Electricity Prices Explained


Electricity Prices

Electricity prices reflect tariffs, kWh rates, time-of-use schedules, peak demand charges, and grid congestion, driven by generation costs, transmission losses, and load profiles in power systems and industrial electrical engineering.

 

What Are Electricity Prices?

Electricity prices are costs per kWh shaped by tariffs, time-of-use, demand charges, and grid operating constraints.

✅ Defined per kWh with time-of-use and demand charges

✅ Influenced by generation mix, transmission losses, congestion

✅ Managed via load control, demand response, smart metering

 

Electricity prices, or rates, are usually determined by electric utilities and the governmental organizations that oversee them. The fees an electric utility company charges its customers for service aer based on electricity prices set by government, except in the case where they cost electricity prices on a deregulated basis. In that case, electricity prices are determined by marketplace factors such as supply and demand. Electric utility companies charge their customers different rates, depending on the type of customer, the kind of contract, and on the customer's needs. Electricity Prices bill energy on the kwh basis of the individual customer's rate, the level of consumption, and other charges, such as taxes and fuel adjustments. This is how electricity billed. For a deeper breakdown of typical rate components, resources like electricity cost guides explain line items and surcharges clearly.

That collection of rates is called a tariff. The power tariff is designed to provide the privately owned electric utility with enough income to allow investors to earn a cash return and cover operation and maintenance costs. Most of the larger utilities operate as regulated franchises, meaning that the prices they charge are subject to public review, often by a State public utility commission. In competitive markets, customers may choose an electricity supplier while the utility still handles delivery services and billing oversight.

Publicly owned electric utilities are nonprofit, local government agencies established to provide service to their communities and nearby consumers at cost, returning excess funds to the consumer in the form of community contributions, more economic and efficient facilities, and lower power rates. To meet these community objectives, public power agencies plan their electricity supply over multiyear horizons to manage risk and affordability.

Publicly owned electric utilities (which number approximately 2,000) include municipals, public power districts, State authorities, irrigation districts, and other State organizations. Some of these organizations also own or contract for electricity generation assets to enhance self-sufficiency and rate stability.

There are approximately 900 cooperative electric utilities in the United States currently doing business in 47 States. These utilities are owned by their members and are established to provide power to those members. Because member education supports better usage decisions, many cooperatives provide primers on what electricity is and how it is measured on bills.

Average retail Electricity prices of power are calculated by dividing utility revenue by retail sales. The resulting measurement is the cost, or average revenue per kilowatthour, of power sold. (A kilowatthour is equal to one watt of power supplied to an electric circuit steadily for 1,000 hours.) Electric utilities usually offer three primary classes of service: residential, commercial, and industrial. The average price per kilowatthour for residential consumers is generally higher than for any other sector due in part to higher costs associated with serving many consumers who use relatively small amounts of power. In Ontario, the industrial sector has the lowest energy prices and energy bills rates every month due to the economies of serving a few consumers who use relatively large amounts of electricity. Understanding the distinction between energy in kilowatthours and instantaneous electricity power demand helps customers interpret peak charges and capacity fees. Regional consumption patterns, including trends in electricity demand in Canada, can influence wholesale prices and cross-border power flows affecting local rates.

Related News

Harmonic Distortion

Harmonic distortion is the deviation from the ideal electrical waveform caused by nonlinear loads. It impacts power quality, increases heat in equipment, and can lead to system inefficiencies. Monitoring and mitigation are essential in industrial electrical systems.

 

What is Harmonic Distortion?

Harmonic distortion is not a new phenomenon in power systems. Concern over distortion has fluctuated several times throughout the history of AC electric power systems.

✅ Reduces overall power quality and system reliability

✅ Can damage equipment and increase heat generation

✅ Requires monitoring to ensure system efficiency and safety

In the 1930s and 1940s, the primary sources were transformers, with the primary problem being inductive interference with open-wire telephone systems. Early arc lighting caused similar concern due to its harmonic content, just as today’s electronic power converters do.

Today, nonlinear devices like variable frequency drives (VFDs), arc furnaces, computer power supplies, and LED lighting introduce significant harmonic distortion into electrical systems. Nonlinear devices do not draw current in a linear relationship to voltage, which distorts the sinusoidal waveform and introduces harmonic currents. Harmonic distortion is one of the many issues covered in our comprehensive Power Quality resource channel, which explores causes, effects, and solutions.

 

Why It Matters

  • Harmonics degrade power quality

  • Increase energy losses and heat in conductors and transformers

  • Lead to premature failure of motors and sensitive electronics

  • Interfere with communication lines

In contrast, voltage sags and interruptions are nearly universal to every feeder and represent the most numerous and significant power quality deviations. The end-user sector suffers more from harmonic problems than the utility sector. Industrial users with adjustable speed drives, arc furnaces, induction furnaces, and similar equipment are significantly more susceptible to problems caused by harmonic distortion. To understand the relationship between harmonics and apparent energy flow, see our explanation of Apparent Power vs Real Power.

A good assumption for most utilities in the United States is that the sine wave voltage generated in central power stations is very good. In most areas, the voltage found on transmission systems typically has much less than 1% distortion. However, the distortion increases as the load approaches. At some loads, the current waveforms barely resemble a sine wave. Electronic power converters can chop the current into seemingly arbitrary waveforms. Managing nonlinear loads often requires Power Factor Correction to reduce harmonic effects and improve efficiency.

 

Industry Standards

  • IEEE 519: Sets recommended harmonic limits for both voltage and current.

  • IEC 61000-4-7: Defines methods of measuring harmonics and interharmonics.

 

Harmonic Distortion and Nonlinear Devices

Harmonic distortion is caused by nonlinear devices in the power system. A nonlinear device is one in which the current is not proportional to the applied voltage. Figure 1 illustrates this concept using the case of a sinusoidal voltage applied to a simple nonlinear resistor, where the voltage and current vary according to the curve shown. While the applied voltage is perfectly sinusoidal, the resulting current is distorted. Increasing the voltage by a few percent may cause the current to double and exhibit a different waveform. You can calculate your system’s power quality impact using our Apparent Power Calculator for precise performance metrics.

This is the source of most harmonic distortion in a power system. Figure 1 illustrates that any periodic, distorted waveform can be expressed as a sum of sinusoids. When a waveform is ideal from one cycle to the next, it can be represented as a sum of pure sine waves in which the frequency of each sinusoid is an integer multiple of the fundamental frequency of the distorted wave. This multiple is called a harmonic of the fundamental, hence the name of this subject matter. The sum of sinusoids is referred to as a Fourier series, named after the great mathematician who discovered the concept. Nonlinear loads like VFDs and arc furnaces can affect grounding; learn more in our guide to Electrical Grounding.

 


 

Fig. 1. Current distortion caused by nonlinear resistance

 

Voltage and Current Distortion

The term "harmonics" is often used by itself without further qualification. Generally, it could mean one of the following three:

  1. The harmonic voltages are too great (the voltage is too distorted) for the control to properly determine firing angles.

  2. The harmonic currents are too great for the capacity of some devices in the power supply system, such as transformers, and the machine must be operated at a lower than rated power.

  3. The harmonic voltages are too great because the harmonic currents produced by the device are too great for the given system condition.

Clearly, there are separate causes and effects for voltages and currents, as well as some relationship between them. Thus, the term harmonics by itself is inadequate to describe a problem definitively. Nonlinear loads appear to be sources of harmonic current, injecting harmonic currents into the power system. For nearly all analyses, it is sufficient to treat these harmonic-producing loads simply as current sources. There are exceptions to this as described later.

 


 

Fig 2. Harmonic currents flowing through the system impedance result in harmonic voltages at the load.

Voltage distortion is the result of distorted currents passing through the linear, series impedance of the power delivery system, as illustrated in Fig. 2. Although assuming that the source bus is ultimately a pure sinusoid, there is a nonlinear load that draws a distorted current. The harmonic currents passing through the system's impedance cause a voltage drop for each harmonic. This results in voltage harmonics appearing at the load bus. The amount of voltage distortion depends on the impedance and the current. Assuming the load bus distortion stays within reasonable limits (e.g., less than 5%), the amount of harmonic current produced by the load is generally constant.

While the load current harmonics ultimately cause voltage distortion, it is worth noting that the load has no control over the voltage distortion. The same load put in two different locations on the power system will result in two different voltage distortion values. Recognition of this fact is the basis for the division of responsibilities for harmonic control that is found in standards such as IEEE Std 519-1992.

  • Control over the amount of harmonic current injected into the system occurs at the end-use application.

  • Assuming the harmonic current injection is within reasonable limits, the control over voltage distortion is exercised by the entity that controls the system impedance, typically the utility.

One must be careful when describing harmonic distortion phenomena, as there are distinct differences between the causes and effects of harmonic voltages and currents. The use of the term harmonics should be qualified accordingly. By popular convention in the power industry, the term is used by itself most of the time when referring to load apparatus, indicating that the speaker is referring to the harmonic currents. When referring to the utility system, the voltages are generally the subject. For systems affected by harmonic-induced overheating, understanding Capacitor Bank applications is essential for voltage support and harmonic filtering. For in-depth harmonic analysis, explore our guide to using a Power Quality Analyzer to identify waveform distortion and power anomalies.

 

Related Articles

 

View more

Three Phase Electricity Explained

Three phase electricity delivers power using three alternating currents that are offset in phase. It provides consistent and efficient energy for industrial, commercial, and high-load applications, improving stability and reducing conductor size.

 

What is Three Phase Electricity?

Three phase electricity is a power system that uses three alternating currents, each offset by 120 degrees, to deliver constant power flow.

✅ Delivers more efficient and stable power than single-phase systems

✅ Ideal for large motors, commercial buildings, and industrial equipment

✅ Reduces conductor material and energy loss over long distances

 

Three phase voltage, frequency and number of wires

Three phase electricity is the dominant method of electrical power generation, transmission, and distribution across the industrialized world. Unlike single-phase systems, which rely on a single alternating current, three-phase systems use three separate currents, each 120 degrees out of phase with the others. This setup provides a consistent and balanced power flow, making it significantly more efficient for high-demand applications, such as motors, transformers, and large-scale infrastructure. Understanding the difference between alternating current and direct current is essential to grasp how three-phase systems deliver constant power using offset waveforms.

 

Understanding the Concept

At the heart of a three-phase system are three sinusoidal waveforms, evenly spaced to maintain a continuous flow of energy. When one phase reaches its peak, the others are in different parts of their cycle, ensuring that at any given moment, some power is being delivered. This creates what is known as constant power transfer, a major advantage over single-phase systems that experience power dips between cycles. Since three-phase systems rely heavily on accurate current flow measurement, it’s important to know what ammeters measure and how they help monitor system balance.

For industrial and commercial operations, this stability translates to increased energy efficiency, extended equipment lifespan, and reduced operating costs. Large electric motors, for example, run more smoothly on three-phase power, which avoids the surging and vibration commonly associated with single-phase inputs.

 

A Brief History

Three phase electricity wasn’t invented by a single person but emerged through the contributions of several pioneers in the late 19th century. Galileo Ferraris in Italy, Nikola Tesla in the United States, and Mikhail Dolivo-Dobrovolsky in Europe all played crucial roles in developing and refining the idea of three-phase alternating current. Tesla’s patents and Dolivo-Dobrovolsky’s practical systems laid the groundwork for what is now a global standard. Engineers use wattmeters to accurately measure real power in three-phase systems, while Watts Law helps calculate the relationships between voltage, current, and power.

 

Wye and Delta Configurations

Three-phase systems are typically wired in one of two configurations: the Wye (Y) or Delta (Δ) configuration. Each has specific advantages depending on the application:

  • In a Wye connection, each phase is tied to a central neutral point, allowing for multiple voltage levels within the same system. This is common in both commercial and residential applications, where both high and low voltages are required.

  • A Delta connection utilizes a closed loop with no neutral, a configuration commonly found in industrial setups. It delivers the same voltage between all phases and is ideal for running large motors without needing a neutral return path.

One of the most important relationships in these configurations is the √3 ratio between line voltage and phase voltage, a fundamental aspect that engineers use in calculating load, cable sizing, and protective device coordination.

 

Technical Benefits

Three-phase systems have built-in advantages that go beyond stability. Because the sum of the three phase currents is zero in a balanced load, a neutral wire is often unnecessary. This reduces the amount of conductor material needed, lowering costs and simplifying design. Additionally, three-phase motors naturally create a rotating magnetic field, eliminating the need for external circuitry to start or maintain rotation.

Another major benefit is that power output remains consistent. In single-phase systems, power drops to zero twice per cycle, but three-phase systems deliver non-pulsating power, which is especially important in sensitive or precision equipment. The function of a busbar is especially important in three-phase distribution panels, helping to manage multiple circuit connections efficiently.

 

Where and Why It’s Used

While most homes use single-phase electricity, three-phase is the standard in virtually all commercial and industrial environments. Factories, data centers, hospitals, and office buildings rely on it to power everything from HVAC systems and elevators to conveyor belts and industrial machines.

Three-phase is also common in electric vehicle (EV) charging stations and renewable energy systems, where efficient, high-capacity delivery is essential. If you're working with three-phase motors or transformers, knowing the role of a conductor and how electrical resistance affects current flow is fundamental to efficient design.

For sites that only have access to single-phase power, phase converters—whether rotary or digital—can simulate three-phase conditions, enabling them to operate three-phase equipment. This flexibility has made three-phase solutions accessible even in remote or rural areas. Three-phase systems often operate at medium voltage, especially in commercial settings, and their stability can reduce the risks of ground faults.

 

Voltage Levels and Color Codes

Depending on the region, the standard line and phase voltages vary. In North America, typical voltage values include 120/208 volts and 277/480 volts, whereas in Europe and much of Asia, 230/400 volts is more common. Wiring color codes also differ: red/yellow/blue in Europe, black/red/blue in North America, and other variations depending on the country's electrical code. These standards ensure safety, compatibility, and ease of troubleshooting.

 

The Global Standard for Power

Three-phase electricity is not just a technical solution; it is the foundation of modern electrical infrastructure. Its ability to deliver large amounts of power efficiently, safely, and reliably has made it the system of choice for more than a century. From powering the machines that build our world to the systems that keep us connected, three-phase electricity remains indispensable.

 

Related Articles

 

View more

Free Electricity Explained

Free electricity is power generated without fuel costs, typically from solar or wind sources. After setup, systems like solar panels can reduce or eliminate bills through net metering, helping promote sustainability and energy independence for homes and businesses.

 

What is Free Electricity?

Free electricity refers to energy that costs nothing to generate after initial setup, typically utilizing natural sources.

✅ Harnesses renewable energy sources like solar panels and wind turbines

✅ Reduces or eliminates long-term electricity costs

✅ Promotes sustainable and eco-friendly living solutions

 

The Reality of Free Electricity

True “free electricity” does not exist in the sense of unlimited, no-cost power available without investment. However, generating your electricity at home through solar panels or small wind systems can reduce your reliance on the power grid and lower your energy bills significantly, sometimes to zero. This cost reduction is what many people mean when they refer to "free electricity."

Purchasing and installing a solar power system is not free, but it pays off over time. It’s a long-term investment that benefits both the environment and your finances. Some homeowners even reach the point where their solar systems generate more electricity than they use.

In such cases, through a policy known as net metering, these homeowners can send excess electricity back to the power grid and receive compensation from their utility company.

 

What is Net Metering?

Net metering is a billing arrangement that allows consumers who generate their own electricity to send excess power back to the grid and receive credit for it. Here’s how it works:

  • Net metering allows you to sell the electricity produced by a solar system on your home back to the electric power grid.

  • Net Metering occurs when your meter spins backwards as solar electricity is being produced, storing the excess energy on the grid.

  • Once energy is actually being consumed, your meter spins forward to collect the energy that has been saved on your electric power grid.

  • For the energy that you do not consume, the electric utility will compensate you. If you get paid enough money from the electricity that you don't use and sell to them, then that profit can be used to pay for your existing consumption, making it essentially free electricity.

Some utilities offer cash payments for the surplus, while others provide energy credits that reduce your bill. Either way, your electricity costs can be significantly reduced—and in some cases, essentially eliminated.

 

Key Considerations for a Free Electricity System

A few things to watch out for when choosing to invest in a Free Electricity solar power system.

  • You must conserve your energy consumption to ensure that you don't exceed the amount of solar energy produced.

  • By exceeding the amount of power generated many times for the grid or saved, you are then charged regular rates for electricity provided by your electric utility.

  • You must watch your solar energy production. Keep track of the daily energy production of your system.

  • Check your utility bill each month to ensure that you are credited or reimbursed for any and all extra energy generated.

  • To control your electricity usage, consider using a time-of-use electric meter to further capitalize on your investment.

 

Utility Policies Vary

Not all utility companies offer generous net metering. Some may only provide energy credits, while others pay wholesale rates for your excess electricity. It's essential to check with your local utility to understand how they handle customer-generated power.

While the term “free electricity” is somewhat misleading, it does accurately reflect the very real possibility of generating low-cost or no-cost power after your initial system is installed. Through renewable energy systems and programs like net metering, homeowners can reduce or eliminate energy bills and make a lasting contribution to a cleaner, more sustainable future.

 

Related Articles

 

View more

Electricity Power Explained

Electricity power underpins voltage, current, and wattage in generation, transmission, and distribution across the grid, integrating AC/DC systems, transformers, generators, load management, power factor correction, and renewable energy for efficient, reliable supply.

 

What Is Electricity Power?

Electricity power is energy transfer rate: voltage times current, yielding watts in AC/DC systems.

✅ P = V * I; apparent, real, reactive power relationships

✅ Power factor improves efficiency and reduces I^2R losses

✅ Transformers step voltage for transmission efficiency

 

The make up of the electricity power sector has been in transition over recent history. In most provinces, there has been a transition from traditional electric utilities (which are mostly provincially-owned crown corporations) to private generation, transmission and distribution assets. For context, industry overviews such as electricity generation in Canada outline how policy and market structures influence capacity additions today.

In 2014, Canadian eutilities and industrials generators produced more than 639 terawatt hours of electricity. When it comes to hydroelectric power, Canada is the world's second largest producer. Hydroelectricity accounts for 59.3 per cent of Canada’s supply. Other energy sources that contribute to the transfer of energy include: coal, uranium, natural gas, petroleum and non-hydro renewable energy sources. About 67 per cent of Canada’s energy comes from renewable sources like wind, solar and hydroelectric power stations and 82% from non-greenhouse gas emitting sources. A breakdown of major fuels is available through sources of electricity for readers comparing provincial mixes.

Hydropower output is intrinsically linked to water availability and operations, and resources on water and electricity explain how hydrology and infrastructure shape generation profiles.

In 2014, almost 59 terawatt hours of electricity exported to the USA, while about 13 terawatt hours was imported from the United States. These trade patterns reflect how provinces balance load and generation portfolios, as noted in discussions of electricity supply dynamics under varying market conditions.

Canada's industrial sector is responsible for the largest share of electricity demand because there are a number of energy-intensive industrial activities like mining, oil and gas production, pulp and paper production, and other primary industry uses. Residential and commercial sectors consume much smaller quantities of electricity for lighting (light bulb), heating, and communications. Detailed consumption patterns can be explored in Canada's electricity demand by sector and region.

R&D programs aimed at maintaining the operating capability of the nation’s existing nuclear power plants and developing the next generation of nuclear technologies. Nuclear energy is the world’s largest source of emission-free electricity power. The Nuclear Energy program is working to develop cost-efficient technologies that further enhance nuclear safety, minimize the generation of nuclear waste, and further reduce the risk of proliferation. Within the broader generation portfolio, resources like nuclear are profiled in guides on how electricity is generated across different technologies.

To meet the rising demand of the 21st century, significant improvements in America’s electric system are necessary. Blackouts serve as a powerful reminder of the critical role electricity plays in the everyday lives of people.

 

Voltages, currents, power energy

When it comes to electric current, electrical voltage, electric circuit dynamics and energy powers, all rely on the flow of the electron. What this means is that power voltage feeds loads, solid state power load devices, and other loads that need electric power. Electric power is the rate at which that power is measured in watts or voltage in volts. There are various forms of energy measured in si unit: apparent power, reactive power, ac power, real power in watts, etc. For a refresher on fundamental concepts and terminology, see what is electricity to connect these quantities with practical applications.

Electrical Engineers and Scientists alike seek common views in order to develop new technologies for the storage of energy and the transmission of electric potential through power circuits that will contribute to energy efficiency of the electric industry. For instance, the copper wires used in typical transmission lines lose a percentage of the electricity passing through them because of resistance over long distances, which causes the wires to heat up. But "superconducting" materials have no resistance, and if they are used to transmit electricity in the future, very little of the electricity will be lost.

 

Related Articles

View more

Saving Electricity and Electrical Energy

Saving electricity through energy efficiency, power factor correction, load balancing, and demand response integrates smart meters, VFDs, and SCADA to cut losses, optimize voltage, and improve grid reliability in industrial and commercial systems.

 

What Is Saving Electricity?

Saving electricity applies engineering methods to cut losses, optimize loads, and improve efficiency and reliability.

✅ Implement power factor correction capacitors to reduce reactive power.

✅ Use VFDs for motor speed control and peak demand reduction.

✅ Deploy smart meters, SCADA, and analytics for load balancing.

 

Saving electricity becomes an increasingly important issue the more the cost of power increases. There is no such thing as cheap electricity. That is a basic fact in today's world of increasing costs for all forms of energy. It's a common fact that vast amounts of electric power are wasted every year in the world, mostly in areas where power is cheap and abundant. However, in recent years, as the supply of electricity generation has remained static and at the same time demand for power continues to increase, the power prices have increased dramatically. For a refresher on the fundamentals, see this brief guide to what electricity is to better frame consumption trends.

One of the leading cost inputs of electric energy is the cost of generation energy inputs. For instance, if all power generation came from oil, you can imagine what the cost of power would be. Since most power is generated from burning coal and natural gas, as the cost of these commodities increases, so does the cost of electric generation. A quick overview of primary sources of electricity clarifies how fuel price volatility feeds into rates.

Saving electricity, on the other hand, is one of the least expensive ways to generate large amounts of power is from the use of water in hydroelectric generation stations. Hydropower is covered among methods that generate electricity efficiently when geography permits.

The other least expensive way to generate power is from the use of uranium in nuclear power stations. Yes, nuclear power stations are very expensive to build but given the amount of power they generate, plus the fact that they operate 24 hours a day, makes them a very cost-effective way to generate electric power. Alongside nuclear, many regions are expanding alternative electricity options to diversify supply.

 

Using Less, Quickly
Energy conservation can be accomplished quickly when each home saves electricity through less consumption. This is accomplished by turning lights off when not needed. You can also turn off appliances and use less heat. First, power saver improvements can be made to the electrical equipment such that consumers receive the same services but with less power consumed. (These are sometimes called “efficiency improvements”). In the second case, the energy consumer takes deliberate measures to reduce energy use through changes in operations or procedure which may also cause inconvenience and result in a loss of service. These are typically called “behavioral” changes. For step-by-step ideas, practical checklists on how to save electricity can help households prioritize actions without sacrificing comfort.

 

Technical Efficiency Improvements
The technical measures to save consumption quickly are similar to those used to save power slowly except that they may be implemented with greater intensity by combining them with special subsidies or delivery schemes. Three examples are described below.

Retrofits—especially retrofits of large, energy-using facilities—are attractive targets during an energy crisis. About 8% of industrial power consumption is used to make compressed air, much of which is lost through system leaks. Understanding the relationship between electricity and power helps target leaks and idle loads more effectively.

Lighting replacements have been the most frequently used retrofit strategy. Replacing incandescent light bulbs with compact fluorescents (CFLs) was used in Brazil, California, and New Zealand. California consumers installed nearly eight million CFLs during the crisis period, resulting in almost 500 MW of demand reduction (Pang 2003). California cities replaced millions of traffic lights with LED lamps, each saving about 80 watts. California aggressively encouraged consumers to replace older appliances with new units qualifying for the Energy Star endorsement of high efficiency. While there is no such thing as truly free power, discussions about free electricity often highlight bill-lowering strategies and policy incentives.

When it comes to saving electricity, there are many techniques one can easily apply. Conservation (or using less) is the best and most extreme way. But when using less is not possible, the next best thing for energy conservation is the use of more energy efficient electrical equipment, such as:

 

  • Energy efficient electric Motors. Electric motors consumer 75 per cent of all power consumed by industry and any large consumer of power will save money by installing more energy efficient electric motors.
  • Variable frequency drives that operate and control electric motors and are good at saving electricity. These devices control the speed and torque and starting characteristics of large horsepower motors and one of the best ways for using less and earning more.
  • Energy efficient electric lighting is also good at saving electricity. There are lots of more efficient electric lighting technologies and control systems on the market today.
  • Energy efficient home appliances like refrigerators and dishwashers and clothes washers and dryers can make a large impact on your power bill.
  • A High-Efficiency Energy heating system saves heating and money.
  • Off-peak electric utility rates from electric utilities reward customers for saving electricity because they can provide consumers with an incentive to shift their power consumption into periods of the day when the electric utility is not at or near full generating capacity like late at night.

 

Related Articles

View more

Green Electricity

Green electricity integrates renewable energy sources such as solar PV, wind turbines, and hydropower into smart grids, improving power quality, decarbonization, efficiency, and reliability for industrial loads and utility-scale networks.

 

What is green electricity?

Green electricity is renewable-source power via smart grids to cut emissions and enhance system efficiency.

✅ Integrates PV, wind, hydro with power electronics and converters

✅ Enhances grid stability via inverters, FACTS, and smart protection

✅ Reduces CO2, improves efficiency, supports microgrids and storage

 

Green electricity is a term describing what is thought to be environmentally friendly sources of electricity. Typically, this refers to renewable and non-polluting energy power sources. For a broader perspective on how different technologies contribute, see this overview of sources of electricity across modern grids.

Green electricity includes natural energetic processes which can be harnessed with little pollution. Anaerobic digestion, geothermal power, wind power, small-scale hydropower, solar power, biomass power, tidal power and wave power fall under such a category. Some versions may also include power derived from the incineration of waste. Comparisons with other clean options are summarized in this guide to alternative electricity solutions used worldwide.

 

Energies Wind Electricity 
The winds that blow across the UK can be harnessed by turbines to provide Green electricity. Wind turbines sited in suitable locations already provide a small, but growing percentage of the UK's electricity, and are used successfully all around the world. In fact wind power is the world's fastest growing energy source! Wind turbine technology has greatly improved over the last ten years, making wind turbines quieter and more efficient so that electricity generated from the wind is now often competitive with traditional coal-fired and nuclear power stations. Wind turbines are also beginning to be built at sea — in the future much of our electricity could come from these offshore windfarms. Understanding how turbines integrate into national systems is covered in this primer on electricity generation methods and planning.

 

Solar Electricity
Many people believe that we don't get much solar Green electricity here in the UK. In fact solar power is already being used to provide essential power for many types of equipment being used in both remote and urban areas across the country. A solar photovoltaic (PV) module works by converting sunlight directly into electricity (even on cloudy days) using semiconductor technology. The vast majority of solar modules available today use "waste" silicon from the computer chip industry as the semiconductor material. They can be integrated into buildings and even made into roof tiles virtually indistinguishable from normal tiles. 
Solar Electricity can also be used to heat water directly using specially designed collectors. Even in winter a useful amount of hot water can be produced from roof top collectors. A third way to use solar energy is simply to design buildings to make maximum use of the sun. Using this so-called 'passive solar' approach, much of the energy that we currently use for heating, lighting and air conditioning can be saved. Homeowners can explore practical steps to generate electricity with rooftop PV and storage.

 

Hydro Electricity
Water turbines have been used to provide Green electricity for over 100 years and presently provide over 1% of the UK's electricity. Although most of the possible sites for large hydropower stations in the UK have already been developed, there is a large potential for smaller schemes. These can either use a small dam or work as a 'run of the river' system which has a minimal impact on the local environment. Design considerations for small schemes are outlined in this resource on water electricity systems for communities.

 

Wave Electricity
Many different devices have been designed over the years to try and capture some of this huge energy resource — the latest one has recently started generating Green electricity on the isle of Islay, off the West Coast of Scotland. In this machine waves hitting the shore are channelled into a large tube to power a specially designed turbine. With the proper support, wave power could provide a significant proportion of the UK's electricity needs in the future.

 

Tidal Electricity
Tidal power has been used in Britain for over a thousand years — at the time of the Doomsday book over 5,000 tide powered mills were recorded. Unlike other Green electricity renewable energy sources, which depend on the weather, tidal power is as predictable as the tides themselves. One way to capture tidal energy is to build a barrage across an estuary, storing water behind it as the tide rises and then releasing the stored water through turbines at low tide. Several sites around the UK could be suitable for this type of tidal system, the largest being the Severn Estuary. Another way is to use 'marine current turbines', which work like underwater wind turbines, harnessing tidal currents instead of the winds.

 

Geothermal Electricity
Geothermal energy comes from hot rocks deep underground. In some parts of the world steam comes to the surface and can be used to run steam turbines to produce Green electricity directly. In other places water can be pumped down and heated by the rocks to make steam. Geothermal energy can also be used to provide hot water and heating for buildings. Case studies of enhanced systems are available in this overview of geothermal electricity projects worldwide.

 

Biomass Electricity
Either agricultural wastes or specially grown plants can be used as a fuel to run small Green electricity power stations. As plants grow they absorb carbon dioxide (the main gas responsible for climate change) which is then released when the plants are burnt. So using biomass does not add any extra carbon dioxide into the atmosphere. Specially grown 'energy crops' provide not only an environmentally sound source of electricity, but also an important new opportunity for farmers. Analyses of supply chains and grid impacts appear in this review of electricity production from biomass and other renewables.

 

Landfill gas Converted to Electricity
As rubbish decomposes in the landfill sites where our household waste is dumped, it gives off methane gas. This gas can be captured and burnt in a gas turbine to produce an attractive Green electricity tariff. Burning the gas does give off carbon dioxide but since methane, which is emitted from the landfill site, is in fact a much more powerful greenhouse gas it is better to burn it than to allow the methane to escape into the atmosphere. There are already many landfill gas systems operating in the UK.

 

Waste Incineration Electricity
The UK generates an enormous amount of waste, and space at landfill sites is quickly running out. The best solution would be to recycle as much of the waste as possible, but instead incinerators are being constructed to burn the waste. In some cases the energy is being used to generate green electricity. However many environmentalists are still concerned about the emission of harmful dioxins and also about the loss of a valuable resources that could have been recycled. You can read about Greenpeace's views on incineration.

 

Related Articles

View more

Sign Up for Electricity Forum’s Newsletter

Stay informed with our FREE Newsletter — get the latest news, breakthrough technologies, and expert insights, delivered straight to your inbox.

Electricity Today T&D Magazine Subscribe for FREE

Stay informed with the latest T&D policies and technologies.
  • Timely insights from industry experts
  • Practical solutions T&D engineers
  • Free access to every issue

Live Online & In-person Group Training

Advantages To Instructor-Led Training – Instructor-Led Course, Customized Training, Multiple Locations, Economical, CEU Credits, Course Discounts.

Request For Quotation

Whether you would prefer Live Online or In-Person instruction, our electrical training courses can be tailored to meet your company's specific requirements and delivered to your employees in one location or at various locations.