No. of Recommendations: 2
Con Edison commercial bills include a Demand Charge, a per-kilowatt (kW) fee covering the cost of your peak power draw, especially important in summer, plus Energy charges (kWh usage) and various Delivery/Supply fees, reflecting costs for grid maintenance and power supply. Your bill's capacity component is often under "Demand Delivery Charges" or "Demand Supply," showing costs for the peak power you pull, not just total usage, with specific summer (June-Sept) rates higher. In short, you pay a premium all year for the one day your usage spikes.
The demand charge is to compensate the utility for the cost of running wires large enough to carry the maximum load - and is still charged today, but I guess there is not a premium charged for the necessary increases in the size of the rest of the infrastructure..
Back during the first half of last century, my grandfather came up with a niche scheme. He was an electrical contractor specializing in commercial (factory) installations. He noticed that one group of customers, commercial laundries all had steam boilers. He would offer them their choice of either buying a steam engine and electric generator to allow them to cease using the local electric utility (Consolidated Edison - ConEd) or he would install it for free, but they would be obligated to pay him half the saving in electric bills for a period of ten years. (He frequently had to sue to keep getting the payments after the customers realized how much he was making on the freebie installation (sort of how model phone companies make money giving away iPhones).
Anyhow, ever now and then, there would be a glitch and the emergency transfer switch would flip the plant onto ConEd power. Even a minute of connection would mean the owners would have to pay the demand charge for entire laundry for the next year. Unfortunately, they had to repair a pipe running over the top of the electric meter and unfortunately, a wrench would drop onto the glass meter, smashing the meter which magically read zero usage afterwards.
As the bible clearly states: "There's nothing new under the sun" (for those who care, I just looked it up: Ecclesiastes, chapter 1, verse 9)
Jeff
No. of Recommendations: 4
The demand charge is to compensate the utility for the cost of running wires large enough to carry the maximum load
That makes some sense.
In France, to oversimplify a bit, on top of the charge for consumption they charge you a minimum monthly fee based on the rating of the breaker by the meter, whose capacity you get to choose. That fixed charge is surprisingly high, and it doesn't vary with how much power you use. You're paying for the fact that you MIGHT use that much power.
Jim
No. of Recommendations: 0
<< In France, to oversimplify a bit, on top of the charge for
consumption they charge you a minimum monthly fee based on
the rating of the breaker by the meter, whose capacity you
get to choose. That fixed charge is surprisingly high,
and it doesn't vary with how much power you use. You're
paying for the fact that you MIGHT use that much power.>>
Similar in Portugal, though this policy it didn't prevent our
Apagão (blackout) here and in Spain last April.
-Rubic
