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All About Energy

Lowering Your Energy Costs with 4CP

Incite Energy Feb 23, 2017 7:35:00 AM
Incite Energy
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Save Money JarWith summer right around the corner, it's time to start planning your energy strategy. During summer, there four coincidental peaks (4CP) that determine how much you pay in transmission costs on your energy bills in the following year. 

 

During the late afternoon, temperatures are at their highest (if it's not raining). Businesses and offices are still open and a lot people are just getting home, so the number of places using air conditioning goes up. This is when supply and demand really kicks in. As demand goes up and supply goes down, the delivery prices of electricity can skyrocket.

Understanding four coincidental peak events

During the summer, system operators (ERCOT) experience periods of peak demand and there's a huge strain on the grid.  During the 15-minute interval when energy load and demand are highest, we have a four coincidental peaks event. 

 

There's one event a month from June to September. The four events are then averaged to create a new value. This value is multiplied by the transmission cost recovery factor (TCRF) and then factored into your transmission charges. Meaning, that the more energy you use during these events, the higher your electricity bills are in the following year.

 

Lower your bill by staying informed

If you're able to, try to reduce or shift your energy use to avoid weekday afternoons and early evenings (especially in summer). By getting notifications, such as 4CP Alerts, you can get predictions for how likely it is to be a four coincidental peak day.

 

More importantly, at what time the peak is likely to occur. Even if you can't lower your energy use all afternoon, as long as you're able to lower it for the 15 minutes when most power across Texas is used, you can lower your transmission costs for the next year.

 

Annual Savings Example

 

Energy Usage

TCRF Monthly Charge   

Peak
Charges

Annual
Savings

2015 4CP

(not lowering your energy use)

500 kW

$3.75

$22,500

----- 

2015 4CPn 

(lowering your energy use)  

250 kW

$3.75

$11,250

  $11,250 saved!  

*Please note that the values provided are only example values, assumes a constant TCRF, and a 50% load reduction. 

 

Here's an example of how much you can save. Say in 2016, you were using 500 kW at the time events occurred. If you didn't lower your energy use on the peak days, you'd be charged $22,500 for 2017. But since you did lower your energy use to 250 kW, your peak charges for 2017 would be $11,250 instead, for a savings of $11,250!

 

 

Lower transmission costs on electricity bills with 4cp alerts 

  

Topics: Electricity Bills, Energy Cost, energy rates, 4CP