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How to avoid maximum demand penalties in your electricity bill

How to avoid maximum demand penalties in your electricity bill

Introduction

Due to the constant increase of the electricity price, all types of customers must find new formulas to reduce their electricity bill. To succeed in this, we are presenting our new power management system to control the maximum demand: MDC series (MDC 4 and MDC 20).

How to understand the electricity bill

It is necessary to understand the different terms which appear in an electricity bill to identify where we can act to reduce it. Of all the concepts, the most important ones are: Active energy term, reactive energy term and, in some countries, the maximum demand term, being this one last the subject of this article.

As described below, an optimal management of the contracted power allows us to:

  • Adjust the installation to the real demand by reducing the contracted power
  • Avoid maximum demand penalties due to a power excess
Spanish bill simulation
Spanish bill simulation

Active energy term
Consumption of active energy (kWh), applying different tariffs and rates

Maximum demand term or Maximum demand indicator (MDI)
Maximum demand register (kW or kVA). This is the maximum power value, usually the average of 15 minutes, reached during the billing period (this average time may vary depending on the country). Once the value is higher than the contracted power, the customer will pay a penalty on the electricity bill.

Reactive energy term
Consumption of reactive energy (kVArh), applying different tariffs and rates. Depending on the cosϕ value, the user will pay a penalty (this penalty is not applied in all countries)

Maximum demand calculation

The maximum demand value is the average from the instantaneous power (in kW or kVA) during a defined time interval, usually every 15 minutes (this time interval will depend on each country). There are different methods to calculate this parameter:

Fixed window (Block window)

This is the maximum demand calculation during a defined interval (usually every 15 minutes). Once the data is obtained, the value is stored and it makes a reset to start a new calculation for the next 15 minutes. This 4 registers will be measured every hour.

Sliding Window

This is the maximum demand calculation during a defined interval (usually every 15 minutes). Once the data is obtained, it will wait one minute to start a new 15 minutes calculation (this time may vary depending on the country). This means that every minute (this time can depends on the meter) it will record one maximum demand value from the last 15-minute period. This 60 registers will be measured every hour.

What can we do to avoid maximum demand penalties on the electricity bill?

To avoid penalties for maximum demand we must ensure that this value will never exceed contracted power.

Usually in electricity bills, the highest maximum demand value recorded by the meter is compared to the contracted power. Whenever this value is higher than the contracted power, there will be an economic penalty. Therefore, if during the billing month the power exceeds the one contracted, during a period of 15 minutes, the customer will pay a penalty, even if it exceeds only once a month (one month has approximately 2880 fifteen-minute periods).

For the particular case of Spain, depending on the maximum demand value, the penalty can involve a very significant bill increase, as described in the following graph:

Maximum demand term increase depending on the Contracted power exceeds (Spain- for tariffs 3.0 and 3.1)
Maximum demand term increase depending on the Contracted power exceeds (Spain- for tariffs 3.0 and 3.1)

As shown in the graph, if the maximum demand value exceeds 10 % of the contracted power, the user will pay a 20% increase on the maximum demand term. However if the maximum demand value exceeds 20 % of the contracted power, the user will pay a 50% increase on the maximum demand term.

How to control the Maximum Demand value?

As we have been advancing, the goal to control the maximum demand is to not exceed the limit of the contracted power. To archive this goal, we advise to install a system able to disconnect non critical loads, on different time periods, and also avoid connecting loads simultaneously to reduce the instantaneous power.

Non-critical loads are those that do not affect the main production process or that are not essential, such as:

  • Lighting
  • Compressors
  • Air-conditioning systems
  • Pumps
  • Fans and extractors
  • Packaging machines
  • Shredders
  • others

Which devices help us avoid maximum demand penalties?

The main objective of the new CIRCUTOR MDC series is to manage and control the maximum demand of an installation. To achieve this objective, the device connects and disconnects some loads (non-critical ones) to ensure that the maximum demand will never be higher than the contracted power, avoiding electricity bill surprises. Moreover, the extended MDC 20 range, allows a tariff control to adjust the loads for being connected on periods with lower price, avoiding high consumptions due to loads simultaneity during high tariff price periods.

MDC 4
MDC 4 device
MDC 20
MDC 20 device

Small and medium-sized industries solution

MDC 4: Analyzer to control the maximum demand level

MDC 4 is perfect for those installations which need a basic maximum demand control. Following some easy configuration steps the user will define up to 4 maximum power levels to start disconnecting non-critical loads.

Furthermore, MDC 4 incorporates an internal power analyzer for the maximum demand calculation (it also records electrical parameters such as voltage, current and power). Every time MDC 4 detects a power excess, this will disconnect several lines with non-critical loads, reducing automatically the instantaneous power. This will ensure that the installation will not exceed the maximum demand limit, hence avoiding penalties on the next electricity bill.

Operation method of MDC 4

Operation method of MDC 4

MDC 4
MDC 4
  • Avoids maximum demand penalties
  • Avoids power peaks due to simultaneity while connecting loads
  • Helps to adjust the contracted power to the real situation
  • Manages up to 4 relay outputs
  • Built in power analyzer
  • Internal clock for power synchronization

Infrastructures and big-sized industries solution

MDC 20: Data logger to manage and control the maximum demand with integrated web server 

MDC 20 is a data logger with an integrated web server meant to manage and control the maximum demand. Its versatility allows the user to do basic or advanced configurations. MDC 20 manages non-critical loads to ensure that the maximum demand value will never exceed the contracted power, avoiding penalties for power excess.

MDC 20 has an Ethernet port and a RS-485 communication channel (Modbus RTU), 6 relay outputs for load management and 8 digital inputs for collecting pulses (from other meters) or for logical states (opened-closed). It is expandable up to 48 relay outputs and 48 digital inputs by connecting 12 LM 4I/O devices via RS-485 communications (with 4 inputs/outputs each one).

The device has an internal data base (more than one year of data) with an integrated web server with PowerStudio software for programming, configuring and monitoring the device status and the associated peripheral devices connected by RS-485. Furthermore, it graphically shows the simulation of the system behavior according to the programmed settings.

MDC 20 infrastructure

MDC 20 infrastructure

MDC 20
MDC 20
  • Avoids maximum demand penalties
  • Manages 6 relay outputs and 8 digital inputs
  • Expandable up to 48 inputs/outputs by RS-485 communications (installing LM 4 I/O devices)
  • Connection/disconnection of loads according to programmed priority
  • Versatile maximum demand control depending on conditions, using calendars, profiles, etc.
  • Simulation of system performance according to the device’s programming
  • Sends e-mails with customized messages
  • Stores more than one year of data
  • Compatible with any XML communication master
  • Creates and registers customized variables defined by the user (EnPI, %, Kg, CO2, Euros, …)

Click here to obtain more information about MDC 4 and MDC 20

New MDC series to manage and control the maximum demand

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Contact

CIRCUTOR, SA
Vial Sant Jordi s/n, 08232
Viladecavalls (Barcelona) Spain
Tel: (+34) 93 745 29 00
Fax (+34) 93 745 29 14

Technical Support

(+34) 93 745 29 19

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