Todd Woody - The Atlantic.... To avoid these so-called demand charges—which can account for half of a monthly power bill—businesses can participate in programs that cut their bills if they allow their local utility take control of their air conditioners or lighting to reduce electricity use when the grid is overloaded.
Letting hotel guests who pay $300 a night sweat, however, is not an option. So Hobbs has pulled the plug on his utility by storing electricity in lithium-ion battery packs when rates are low for use when demand and prices rise. The battery and sophisticated software was built by a Silicon Valley startup called Stem and is another example of how technological innovation is upending utilities' century-old stranglehold on power.
"We measure a business' electricity usage and predict when there will be spikes in usage and make decisions on whether to charge or discharge batteries," says Prakesh Patel, Stem's vice president of capital markets and strategy, who notes that demand charges have risen 30 percent in the San Francisco Bay Area over the past three years.
That means Stem's algorithms are constantly analyzing a customer's power demand as well as other factors, such as weather patterns and past energy use, and then charging and discharging the batteries in tiny increments. Such fine-tuning keeps a customer's utility bills down while minimizing wear and tear on the expensive lithium ion battery packs, which are similar to those found in electric cars.
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