Operation Peakload

Press, 28 May 1981, Page 16

Operation Peakload

l As winter draws in, the Municipal Electricity Department is again appealing to its consumers to co-operate in a scheme to help keep down the peak demand for electricity on those wintry evenings when fit usually soars. The co-operation called for is a few simple steps which most consumers could take in the crucial two or three hours of a few evenings' without great inconvenience or discomfort. Many of the hints, incidentally, put savings directly into the pockets of consumers. Although they are intended to moderate the peak demand for the whole M.E.D. system, they are likely to reduce the individual consumer’s over-all consumption of power.

Ripple control of water heating and an effort by consumers can reduce significantly the amount the M.E.D. must pay to the Electricity Division for supplies of bulk power, a saving which the M.E.D. will be able to pass on to the consumers themselves. The “demand charge” part of the Electricity Division's bulk power tariff is based on an average of the six highest half-hour demands that each authority makes on the country's electricity system. The lower that these six highest peak demands are. the lower the supply authorities’ payments to the division will be.

Christchurch consumers enjoyed the benefit of their co-operation with earlier peakload operations in 1980, when the M.E.D. was able to absorb that year’s 6 per cent increase in the bulk supply tariff without increasing its own tariffs. The steady price was maintained in part because lower peak loads had helped to keep down the actual amount paid for the bulk supply. This year, the M.E.D.’s tariffs had to be increased by a little more than the increase in the bulk charges, but not by the full 6 per cent that M.E.D. consumers escaped the year before. Given the cooperation of consumers in this year's Operation Peakload, there is a good chance that the full percentage of the next increase in the bulk supply tariff will not have to be passed on to consumers.

Christchurch and other South Island consumers have a special reason to cooperate with the effort to keep the peak loads low; it is a reason that is not shared by all North Island consumers. In many North Island areas natural gas is available. The peaks of the supply authorities in those areas tend to be lower because gas can be

, used for space heating, the demand for i which comes in peaks coinciding with cold > weather. The availability of gas means that ' some North Island supply authorities pay ; an average unit charge for electricity to | the Electricity Division that is lower than « the average. unit charge paid by the * Christchurch M.E.D. and by other South t Island supply authorities. In areas where ! the demand for heating is heavier — that is, in the colder south — and where the alternative heating fuel, natural gas, is not available, the supply authority peaks tend to be higher; .so does the demand charge portion of the bulk supply rate. To add salt to this wound, excess peak demand in the North Island may have to be met at greater cost because thermal generating plants have to be used more; the added cost is shared out among all consumers in i the end. I Such inequities between North and 5 South are not grounds for abandoning the . use of prices to keep peak loads as low as * possible. The Electricity Division imposes J a high tariff on peak demand because its own capital costs are higher if, to meet the occasional peaks, it has to install extra generating capacity which sits idle most of the time. Giving the supply authorities, and b through them the consumers, a financial ' incentive to moderate peak loads is preferable to having the division use other ways of keeping peak demand within the limits of the country’s generating capacity (and in dry years within the limits of water in storage for hydro stations). The division i could simply inform supply authorities i when the limits are being approached and | require them to cut supply to consumers through such means as more stringent ■ ripple control or by selective power cuts. I Voluntary co-operation through such f means as Operation Peakload, spurred on 'J by the prospect of financial benefits in the t form of lower individual power bills, is an approach that is much to be preferred. The occasional annoyance of having tepid . water' running from the hot tap or the J inconvenience of having to rearrange domestic routine on a few critical evenings seems worth enduring for clear financial benefits. The immediate savings in power . bills and the longer-term savings, through s avoiding the need for investment in » additional peak-load generating capacity, I will be significant if all consumers co- ? operate.