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Understanding the Capacity Tariff: What It Means for Your Energy Bills and How to Save Money
As part of its efforts to promote more efficient use of the electricity grid and a shift towards renewable energy sources, the Flemish government has introduced the Capacity Tariff, a new pricing system for energy consumers. This tariff aims to encourage users to spread out their energy usage and reduce their peak demand, which in turn can help save money on energy bills. In this blog post, we will explore what the Capacity Tariff is, how it works, its impact on energy bills, and most importantly, how you can save money by managing your energy usage efficiently.
Understanding the Capacity Tariff:
What It Means for Your Energy Bills and How to Save Money
Why Is the Capacity Tariff Important?
The Capacity Tariff is a newly introduced pricing system introduced by the Flemish government to optimize the use of the electricity grid. This is part of the preparation to transport more electricity for mobility, heating, and industry. The capacity tariff will overcome the strain on the grid. The Capacity Tariff aims to encourage users to spread out their energy usage and reduce their peak demand.
How Does the Capacity Tariff Work?
If you have a smart meter, you’ll be charged not only for the amount of energy you consume but also for your peak demand (in kilowatts or kW) during a 15-minute interval. The Capacity Tariff for a digital meter is an average of €42,15 per kW peak per year, compared to a fixed fee of €105,40 per year for a traditional meter. Additionally, the kWh tariff (i.e., the price per unit of energy consumed) for a digital meter is lower compared to a traditional meter. The grid fee for a digital meter is €0.0408 per kWh, while a traditional meter has a fee of €0.0624 per kWh, which is 54% higher!
What’s the Impact of the Capacity Tariff on Your Energy Bill?
If you don’t manage your energy usage efficiently, your peak demand can spike, which means you’ll pay more. For instance, if your peak demand increases from 11 kW to 15 kW, you could pay €14 more per month or 6% more on your energy bill.
As a driver, it’s important to keep in mind that reducing the load capacity can significantly affect the charging speed of your vehicle. It’s possible that at times, even if you charge your car at home with a speed of 30km/h, you may not be able to fully charge it when you need it.
It’s imperative to note that the figures may vary based on your location and the specific tariff in your area. Also, if you have solar panels, you’ll no longer have to pay the prosumer fee with a digital meter.
Generally speaking, the capacity tariff costs you 3,5€/kW/month. One kW saved in a month saves you 3,5€ while one kW consumed in a month costs you 3,5€/month.
How Can You Save Money on Your Energy Bill with the Capacity Tariff?
To reduce peak demand and save money, you can spread out your energy usage throughout the day or avoid using multiple high-consumption appliances simultaneously. If you have an electric vehicle and want to charge it at home, it won’t necessarily increase your energy costs, but it could affect peak demand. Charging your EV at a lower charging speed can help you save money but also means it will take longer to charge your car.
The Capacity Tariff aims to promote more efficient use of the electricity grid and a shift towards renewable energy sources. By managing your energy usage and reducing peak demand, you can save money on your energy bills.