What Is Peak Shaving and How Does It Cut Electricity Costs?

3 min read
Smart ChargingCapacity Planning
Two GivEnergy commercial battery storage cabinets installed in a plant room at a UK commercial building.

TL;DR

Peak shaving is using a battery to avoid buying grid power during the most expensive half hours of the day. The battery charges when power is cheap, then discharges when your site demand spikes. Your meter never sees the full peak. That cuts two costs at once: the pricey peak unit rate, and the demand charge based on your highest half hour.

Get in touch with our team and we will talk you through your options.

Before the detail, one link worth having. See what a system costs on the commercial battery storage cost page.

How business electricity is priced

A home pays one unit rate. A business bill is built from several parts, and the expensive ones cluster in the busy hours.

Think of your usage across a day as a line on a graph. Quiet periods sit low. When machinery, heating, cooling and chargers all run together, the line spikes. Those spikes are where the money goes.

Three charges make peaks costly. The peak unit rate is higher than the off peak rate. Network charges, known as red band charges, load extra cost onto weekday late afternoons. And a demand charge is set by your single highest half hour, which can raise your bill for months from one bad spike.

Charge on the billWhen it bitesPeak shaving effect
Peak unit rateWeekday afternoons and early eveningsRun on stored power, buy fewer peak units
Red band network chargeTypically 16:00 to 19:00 on winter weekdaysDischarge across the window, cut red band import
Demand charge (per kVA)Set by your highest half hourCap grid import, hold your peak lower

Indicative UK figures show peak rates around 30p to 45p a unit against off peak nearer 15p to 22p. That gap is what makes the maths work.

How the battery cuts the cost

The battery and its controls do the work automatically.

It charges overnight on cheap rates, or from rooftop solar that would otherwise export at midday for pennies. The control system then watches your site load in real time. When demand climbs toward your limit, the battery discharges to fill the gap. Your grid import stays capped, even when the site itself is drawing more.

Two savings follow. You buy fewer units at the peak rate and more at the cheap rate. And your recorded peak demand stays lower, which trims the per kVA charge and can let you agree a lower capacity with your supplier.

For sites with sharp, predictable peaks, that can move a meaningful share of the bill. The exact figure depends on your load shape and tariff, which is why we model it before we quote.

Is peak shaving right for your site?

Peak shaving pays best where the working day sits inside peak hours and demand spikes hard. Manufacturing, cold storage, workshops and busy offices are strong fits.

We evaluate your half hourly data first, so the saving is based on your real usage rather than a rule of thumb. If you already have solar or charge EVs on site, a battery ties all three together on one platform and shields you from the worst of the peak tariff. Grid applications and export limits are our day to day work, and we handle the G99 application with the network operator as part of every battery storage installation.

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We model peak shaving against your actual half hourly usage, so the numbers are real before you commit. Want to See What You Could Save?

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