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Chiller Load (Tons)

A majority of the technology developed for energy management has dealt with the more efficient consumption of electricity, rather than timing the demand for it. Variable frequency drives, energy efficient lights, electronic ballasts and energy efficient motors are a few of these consumption management devices. These techniques often only impact a small portion of the facilities demand (when compared to say the mechanical cooling equipment), which is normally a major portion of the facilities overall annual electric bill. The management of demand charges deals very little with conservation of energy, but mainly with the ability of a generator to supply power when needed. It is this timing of consumption that is the basis of demand management and the focus of thermal energy storage (TES).

Experts agree that demand management is actually not a form of energy conservation but a form of cost management. Throughout the 1980's and most of the 1990's, Demand Side Management (DSM) was done by utilities in order to manage generating capacity and costs by promoting demand reduction though incentives (financial rewards) and disincentives (rate structures). Most of the incentive programs have ceased due to surplus generation capacity and the approach of retail electrical deregulation. A deregulated market place will surely impact the cost of energy for many customers and if the commodity pricing experiments of the recent past are any indication of the future, demand costs, and thus demand management, will remain as an important cost control strategy for utilities and the energy users.

Utilities often charge more for energy and demand during certain periods in the form of on-peak rates and ratchet clauses. The process of managing the generation capacity that a particular utility has "on-line" involves the utilization of those generating units that produce power most efficiently first since these units would have the lowest avoided costs (ultimately the actual cost of energy). When the loads are approaching the connected generation capacity of the utility, additional generating

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