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<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'>Esteemed wrenches,<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'>I have been wrestling with this concept
about as long as we have been in business. How to estimate how much a <span
class=SpellE><span class=GramE>pv</span></span> system will reduce the demand
charge for a customer.<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'>I know the “worst case” goes as
follows: <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<p class=MsoNormal style='margin-left:.5in;text-indent:-.25in;mso-list:l3 level1 lfo5;
tab-stops:list .5in'><![if !supportLists]><font size=2 color=navy face=Arial><span
style='font-size:10.0pt;font-family:Arial;mso-fareast-font-family:Arial;
color:navy'><span style='mso-list:Ignore'>(1)<font size=1 face="Times New Roman"><span
style='font:7.0pt "Times New Roman"'> </span></font></span></span></font><![endif]><font
size=2 color=navy face=Arial><span style='font-size:10.0pt;font-family:Arial;
color:navy'>Demand is based on measuring the consumption every 15 minutes and
keeping track of those numbers for the entire billing period.<o:p></o:p></span></font></p>
<p class=MsoNormal style='margin-left:.5in;text-indent:-.25in;mso-list:l3 level1 lfo5;
tab-stops:list .5in'><![if !supportLists]><font size=2 color=navy face=Arial><span
style='font-size:10.0pt;font-family:Arial;mso-fareast-font-family:Arial;
color:navy'><span style='mso-list:Ignore'>(2)<font size=1 face="Times New Roman"><span
style='font:7.0pt "Times New Roman"'> </span></font></span></span></font><![endif]><font
size=2 color=navy face=Arial><span style='font-size:10.0pt;font-family:Arial;
color:navy'>The customer gets socked with a demand charge that is based on the
highest 15 minute consumption for the entire billing period.<o:p></o:p></span></font></p>
<p class=MsoNormal style='margin-left:.5in;text-indent:-.25in;mso-list:l3 level1 lfo5;
tab-stops:list .5in'><![if !supportLists]><font size=2 color=navy face=Arial><span
style='font-size:10.0pt;font-family:Arial;mso-fareast-font-family:Arial;
color:navy'><span style='mso-list:Ignore'>(3)<font size=1 face="Times New Roman"><span
style='font:7.0pt "Times New Roman"'> </span></font></span></span></font><![endif]><font
size=2 color=navy face=Arial><span style='font-size:10.0pt;font-family:Arial;
color:navy'>The customer also gets soaked with a “facilities charge”
that is equal to the greatest monthly demand number for the trailing 12 months.<o:p></o:p></span></font></p>
<p class=MsoNormal style='margin-left:.5in;text-indent:-.25in;mso-list:l3 level1 lfo5;
tab-stops:list .5in'><![if !supportLists]><font size=2 color=navy face=Arial><span
style='font-size:10.0pt;font-family:Arial;mso-fareast-font-family:Arial;
color:navy'><span style='mso-list:Ignore'>(4)<font size=1 face="Times New Roman"><span
style='font:7.0pt "Times New Roman"'> </span></font></span></span></font><![endif]><font
size=2 color=navy face=Arial><span style='font-size:10.0pt;font-family:Arial;
color:navy'>Now you have a solar system pumping out <span class=SpellE>Wac</span>
varying over the familiar bell-shaped curve during the day.<o:p></o:p></span></font></p>
<p class=MsoNormal style='margin-left:.5in;text-indent:-.25in;mso-list:l3 level1 lfo5;
tab-stops:list .5in'><![if !supportLists]><font size=2 color=navy face=Arial><span
style='font-size:10.0pt;font-family:Arial;mso-fareast-font-family:Arial;
color:navy'><span style='mso-list:Ignore'>(5)<font size=1 face="Times New Roman"><span
style='font:7.0pt "Times New Roman"'> </span></font></span></span></font><![endif]><font
size=2 color=navy face=Arial><span style='font-size:10.0pt;font-family:Arial;
color:navy'>In the southwest US, peak demand typically occurs early in the afternoon
in the summer, during the week. Our LADWP has a mantra that goes something like
this, “Peak demand occurs at 3pm PDT on the third Thursday in August!”
I believe them.<o:p></o:p></span></font></p>
<p class=MsoNormal style='margin-left:.5in;text-indent:-.25in;mso-list:l3 level1 lfo5;
tab-stops:list .5in'><![if !supportLists]><font size=2 color=navy face=Arial><span
style='font-size:10.0pt;font-family:Arial;mso-fareast-font-family:Arial;
color:navy'><span style='mso-list:Ignore'>(6)<font size=1 face="Times New Roman"><span
style='font:7.0pt "Times New Roman"'> </span></font></span></span></font><![endif]><font
size=2 color=navy face=Arial><span style='font-size:10.0pt;font-family:Arial;
color:navy'>So one would expect something like 40% of the peak <span
class=SpellE>Wac</span> to offset the peak demand, but what happened if the sun
goes behind a cloud for those 15 minutes? Answer, “Bad luck. Your demand is
back to what it was before you bought your solar system.<o:p></o:p></span></font></p>
<p class=MsoNormal style='margin-left:.5in;text-indent:-.25in;mso-list:l3 level1 lfo5;
tab-stops:list .5in'><![if !supportLists]><font size=2 color=navy face=Arial><span
style='font-size:10.0pt;font-family:Arial;mso-fareast-font-family:Arial;
color:navy'><span style='mso-list:Ignore'>(7)<font size=1 face="Times New Roman"><span
style='font:7.0pt "Times New Roman"'> </span></font></span></span></font><![endif]><font
size=2 color=navy face=Arial><span style='font-size:10.0pt;font-family:Arial;
color:navy'>It is actually worse than that. Peak demand recurs with
approximately with the same value with some regularity for an extended period
of time, so the sun will have to shine with full intensity every day when peak
demand is expected to occur, which in LA could be every day (M-F) of the 30 day
billing period.<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'>I have always taken the position that we
can’t guarantee that any of the demand charge will be reduced with a
solar system. But what do other PV integrators tell there customers? Better yet
is there any actual data on demand reduction with PV systems? It seems to me
that occasionally the monthly peak demand will in fact be shaved by PV <span
class=GramE>production,</span> the question is how often in practice?<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'>I once thought of taking actual insolation
data and comparing it with actual demand data and doing a <st1:place w:st="on">Monte
Carlo</st1:place> simulation (throwing the dice = randomly matching up demand
data with solar production data) – but I haven’t retired yet.<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<div>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy;mso-no-proof:yes'><!--[if gte vml 1]><v:shape
id="_x0000_s1026" style='position:absolute;margin-left:0;margin-top:0;width:50pt;
height:50pt;z-index:1;visibility:hidden' coordsize="21600,21600" o:spt="100"
o:preferrelative="t" adj="0,,0" path="" filled="f">
<v:stroke joinstyle="miter" />
<v:formulas/>
<v:path o:extrusionok="f" gradientshapeok="t" o:connecttype="rect" />
<o:lock v:ext="edit" aspectratio="t" selection="t" />
</v:shape><![endif]-->I would love to hear what others are doing about this.<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy;mso-no-proof:yes'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy;mso-no-proof:yes'>- Peter<o:p></o:p></span></font></p>
<p><font size=2 color=navy face=Arial><span style='font-size:10.0pt;mso-no-proof:
yes'>Peter T. Parrish, Ph.D., President<br>
<st1:State w:st="on"><st1:place w:st="on">California</st1:place></st1:State>
Solar Engineering, Inc.<br>
<st1:address w:st="on"><st1:Street w:st="on">820 Cynthia Ave.</st1:Street>, <st1:City
w:st="on">Los Angeles</st1:City>, <st1:State w:st="on">CA</st1:State> <st1:PostalCode
w:st="on">90065</st1:PostalCode></st1:address><br>
CA Lic. 854779, NABCEP Cert. 031806-26<br>
<a href="mailto:peter.parrish@calsolareng.com"><span style='mso-bidi-font-family:
Arial'>peter.parrish@calsolareng.com</span></a><span
style='mso-spacerun:yes'> </span><br>
Ph 323-258-8883, <st1:City w:st="on"><st1:place w:st="on">Mobile</st1:place></st1:City>
323-839-6108, Fax 323-258-8885<span
style='mso-spacerun:yes'>
</span><o:p></o:p></span></font></p>
<p><font size=2 color=navy face=Arial><span style='font-size:10.0pt;mso-bidi-font-family:
Arial;mso-no-proof:yes'> </span></font><font color=black><span
style='mso-bidi-font-family:Arial;color:windowtext'><o:p></o:p></span></font></p>
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