Most electric utilities bill customers for their actual use of electricity using two metered components: the highest average electrical energy use in any 15 or 30 minute period during the month (called the demand), and the total energy use during the month. Demand is usually measured in kW and each kW is charged at a specified $/kW basis each month. This monthly demand charge may change based upon the level of demand. For example, the demand charge could be $15 per kW for the first 100 kW, $12 per kW for the next 900 kW, and $10 per kW for demands in excess of 1,000 kW. Some utilities only measure the demand during their peak hour periods and may not charge a customer for higher demands registered during their off peak period.
The meters needed to measure this are much more expensive than simple kWh meters. That is why some utilities "mimic" the demand measurement for residential customers using a block rate where the first block of kWh used is at one price and power used above that in a month is at a different rate. The theory behind this is that residential customers all require the same basic utility facilities to provide service. However the energy needs for most commercial and industrial customers are too varied to use such a simple approximation.
Typical Demand Rate Billing Example:
|
|
|
| kWh
| Total
| Average
|
| Demand
| Cost
| kWh
| Cost
| Cost
| Cost ($/kWh)
|
| 400 kW
| $3,000
| 100,000
| $5,000
| $8,000
| $0.080
|
| 200 kW
| $l,500
| 100,000
| $5,000
| $6,500
| $0.065
|
| 600 kW
| $4,500
| 100,000
| $5,000
| $9,500
| $0.095
|
Utilities measure demand using a special meter with a demand indicator or digital register, or an attachment to the kilowatt-hour meter. This latter device causes the kWh meter to generate "pulses" proportional to the rate at which energy is consumed. These pulses are recorded on paper for graphic display, on magnetic tape, or some other means. Utilities may be able to provide this pulse output to your EMCS in some cases.
The demand register is reset at the beginning of each billing interval (usually 30 days). Actual demand and consumption varies from interval to interval and can be an extremely informative chart to review. You should be able to see what equipment you are operating and shut off as peaks and valleys of this demand chart. The summation of all these individual 15 or 30 minute period values is the total energy consumed during the billing period. The longest line represents the maximum or peak demand in the billing period.
