Summer is a challenging time of year for any industrial electricity user with a contract that exposes them to peak demand events across the grid. But a new solution allows users to access the best rates the market has to offer – while still protecting against the surge pricing that can, in the worst of cases, put a business under.
The removal of approximately 750MW of baseload generation capacity in South Australia (and soon the removal of 1,800MW in Victoria) significantly reduces the options for companies to obtain alternate sources of electricity supply across southern states.
This reduction in base load is compounded by higher demand expected in the summer months. As a result, companies on pool price pass-through retail contracts or with direct wholesale market exposure face the real risk of high electricity costs from sudden increases in National Electricity Market (NEM) prices.
The price of wholesale electricity can vary from -$1,000 to $14,000 per megawatt hour (MWh), and over a year, the average price has been approximately $50 MWh in SA. On a pool price pass-through contract, if the wholesale price peaked at $14,000/MWh, costs could escalate rapidly.
For example, a 1MW load sustained for ten hours would cost $140,000. A 50MW load sustained for two hours would cost the company up to $1,400,000.
Using their expertise in the supply of backup and emergency generation from around the globe, Aggreko offers a diesel generator solution to provide an alternative power source to mitigate the effects of spikes in the spot price.
With a large range of generators at their disposal, Aggreko can supply loads of between 15kW to 250MW. The configuration of the generators is engineered to supply up to a maximum of 90 per cent of the load, with the remaining 10 per cent supplied by the grid.
Keeping 10 per cent of supply from the grid ensures that the grid’s power quality is maintained at the customer’s site.
Continuity of supply is guaranteed through seamless transition between supply from the grid and supply from the generators.
Aggreko engineers work in conjunction with the customer to examine the economic viability of a hybrid Aggreko/grid supply versus a total grid supply solution.
Factors such as peak demand, average demand, customer’s anticipated average cost of electricity, changes to internal customer network and the cost of generators are taken into account.
By modelling the cost/benefit analysis of various scenarios, a solution tailored to the customer’s needs is provided. The final solution will determine the wholesale price (known as the trigger price) at which generators are stopped and started to give the optimum cost saving to the customer.
All monitoring and controls are automated and executed remotely including setting of the trigger price.
Aggreko offers a lease arrangement which is offered under a commercial rental arrangement with considerable cost benefits.
With the rental agreement the customer does not have to buy and maintain the unit and has the option of returning it when it is no longer needed. Aggreko delivers, installs, starts/stops and proactively maintains the unit for the customer, with costs associated with routine maintenance included in the rental fee.
This partner content is brought to you by Aggreko. For more information, visit www.aggreko.com.au or call 1300 929 031 for more information.