Grid Peak Shaving Savings Calculator

Work out grid peak shaving savings instantly with clear inputs, formula shown and shareable results.

About Grid Peak Shaving Savings Calculator

Peak shaving reduces the billed maximum demand by discharging storage or curtailing load during the site's peak. Saving is the kilowatt reduction times the demand charge times twelve months. Because the charge applies to the single highest interval, even a short well-timed discharge captures the full saving.

Formulas

Peak shaving saving

Annual saving = (peak demand - shaved demand) x demand charge x 12

Payback

Payback years = system cost / annual saving

Worked example

With the default values below, Grid Peak Shaving Savings Calculator returns Annual Demand Charge Saving of $2,160,000.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Current Peak Demandminimum 0 kW: 2,400 kW
Demand After Shavingminimum 0 kW: 2,000 kW
Demand Chargeminimum 0 per kW per month: 450 per kW per month
Storage System Costminimum 0: 18,000,000

Results

Annual Demand Charge Saving: $2,160,000.00
Peak Demand Reduction: 400.00
Monthly Saving: $180,000.00
Simple Payback: 8.33

Step by step

1Values used
2Peak shaving saving
3Payback
4Annual Demand Charge Saving= 2,160,000.00
5Peak Demand Reduction= 400.00
6Monthly Saving= 180,000.00
7Simple Payback= 8.33

Assumptions and limits

The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation, tax or compounding frequency into account.
Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

What makes peak shaving difficult?

Predicting the peak. Missing one interval in a billing period forfeits the whole month's saving, so control must be forecast-driven with conservative thresholds.

Is a ratchet clause a risk?

Yes. Where the billed demand is the highest of the last twelve months, a single missed peak locks in a high charge for a year, which greatly raises the value of reliable control.