Rising population, hotter temperatures, and the energy needs of booming industries like manufacturing and data centers are fueling a steep increase in electricity demand across the U.S. Experts estimate that demand is growing by nearly 3% annually, with even sharper spikes during the summer months. In fact, last year’s summer peak demand jumped by 10 gigawatts—twice the increase seen the year before.
To address this growing need, utilities have ramped up power plant construction, especially in solar and wind. But while renewables are key to a cleaner energy future, they’re intermittent by nature and can go offline during grid disturbances. This makes it challenging to rely on them exclusively—especially during periods of peak demand.
In response, utilities are increasingly turning to variable pricing and demand response programs. These strategies, once reserved for the largest power users, now leverage advanced technologies to monitor and engage a broader customer base. Utilities can alert customers when demand is high, encouraging them to reduce usage by offering lower rates during off-peak hours.
While this shift helps balance the grid, it introduces new challenges for building operators. Managing electricity use is no longer just about total annual consumption—it now requires real-time awareness.
“Many of our customers are having to shift from annual monitoring to tracking usage in 15-minute intervals,” said Greg Turner, Chief Solutions Engineering Officer at Honeywell.
To keep up, buildings are adopting smart monitoring systems and automation software that can respond quickly when prices spike. But even with these tools, managing peak loads often requires more than just software.
Energy storage, particularly battery systems, has emerged as a promising solution. Storing cheap energy for use during expensive peak times makes sense in theory—but in practice, batteries can be costly, bulky, and often fall short in duration.
“Most buildings don’t need a 30-minute solution. They need something that lasts four hours or more,” Turner explained.
As a result, batteries are frequently paired with other load management tools.
One increasingly popular tactic is pre-cooling or pre-heating buildings during off-peak times to reduce HVAC demand during expensive hours. This approach requires a solid grasp of a building’s thermal inertia—its ability to retain heat or coolness. New software tools can now analyze variables like temperature zones, sun exposure, and occupancy to better predict how and when to adjust temperatures without sacrificing tenant comfort.
Some buildings are also exploring more innovative solutions, such as ice or chilled water storage systems, which allow them to shift cooling loads away from peak hours. Others are investing in geothermal systems, which use underground temperature stability to improve HVAC efficiency. Though expensive upfront due to the drilling required, geothermal is becoming more viable as technology improves—much like heat pumps did two decades ago.
Despite political pushes to expand fossil fuel use, energy prices remain high, especially during peak periods. As the cost of labor rises and access to financing tightens, building owners are under more pressure than ever to control energy expenses. Combining smart load management, advanced controls, and innovative storage solutions will be essential to keeping utility costs in check and maintaining operational efficiency.
Source: propmodo