• Business Development

Reducing the Cost of Energy Day and Night, Throughout the Year

Wind and solar are complementary for managing “peak-demand” costs.

Erik Haug
Business Development Manage

Many people think of “on-peak” energy hours as sweltering summer afternoons when air conditioners are blasting and people are returning home from work to cook dinner. But in certain places, on-peak also includes chilly winter nights and icy mornings when electric-powered heat strains the grid to keep homes and businesses warm in frigid temperatures.

In states like Tennessee and Virginia, especially in the winter, customers pay higher rates for on-peak, or “peak-demand,” hours. In part, this is because utilities must dispatch less efficient generators during peak-demand times to meet customers’ needs.

Earlier this winter, many utilities experienced price spikes firsthand as January’s arctic weather blanketed much of the United States. In the below-freezing temperatures, consumers used more gas to heat their homes and businesses, depleting the supply for utilities to burn in power plants. Electricity prices surged to their highest in years across several regions of the country.

The solution—perhaps unexpected to some—is wind power.

For power customers, the gusts of wind blowing through parkas after the sun sets provide a low-cost and clean solution to heating homes and businesses.

On average, wind produces more power at night than during the day, and seasonally it produces more during the winter months. Since wind has no marginal fuel cost, it reduces the overall burden on a utility company during on-peak times and can result in lower costs over the long term for ratepayers.

Top: Average hourly “back-cast” Volunteer Wind production compared to TVA energy demand throughout winter months. Bottom: Hourly “back-cast” Volunteer Wind production compared to TVA energy demand on January 6, 2016. Nighttime and early-morning wind from Volunteer correlates to increased energy consumption during the winter.

Top: Average hourly “back-cast” Volunteer Wind production compared to TVA energy demand throughout winter months. Bottom: Hourly “back-cast” Volunteer Wind production compared to TVA energy demand on January 6, 2016. Nighttime and early-morning wind from Volunteer correlates to increased energy consumption during the winter.

Click to enlarge.

Some commercial and industrial customers, such as manufacturers, operate their plants 24/7. In recent years, these C&I customers have become the largest purchasers of renewable energy. For them, the problem with looking to solar alone is that it only provides power during the day. For corporations that wish to reduce their overall energy spending, purchasing power from a wind project at a fixed price can mitigate on-peak costs.

A combination of renewable technologies adds diversity and resilience to the grid by making it less reliant on a single source of energy.

For an even more comprehensive approach to renewable energy procurement, progressive utilities and corporates are considering wind and solar to better match their energy consumption with purchased renewable generation. (Cue the meme “Why not both?”)

Because solar produces during the daytime, and for longer periods during the summer months, a hybrid wind and solar strategy for securing energy can provide customers with renewable energy around the clock. A combination of renewable technologies adds diversity and resilience to the grid by making it less reliant on a single source of energy.

Annual expected generation from Apex’s Volunteer Wind project in Gibson County, Tennessee, and an example solar profile. Note the complementary seasonality of production; wind generates more during the winter and “shoulder months” whereas solar generates more during the summer. Likewise, wind generates during the day and mostly at night whereas solar is only available during the day.

Annual expected generation from Apex’s Volunteer Wind project in Gibson County, Tennessee, and an example solar profile. Note the complementary seasonality of production; wind generates more during the winter and “shoulder months” whereas solar generates more during the summer. Likewise, wind generates during the day and mostly at night whereas solar is only available during the day.

Click to enlarge.

Apex Clean Energy recently provided a hybrid solution for Fort Hood, the largest active-duty armored U.S. military garrison in the world. Phantom Solar, located on-post, and Cotton Plains Wind, sited about 350 miles away, generate over 65 megawatts of clean energy and supply about half of Fort Hood’s current annual energy consumption. Together, the wind and solar projects deliver energy independence and, by the military’s estimate, will save taxpayers an estimated $168 million over the life of the project.

Apex’s industry-leading development pipeline enables us to partner with corporations and utilities to develop solutions that provide clean energy products for a customer’s needs, no matter how diverse or specific, and at all times of the day and year.

Erik Haug
Business Development Manager

Erik focuses on commercial negotiations and transactions with corporate and industrial customers seeking renewable energy. Previously, he worked as a senior petroleum geologist, exploration geologist, and commercial business intelligence adviser at ExxonMobil. Erik has a BS in geology with an environmental concentration from the College of William and Mary and an MS in geosciences from Virginia Tech.

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