
At a very basic level, the new billing structure takes into account the strain sudden power demand places on infrastructure, not just sheer volume.
“It’s all about the capacity of the provider in your area to provide the peak amount at any one time,” Penny says.
How does that work?
Basically, across Queensland, more load is being added to the electricity supply system as more and more people use power from the grid and operate their equipment at the same time – especially air-conditioners.
Electricity suppliers are striving to cater to this instantaneous, or ‘peak’, demand.
What can I do?
Penny recommends you check your bills to see if you already have demand and power factor related charges.
“It may be worthwhile installing energy monitoring and management software and power factor correction equipment,” she says.
The former will track usage and demand peaks while the latter will give optimal power factor and help reduce electricity costs.
My power use is nowhere near 100MWh/yr. Should I care?
Yes. This is just the first stage of the tariff changes. Every business, regardless of their overall usage, will pay under this tariff by 2017.
Penny also notes that equipment efficiency and usage policies influence peak demand.
“It’s good to install energy-efficient equipment and look at the way you operate it to see if you can reduce the peak demand,” she says.
It can be as simple as having certain pieces of equipment working at different time to spread the load.
“There are some rebates available for installation of power factor equipment as well as peak-smart air-conditioning systems through Energex – its website has more information.”