Electricity Demand Pricing

[ajm]

Has anybody had to pay the extra demand price in the residential power bill? Have just done a crash course in WTF-is-this? when looking for a new retailer.

Current retailer asked to install a smart meter two years ago spouting about how much easier it would make reading the meter. We were tired of their over estimations due to farm dogs being out. Sounded like a good idea.

What they didn't tell us was that it meant we were shifted to a new tariff. Hasn't been an issue yet.

In a nutshell, between 4pm and 9pm, electricity will be charged at a premium if you exceed a certain level of consumption. The best part is, if you go over that level by 1 zap, you will have to pay the entire month at the higher demand price. That sounds completely fair. NOT.

Now, nobody can tell me what the level is that triggers the demand pricing. Not the retailer. Not energex. Yet, they can put it on my bill.

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[tom60]

AJM,
My understand of demand pricing is the user is always going to pay a higher price for electricity during the "demand pricing" period.  The additional cost is based upon how great the usage was during the demand period.  The user can reduce the cost during the demand pricing period by reducing the peak amount of electricity used during the period. 

Effectively, users on a demand pricing tarrif get rewarded with a lower unit price during the non demand recording period and can also reduce their demand price by reducing their peak demand during the demand period (ie, move their electricity requirement to the non demand period of the day). 

The overall objective is to flatten the demand curve which makes it easier to generate electricity. 

[yvesjv]

The best way to avoid this is to go solar + batteries, wind or hydro on your property.
Check the 'preppers' sites... they always upgrading their kits in readiness for the soon to come apocalypse of civilisation.
Quite crazy at times they are but some of their ideas are quite good.

[ajm]

Thanks Tom, I understand the concept but not the mechanics of demand pricing. Some articles says that your highest peak of demand within a month sets your demand tariff for every single day within the month. So, all your power is billed at the demand price. Other articles suggest that if the highest peak demand exceeds a certain threshold, you then get charged the demand tariff. Problem I am having is being told what is definitely going to happen. Which method will they use?

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[ajm]

The best way to avoid this is to go solar + batteries, wind or hydro on your property.
Check the 'preppers' sites... they always upgrading their kits in readiness for the soon to come apocalypse of civilisation.
Quite crazy at times they are but some of their ideas are quite good.

Collating quotes today actually.

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[tom60]

Thanks Tom, I understand the concept but not the mechanics of demand pricing. Some articles says that your highest peak of demand within a month sets your demand tariff for every single day within the month. So, all your power is billed at the demand price. Other articles suggest that if the highest peak demand exceeds a certain threshold, you then get charged the demand tariff. Problem I am having is being told what is definitely going to happen. Which method will they use?

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I suspect it depends upon your provider.  I think AGL calculate the highest peak as the maximum power consumed over a 30 minute period during a 30 day period.  ie:  The period (day) where you have the greatest usage during the 30 days becomes the figure used in the calculation for the month.  Other providers may calculate it differently.

[ajm]

You have it. The highest half hour peak consumption is used. Take the kWh used, multiply by 2, times by the demand price, then times by the number of days in the month. Found out finally today from energy Australia. If the highest use is 4 kwhs, this will add approximately $50 to the monthly bill. There is no threshold. They deem all consumption between 4pm and 9pm excessive.  users with smart meters are to be billed the demand price on top of the standard daily supply and usage rates. Folks with dial meters are not charged the demand price. Definitely not fair and equitable.

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[WAI4WD]

Glad ours is much simpler. We have two prices, one low for x kwh and when reached, it increases a couple cents every kwh after that. Strata bulk service pricing, cheaper than anything we could get if we changed our meter to a NMI.

[ajm]

Ours was an old black dial meter. Single rate tariff.  Retailer changed it to a smart meter as a solution to not being able to get into the property when the dogs were out. Didn't tell us about the planned change to pricing.

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[WAI4WD]

Didn't tell us about the planned change to pricing.

They never do, cheeky buggers.

[yvesjv]

I think you are now locked to them.
If you change providers, they may not have access to that smart meter.

[JS]

Be surprised if having a smart meter locked you in to anybody. I'd be pretty sure that consumers can change when and where they want.
Finding the best deal is the hassle, and then , like insurance companies, the next year everything changes again.

Cheers
Jim

[tom60]

ajm it appears that if you want to achieve the lwest possible monthly bill on the existing tarriff you need to ensure the electricity consumption during the demand period doesn't exceed that of the non demand period.  You need to consider what load can be moved from the peak period to the low period.  Appliances like washing machines, dishwashers, oven, kettle, etc.  Reserve the peak period for TV, computer, lights, etc.

I have an energy consumption and production monitor fitted to our house and can see the consumption spike when SHMBO puts on the kettle for a cuppa in the morning and evening.  The kettle uses 2000W! 

[WAI4WD]

In simple terms: the industry is pushing every home owner to have a roof full of solar and battery storage.

[ajm]

ajm it appears that if you want to achieve the lwest possible monthly bill on the existing tarriff you need to ensure the electricity consumption during the demand period doesn't exceed that of the non demand period.  You need to consider what load can be moved from the peak period to the low period.  Appliances like washing machines, dishwashers, oven, kettle, etc.  Reserve the peak period for TV, computer, lights, etc.

I have an energy consumption and production monitor fitted to our house and can see the consumption spike when SHMBO puts on the kettle for a cuppa in the morning and evening.  The kettle uses 2000W!

From the calculation provided by energy Australia, ANY consumption in the 4pm to 9pm slot, M - F, is used in the calculation of the new demand charge. They use the half hour with the highest amount of electricity used as the base line for your monthly demand charge.

 The only way to avoid it is to turn everything off and sit in the dark. That tells me it's as much about revenue as it is about shifting the actual demand profile. If it was just the excess demand that would be charged, there would be a threshold allowing for normal/average consumption. The demand price would then catch out those switching on the air con and all the lights.

Where did your energy monitor device come from?


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