Wholesale electricity prices go up and down throughout the day. Energy arbitrage is a smart way to take advantage of these price changes to save money. By storing electricity when prices are low and using it when prices are high, you can reduce your electricity bill and use energy more efficiently. Businesses and homeowners can use battery storage systems to make energy arbitrage work for them. With the help of smart technology, like Redx AI, the process can be automated to maximise savings.
In this guide, we’ll explain energy arbitrage, how it works, and how it can help you save on your electricity bill.
What is Energy Arbitrage?
Energy arbitrage means buying electricity when it’s cheap and using it when it’s expensive. Electricity prices change based on demand. During the day, when many people use power, prices go up. At night or during off-peak hours, prices drop because demand is lower.
By using a battery, you can store electricity when prices are low and use it when prices go up. This helps you reduce power bills and avoid paying high peak rates.
How Does Energy Arbitrage Work?
Energy arbitrage follows a simple process:
1. Store Cheap Electricity
- A battery storage system charges up when electricity prices are low (usually at night or during off-peak hours).
- This stored energy can come from the grid or solar panels.
2. Use Stored Energy During Peak Hours
- When demand is high, electricity prices increase.
- Instead of buying expensive electricity from the grid, you use the stored energy in your battery.
3. Save on Electricity Bills
- You reduce your electricity costs by shifting energy use from expensive peak times to cheaper off-peak times.
- This is especially useful for businesses with high energy needs or homeowners looking to cut energy expenses.
Benefits of Energy Arbitrage
1. Lower Electricity Bills
Using stored electricity instead of buying power during peak hours helps you save on your bill.
2. Reduce Dependence on the Grid
With battery storage like Redx RX-7000Plus, you rely less on the electricity grid, making your energy supply more stable.
3. Make the Most of Solar Power
If you have solar panels, you can store excess solar energy during the day and use it at night, maximising savings.
4. Support a Greener Energy System
By using stored energy instead of drawing from the grid during peak times, you help balance energy demand and reduce reliance on fossil fuels.
How Redx AI Maximises Energy Arbitrage Savings
Managing energy arbitrage manually can be complicated. That’s where Redx AI comes in.
Redx AI uses smart technology to monitor electricity prices and automatically:
✅ Decide the best time to store and use energy
✅ Optimise battery storage for maximum savings
✅ Reduce electricity bills without user intervention
By integrating Redx AI with battery storage, businesses and homeowners can save more money and make energy use more efficient.
FAQ – Energy Arbitrage Explained
1. Who can benefit from energy arbitrage?
Anyone with a battery storage system can benefit, including homeowners and businesses looking to lower electricity bills.
2. Do I need solar panels for energy arbitrage?
No, but having solar panels helps store free energy, making arbitrage even more effective.
3. Can energy arbitrage work automatically?
Yes! With smart technology like Redx AI, energy arbitrage happens automatically for maximum savings.
4. How much can I save with energy arbitrage?
Savings depend on electricity prices and battery capacity, but most users cut energy costs significantly.
5. Is battery storage required for energy arbitrage?
Yes, a battery energy storage system (BESS) is needed to store and use electricity efficiently.