If your organization participates in the Industrial Conservation Initiative (ICI), your Global Adjustment (GA) charge will be calculated based on your average electricity demand during Ontario’s five highest peak periods over a 12-month period. Businesses that fall under this category are referred to as Class A Customers.
What is the Global Adjustment (GA)?
The Global Adjustment (GA) is a key component of Ontario’s energy pricing system. Its purpose is to ensure the province maintains a reliable energy supply by funding energy infrastructure and conservation initiatives. Essentially, the GA supports the costs required to ensure sufficient electricity is available when needed.
Reducing the Global Adjustment (GA) Charge with Solar Power
Because the GA charge is determined by a company’s energy demand during Ontario’s five highest peak periods, leveraging solar energy can reduce this cost significantly. Generating solar energy during these critical peak times minimizes demand from the grid, thereby lowering the GA charge.
However, there is no guarantee of sunny conditions during peak periods. To maximize savings, businesses can consider incorporating battery storage systems into their solar solutions. Stored solar energy can be deployed during peak times, ensuring your company benefits even if sunlight is unavailable. The more effectively a business can rely on solar energy during peak periods, the greater the reduction in GA costs. Here’s why:
1. Solar Energy Reduces Reliance on the Grid During Peak Times
One of the most effective ways to lower GA costs is by reducing electricity drawn from the grid during peak demand periods. Solar power systems generate electricity onsite, which allows businesses to meet a portion—or even all—of their energy needs without pulling power from the grid. This decrease in grid reliance translates directly into lower GA charges.
- Peak Demand and Solar Alignment: Peak demand periods in Ontario often occur on hot, sunny afternoons, typically in the summer months, when air conditioning use is at its peak. These are the same conditions in which solar panels operate at maximum efficiency, producing the highest amounts of electricity. This natural alignment means that businesses with solar installations are well-positioned to offset grid consumption during critical peak periods.
2. Solar Energy Provides Predictable Cost Savings
The GA charge is calculated based on a company’s average demand during the five peak periods. By using solar energy to offset electricity usage during these peaks, businesses can predictably lower their exposure to the GA charge. Over time, even modest reductions in grid demand during these critical hours can lead to substantial savings.
3. Solar Energy Reduces Carbon-Intensive Peak Demand Contributions
During peak demand periods, the grid often relies on additional power generation from peaker plants, which are expensive and carbon-intensive facilities designed to provide electricity during high-demand times. Businesses drawing energy from the grid during these peaks are not only incurring high GA costs but also contributing to the need for these costly backup systems.
By generating solar power onsite, businesses reduce their reliance on the grid and, in turn, their contribution to peak demand. This benefits both the company’s bottom line and the overall energy system by decreasing reliance on expensive, high-emission energy sources during critical periods and helps the organization contribute to a cleaner energy economy by using their self-generated sustainable clean energy in lieu of polluted energy from the grid.
4. Battery Storage Enhances Solar’s Impact
While solar energy on its own is highly effective, its potential to reduce GA costs can be further amplified by pairing it with battery storage systems. This addresses a key limitation: solar panels only generate electricity when the sun is shining, which means their effectiveness may be reduced if a peak demand period occurs on a cloudy day or after sunset.
- Stored Energy for Peak Periods: With battery storage, excess solar energy generated during sunny hours can be stored and used later during peak demand periods, even if they occur outside of daylight hours. This ensures that businesses always have access to solar power during the most critical times, further minimizing their reliance on the grid and reducing their GA costs.
Conclusion: A Strategic Solution to Lower GA Costs
Solar power is a strategic investment for businesses seeking to reduce their Global Adjustment charges. By generating electricity onsite, especially during peak demand periods, businesses can minimize their reliance on the grid and significantly lower their proportional contribution to the GA charge. For the greatest impact, companies can enhance their solar systems with battery storage and leverage forecasting tools to optimize their energy use during critical times. This not only results in significant cost savings but also supports sustainability efforts, making solar power a win-win solution for Class A businesses in Ontario.
At Circuit Energy, we are committed to providing you with a renewable energy solution tailored specifically to your facility’s unique needs, limitations, and preferences, ensuring the perfect fit for your green energy transition. Please feel free to contact us for a quick chat for your renewable energy projects.
