The demand charge question

General explainer · Site-specific conclusions require the actual tariff, contract and operating information.

Usage and demand describe different things.

Energy consumption records how much electricity is used over time. Demand describes the level of power being drawn at a point or interval. A business can use a similar amount of energy across two periods but produce a different demand profile.

Start with the actual tariff.

Demand charging arrangements vary. The applicable tariff and contract define the measurement, units, time windows and charging method. Read those terms before assuming that shifting one peak will change the bill.

Connect the profile to the operation.

Interval data becomes more useful when matched to operating hours and major loads. Consider whether equipment starts together, which loads can move and which must remain available. Operational constraints belong in the assessment.

Compare the options on the same basis.

A different contract, a control change or storage may affect costs in different ways. Model each against the same baseline and state the limitations. A technically possible demand reduction is not automatically an economical project.