Increasing Peak Costs Are Driving Utilities Toward Innovative Programs; 2015 Summer Peak Is Cost Driver in NEMA/Boston


Peak load costs are set to rise by many millions of dollars for most New England municipal utilities. The forward capacity price increases are set to have a significant impact upon municipal utility customers and could increase retail rates by over 20% at many utilities. In NEMA/Boston, these cost increases will be set based on this summer’s (2015) peak load. With many millions of rate payer dollars at stake, some utilities are expanding their peak load management programs significantly.

Any program or technology that can reduce peak load demand will have an outsized cost savings over the next few years. Research conducted by Sagewell shows that there are a number of steps that utilities could be taking now to significantly reduce their future costs. For example, meter data analytics and targeted outreach can be used to focus on the biggest opportunities for peak cost reductions. In addition, by identifying specific technologies and customer behaviors, companies are able to reduce their utility customers’ overall energy and carbon use while increasing the bottom line for the utilities. These bottom line benefits can be used to offset peak load costs, or to reduce possible rate increases.

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