Post: GridBeyond successfully forecasts every PJM Coincident Peak during Summer 2023 saving customers thousands of dollars

GridBeyond successfully forecasts every PJM Coincident Peak during Summer 2023 saving customers thousands of dollars

Harnessing precision: Our PJM 5CP Forecast Model’s pivotal role in energy cost reduction

Introduction to PJM 5CP program

The Five Coincident Peak (5CP) program affects over 65 million electricity consumers in the PJM territory, the single largest electricity market in the United States, yet it is shockingly underappreciated. Have you heard of the 5CP program before?

To ensure that costs of serving the electric grid are fairly allocated, customers in PJM are billed based on how much electricity they use during the five single-highest hours of demand during the Summer season. Businesses that can strategically lower their demand during 5CP events can drastically reduce their capacity charges for the following year. What’s the catch? We don’t know in advance which hours are the five peak hours.

Impact on PJM electricity users

These coincident peak events significantly impact electricity costs for consumers within the PJM region.

PJM looks at each customer in each of these Peak Load hours and calculates their demand to the total load requirements during those specific Peak Load hours, i.e. their Peak Load Contribution (PLC). This assigned Peak Load is then charged to the customer by their utility to compensate for the construction and maintenance of generation and transmission resources that support the highest interval of demand during the highest peak demand of electricity on the overall grid of the year.

Consequently, the ability to reduce electricity consumption during these 5 coincident peak hours is a crucial cost-saving strategy for commercial and industrial facilities. This reduction is reflected in the capacity charges levied over the next delivery year (June-May). A lower demand during 5CP hours translates to reduced capacity charges, and thus substantial savings.

The Imperative of accurate forecasting

At GridBeyond, we deliver the tools and guidance today’s organizations need to predict system peaks and  minimize capacity charges with minimal impact on operations by reducing false dispatches. By accurately pinpointing when organizations should ramp up or scale back their energy consumption, we not only delivery cost savings but also significantly decrease the occurrence of false dispatches – helping organizations operate more efficiently while minimizing disruption to the facilities commercial operations. Our comprehensive approach to energy management not only aids in cost reduction but also promotes a greener, more sustainable future.

To achieve this, our team of expert data scientists has developed models to accurately forecast coincident peak periods a day in advance. Our models are both precise, meaning that we catch every actual coincident peak period, ensuring that consumers are alerted to genuine opportunities for cost reduction. Moreover, they have good recall in forecasting, meaning, that consumers are not unnecessarily interrupting their business, thus maintaining operational integrity while achieving cost savings.

Based on these forecasts our control room will remotely alert your site of an impending coincident peak event and, with your permission, automatically reduce your site’s electricity consumption during each of the five 1-hour events. During the summer of 2023 GridBeyond identified all five of the coincident peaks out of seven total alerts. Using this service an average 5 MW industrial facility would have saved over $100,000 over the next year of operations!

Our PJM 5CP Forecast Model’s unmatched performance

Our PJM 5CP Forecast Model has demonstrated unparalleled accuracy during the summer of 2023.

Our model successfully predicted, day ahead, all five peaks out of a total of only seven called events. This superior performance enabled our clients to proactively adjust their consumption strategies, significantly lowering their demand during 5CP periods and thereby reducing their capacity charges for the next delivery year while also ensuring minimal disruption to their business.

Peak price management is just one way in which businesses across the USA can use their energy strategy for cost savings and revenue generation. At GridBeyond we provide a suite of tools to maximize profitability of your investments in the energy sector – from planning to optimization, powered by AI.

When it comes to distributed energy assets there are numerous markets on which to dispatch your power or demand response, but the revenues can be volatile. This means deciding which market to participate in, as well as the timing of any dispatch impacts your revenue.

GridBeyond’s platform harnesses the power of AI to revolutionize how distributed energy assets are monetized. Through intelligent, real-time energy design, forecasting, optimization, and control, and innovative funding options, you can unlock the full potential of your demand, energy storage and renewables portfolio as you accelerate the mission to end global dependence on fossil fuels.

To learn more about GridBeyond and what we can do for you contact us at service@gridbeyond.com, call us at (346) 352-2138 or book a call back.