Quick answer
Peak shaving is flattening short consumption spikes by drawing energy from a battery at those moments instead of from the grid. Because grid use for businesses in Belgium is partly billed on peak power (kW) rather than only on consumed kWh, every avoided kW of peak structurally lowers your bill. For industrial profiles with short, sharp peaks, peak shaving often yields €15,000 to €80,000 per year, on top of income from self-consumption and flexibility.
Why peak power has become so expensive
Grid operators bill less and less on pure volume and more and more on power. For residential and small business consumers this happens via the capacity tariff on the average monthly peak; for larger connections on the distribution or transmission grid, the power element has long been part of grid tariffs and the peak-power component of the supplier invoice.
The effect is asymmetric: one compressor starting up together with everything else for ten minutes a month can set a peak that drags along for twelve months. The energy itself costs almost nothing in that quarter hour; the peak you register because of it does.
How peak shaving works technically
An energy management system (EMS) measures your offtake continuously per quarter hour and projects where the quarter hour will end. As soon as expected offtake threatens to exceed a set threshold, the battery discharges exactly the difference. The grid sees a flat line; your processes keep running undisturbed.
Three parameters are crucial: the battery's power (kW) determines how high a peak you can flatten, the capacity (kWh) determines for how long, and the EMS's metering resolution and reaction speed determine whether you see the peak coming in time at all.
- Short, sharp peaks (starting currents, welding installations, presses): little kWh needed, lots of kW — choose power over capacity.
- Broad peaks (shift changes, cooling on hot days): several hours of energy needed — capacity weighs heavier.
- Charging infrastructure for trucks or vans: combine peak shaving with smart charge management, otherwise you just push the peak forward.
What does it earn? A worked example
Take a production company with a measured monthly peak of 850 kW, of which about 120 kW is caused by short coincidence peaks. A 300 kW / 600 kWh battery flattens that 120 kW completely.
| Item | Without peak shaving | With peak shaving | Difference |
|---|---|---|---|
| Measured monthly peak | 850 kW | 730 kW | −120 kW |
| Grid cost on power (indicative €40/kW/year) | €34,000 | €29,200 | −€4,800 |
| Peak power component supplier | €25,500 | €21,900 | −€3,600 |
| Extra self-consumption solar park | — | +€18,000 | +€18,000 |
| Flexibility income (VPP, imbalance) | — | +€21,000 | +€21,000 |
| Total annual benefit | — | — | ≈ €47,400 |
Stacking peak shaving with other revenue models
A battery that only flattens peaks sits idle the vast majority of the time. That is wasted capacity. The strongest business cases stack at least three value streams: peak shaving, self-consumption of own solar production and flexibility via a virtual power plant or the imbalance market.
That stacking does require the control to know a hierarchy: peak shaving always has priority, because a missed peak costs twelve months. Only with the remaining free capacity is arbitrage done or bidding on flexibility markets. In our own hybrid portfolio (85 MW+ solar, 45 MWh+ storage) that is the standard configuration.
Pitfalls that undermine the business case
- Sizing on the annual peak instead of the peak profile: you buy too many kWh and too few kW, or vice versa.
- Not using historical quarter-hourly data: without at least 12 months of metering data every calculation is guesswork. Request your metering data from your grid operator.
- Treating the EMS as a side issue: the hardware sets the ceiling, the control determines what you actually realise from it.
- Forgetting that processes change: a new production line or charging park changes your peak profile completely. Provide contractual room to revise thresholds.
Frequently asked questions
What is peak shaving in one sentence?
Peak shaving is temporarily deploying a battery or other flexibility to absorb short consumption spikes, so the grid registers a lower maximum offtake and your power-based grid costs fall.
How much can peak shaving lower my energy bill?
That depends entirely on how spiky your profile is. Businesses with flat processes gain little; businesses with short, high coincidence peaks typically save 10 to 25% on the power-based components of their bill.
Do I need solar panels for peak shaving?
No. Peak shaving works with a battery alone. But the payback period shortens considerably when the same battery also stores your own solar production, because you then combine two value streams in one investment.
What battery size do I need?
Always start from 12 months of quarter-hourly data. First determine how many kW you exceed your desired threshold by, then how long those exceedances last. The product of both gives your minimum kWh; the maximum gives your required kW.
Does peak shaving also lower the capacity tariff?
Yes. The capacity tariff is calculated on the average monthly peak of the last twelve months. Every month in which you lower that peak also lowers the rolling average on which you are billed.
Can a battery flatten peaks and bid on the imbalance market at the same time?
Yes, provided the control treats peak shaving as the highest priority and always keeps reserve capacity free. In practice there is ample capacity left for flexibility income, because real peaks occur only a few percent of the time.