Over 50% of the costs on electricity invoices are for industry charges that cover things like transport and distribution costs. These costs are known as non-commodity costs.
The energy market is complex and large users of electricity generally have meters that measure their electricity consumption on a half-hourly basis. How much they pay for their non-commodity costs is determined, in part, by their demand during 3 half-hours of highest demand on the electricity transmission system between November and February each year. These are known as ‘Triad’ periods.
By reducing their consumption over the Triad periods large users of electricity are able to reduce their electricity charges.
By using the Crown Commercial Service (CCS) agreements for half-hourly electricity and demand side response, customers receive notice of when these Triad periods may occur so they can take action to reduce their consumption or switch to standby generation.
This can lead to substantial savings in transmission charges and across the NHS potential savings of £1.5 million have been identified.
As part of the CCS half-hourly electricity agreement, EDF, the CCS appointed electricity supplier, provides a free Triad warning service. This allowed King’s College Hospital NHS Foundation Trust and its Private Finance Initiative (PFI) energy centre operator, Veolia, to take action to reduce consumption during the Triad periods and make significant savings on their electricity costs.
On notification of a Triad period, the trust uses their on-site generating capacity, via their Combined Heat and Power (CHP) units, to reduce their consumption from the national grid. They have also made arrangements with Veolia to schedule planned maintenance work on their CHPs to avoid Triad periods in order to maximise the benefits.
Cathal Griffin, the trust’s Energy & Environmental Manager and the team at King’s have been successful in reducing the trust’s electricity costs.
Knowing when the expected Triad periods are likely to be and being able to take action saved the trust over £116,000 during 2014/15 and the team expect to see similar, if not higher, savings in 2015/16 and beyond.
Cathal and the team are also proactively looking at other ways to maximise their energy savings potential via the CCS agreements, such as more energy demand shifting and capacity reviews.
The CCS energy team is committed to powering the public sector - helping our customers across central government, the NHS and the wider public sector save millions of pound each year. Our combined buying power and commercial innovation helps you get best value in buying gas, electricity and liquid fuels. We can also help you save even more by reducing your consumption and future proofing your buildings.
If you are already using the CCS half-hourly electricity agreement, find out how much your organisation could save by taking action on Triad periods and other energy saving initiatives by registering for your free personalised saving plan from EDF. Simply email firstname.lastname@example.org