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Commercial Energy Guide

Peak Shaving in Ontario:
Cut Global Adjustment & Demand Charges

How commercial solar and battery storage reduces peak demand charges and Global Adjustment costs for Ontario businesses. ROI analysis, eligible business types, and how Solar X engineers demand management systems. Updated March 2026.

By Solar X Engineering Team — ESA/ECRA Certified·

Key Takeaways

  • 1Global Adjustment represents 30–50% of a commercial Ontario electricity bill — battery peak shaving directly reduces this cost.
  • 2Class B commercial customers pay GA at a flat per-kWh rate. Class A customers pay based on their actual peak contribution — enabling 30–60% GA savings with optimized peak shaving.
  • 3A 250 kWh commercial battery system can reduce annual demand charges by $15,000–$40,000 for a medium Ontario facility.
  • 4Commercial battery storage qualifies for the 30% federal ITC and 100% Class 43.2 capital cost allowance in year one.
  • 5Solar X performs a 12-month interval demand analysis before recommending any peak shaving system size.

Understanding Global Adjustment in Ontario

Global Adjustment (GA) is Ontario's mechanism for recovering the cost of contracted electricity generation above the wholesale market price. It funds nuclear refurbishment, renewable energy contracts, and conservation programs. For commercial customers, GA is the single largest and most controllable component of an electricity bill.

Ontario commercial customers fall into two classes based on annual consumption:

  • Class BFacilities using less than 500 kW average monthly peak demand. GA is charged as a flat rate per kWh — no incentive to reduce peak consumption specifically.
  • Class ALarge facilities (typically 1 MW+ demand). GA is calculated based on the facility's share of Ontario's top 5 peak demand hours annually. Reducing consumption during those 5 hours can cut GA costs by 30–60%.

For Class A facilities, a battery system that reliably detects and responds to Ontario's top 5 peak hours — discharging to reduce facility demand during those windows — directly reduces the GA allocation and can save hundreds of thousands of dollars annually.

Peak Shaving ROI — Ontario Commercial Scenarios

The following estimates are based on Ontario commercial electricity rates, Class B GA charges, and solar + battery systems engineered for demand management. Actual savings vary by demand profile and GA class.

Facility TypePeak DemandBattery SizeAnnual SavingsPayback
Small commercial (retail/office)50–150 kW50–100 kWh$8,000–$18,0005–7 years
Medium industrial200–500 kW150–300 kWh$20,000–$50,0004–6 years
Large manufacturing500 kW–1 MW400–800 kWh$50,000–$120,0003–5 years
Cold storage / food processing300–800 kW200–500 kWh$35,000–$90,0003–5 years

Estimates based on Ontario Class B GA rates and standard commercial demand charges. After 30% federal ITC, payback periods are 1–2 years shorter.

Solar + Battery vs. Battery-Only Peak Shaving

Both approaches reduce demand charges, but combining solar with battery storage maximizes the financial return — solar generation offsets daytime consumption while the battery handles peak demand events.

FactorBattery OnlySolar + Battery
Demand charge reductionHighHigh
Daytime energy cost reductionNone30–60% of daytime load
Federal ITC eligibility30% (if solar-charged 50%+)30% on full system
Class 43.2 CCA100% year 1100% year 1
Annual energy savings added$0$15,000–$60,000+
5-year net savingsDemand charges onlyDemand + energy combined
Payback period5–8 years3–6 years

Case Study: Ontario Cold Storage Facility

A 400 kW peak demand cold storage facility in the GTA installed a 200 kWh battery system + 150 kW rooftop solar array. The battery automatically discharges when demand approaches 350 kW, capping demand charges.

$42,000
Annual demand charge reduction
$28,000
Annual solar energy savings
4.2 years
Payback period (after ITC)
Book a demand analysis for your facility →

Frequently Asked Questions

What is peak shaving in Ontario?+
Peak shaving is the practice of reducing a business's electricity consumption during peak demand periods — typically the highest-demand hours of the day — to lower demand charges and Global Adjustment costs. In Ontario, commercial and industrial customers on Class B rates pay Global Adjustment based on their share of the province's top 5 peak demand hours each year. Battery storage systems automatically discharge during these windows, reducing the facility's peak demand contribution and lowering GA costs.
What is Global Adjustment and how does battery storage reduce it?+
Global Adjustment (GA) is a charge on Ontario electricity bills that funds the difference between contracted generator prices and the wholesale market price. For Class B commercial customers, GA is charged as a fixed rate per kWh — averaging $0.08–$0.12/kWh and representing 30–50% of a commercial electricity bill. Battery storage reduces GA exposure by discharging during the peak hours that determine Class A eligibility, potentially shifting large facilities to Class A status where GA is calculated on actual peak contribution rather than a flat rate.
Which Ontario businesses benefit most from peak shaving?+
Businesses with high peak demand relative to their average consumption benefit most: manufacturing facilities, cold storage and refrigeration operations, data centres, agricultural operations with irrigation peaks, large retail, and office buildings with high HVAC demand. The larger the gap between peak demand and average demand, the greater the battery peak shaving ROI.
How much can a business save with peak shaving in Ontario?+
Savings depend on facility size, demand profile, and GA class. A medium commercial facility (500 kW peak demand) with a 250 kWh battery system can reduce annual demand charges by $15,000–$40,000. Class A facilities with optimized peak shaving can reduce GA costs by 30–60%. Solar X provides a custom demand analysis before recommending any system size.
What size battery is needed for commercial peak shaving in Ontario?+
Commercial peak shaving systems typically range from 100 kWh to 2 MWh depending on peak demand magnitude and duration. A facility with a 200 kW demand spike lasting 30 minutes needs approximately 100 kWh of storage. Solar X performs a 12-month interval demand analysis to identify peak windows and right-size the battery system for maximum demand charge reduction.
Does commercial solar qualify for the federal ITC for peak shaving systems?+
Yes. Commercial battery storage systems used for peak shaving qualify for the 30% federal Clean Technology ITC when the battery is charged from solar or an eligible renewable source at least 50% of the time. Systems charged primarily from the grid may qualify at a reduced rate. Solar X structures commercial installations to maximize ITC eligibility. Additionally, Class 43.2 provides 100% accelerated capital cost allowance in year one.

Reduce Your Demand Charges Today

Solar X engineers commercial peak shaving systems that cut Global Adjustment and demand charges — backed by a 12-month interval data analysis before any commitment.

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