Peak Demand

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Definition: The highest level of electricity demand within a particular time period, often measured in 15-minute or hourly intervals.

Relevance to energy: Peak demand determines the required capacity of power systems and often influences electricity pricing structures.

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Benefits:

• Helps utilities plan for power generation and distribution
• Can incentivize energy conservation during high-demand periods
• Informs the development of demand response programs

Drawbacks:

• Can lead to higher electricity rates during peak hours
• May require changes in consumer behavior to manage effectively
• Can strain power grids if not properly managed

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Statistics: The U.S. Energy Information Administration reports that summer peak demand for electricity in the contiguous United States is projected to reach 756 gigawatts (GW) in 2022, up 2.6% from the 2021 summer peak.