Does installing grid-tied PV really reduce the power company's peak generating or transmission requirements?
I often hear that PV can be used to delay or even avoid building a new power station.
In my town we have our highest annual electrical loads in the mid to late summer. We also have some great afternoon thunderstorms. We call them monsoons. In the last 3 of 5 years, at the moment of peak annual load, our town was covered by clouds. You may think this is impossible. If there are clouds, then the electrical loads (air conditioning) should be lower. I admit this sounds a bit bazaar.
But the real world is often stranger than fiction. In our case, we were having a typical hot sunny day. Then in a 10 minute period of time, our town which is about 10 miles by 10 miles square was overshadowed by one of those great monsoon rain clouds. The interesting part is that the electric demand of the town continued to rise for 15 more minutes. It seems that there is a delay between the time the building get shadowed and when the ACs respond to the lower load. Or maybe everyone just started turning on their lights. It does get dark when these clouds roll in.
So this actually happened 3 of the last 5 years! For the power company to depend on a power source like PV, their reliability guidelines only allow 1 such event every 10 years. So this means they must build in the generation capacity for the case that the PV is cloud covered when the annual peak demand is occurring. It happens too often for them to ignore it. The only relief the PV offers is that even under dark cloud cover it can still produce 10% of its rated output.
One last point. Your town might have much different weather patterns than mine and distributed PV might have a better chance to be illuminate at the moment of annual peak power demand 9 of 10 years or whatever the utility demands for reliable service. The drawback is that peak demand occurs at 4:30 to 5:00 pm where I live and it might be the same for you. This is several hours past solar noon. PV output is down 30-50% by then. You can face the panel more southwest to try to synchronize the peak PV output with peak energy demand, but you then lose in total energy output and burn more fossil fuels annually. But all this can be a fun optimization problem.
So in my town, PV only marginally helps reduce peak generation requirements for the utility and if we grow and need to add more generation capacity, adding PV will not delay this much.