Demand vs Service Size

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Electriman

Senior Member
Location
TX
Good morning every one.

I am confused on a relationship between service size and demand. Why utilities charge for demand and lets say when I have a 3000A service size what kind of demand should I request?

Thanks,
 
Over here we submit a load calc to the utility.

Our utility then installs their equipment sized to serve that load, regardless of the service size you may be installing.
 
Cow said:
Over here we submit a load calc to the utility.

Our utility then installs their equipment sized to serve that load, regardless of the service size you may be installing.
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In some of the projects, owners are asking to design a large service size for future load. Would you in this case, consider a future load in your load analysis to achieve the expected service size or would you keep your load analysis the same but change the service?
 
Electriman said:
I am confused on a relationship between service size and demand. Why utilities charge for demand and lets say when I have a 3000A service size what kind of demand should I request?
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You do not request a demand amount.
The demand charge is a method for the utility to charge you for the system capacity, that they are making available, even though you may not be using it.

The normal power rate is a charge for how much you use over the course of the billing period, which is typically one month. It goes up and down based on your usage.
The demand charge is based on the highest amount you use in a particular period (usually a 15 minute interval). It typically takes 12 months before it drops.
The service size is an estimate of your power requirements, including anticipate future needs, and is used by the utility to determine the size of the components they provide.
 
Electriman said:
Good morning every one.

I am confused on a relationship between service size and demand. Why utilities charge for demand and lets say when I have a 3000A service size what kind of demand should I request?

Thanks,
Click to expand...

You dont really "request demand", however one utility around here asks for "expected demand" on the load sheet. I am not really sure why they ask that. They are going to come up with their actual load estimate anyway so I feel like coming up with that demand figure is their deal. I typically just divide the NEC number by 2.2.

Electriman said:
In some of the projects, owners are asking to design a large service size for future load. Would you in this case, consider a future load in your load analysis to achieve the expected service size or would you keep your load analysis the same but change the service?
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Considering that actual load will often be around half of NEC size, I usually just figure that any future expansion (unless of course there is the possibility of some very large expansion) will fit under the existing service down the road using 220.87.
 
Details may vary in some places, but often you are charged a minimum fee whether you use the energy or not. Therefore you do not want to have too high of an agreed on demand base if you don't ever use it. But at same time you usually are penalized if you go over that base - or can also depend on time of day whether or not you are able to go over a peak demand without penalty.

It cost them to assure there is adequate capacity for you even if you don't use it. It cost them if you exceed capacity during peak times.

If you don't have the load now, you probably want to look into what it will cost to have a lower demand base vs having a higher demand base but not use it and make decision accordingly. If selecting the lower base, change it when you do add more load, or before you know you will add it if there is an annual period for making such changes. Overage penalties can sometimes be killers.
 
kwired said:
Details may vary in some places, but often you are charged a minimum fee whether you use the energy or not. Therefore you do not want to have too high of an agreed on demand base if you don't ever use it. But at same time you usually are penalized if you go over that base - or can also depend on time of day whether or not you are able to go over a peak demand without penalty.

It cost them to assure there is adequate capacity for you even if you don't use it. It cost them if you exceed capacity during peak times.

If you don't have the load now, you probably want to look into what it will cost to have a lower demand base vs having a higher demand base but not use it and make decision accordingly. If selecting the lower base, change it when you do add more load, or before you know you will add it if there is an annual period for making such changes. Overage penalties can sometimes be killers.
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So what I hear are two opposite things. Jim is saying we don't ask for demand and you are saying we have to have a demand since that is the basis for charge/cost. Which one is correct?
 
Electriman said:
So what I hear are two opposite things. Jim is saying we don't ask for demand and you are saying we have to have a demand since that is the basis for charge/cost. Which one is correct?
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depends on rate structure of your POCO.

Small businesses and residential customers usually don't have a demand fee. They often actually do pay more per kilowatt hour than a large consumer does. The larger consumer often pays a minimum fee whether they use the energy associated with that fee or not, they may still have a per kW/hr charge but is likely at a lower rate than it is for the smaller consumer. The demand charge assures the POCO takes in expenses they have just to assure the energy is available if needed. If not needed consumer has lost that money and could have had a lower demand threshold, the careful balance of things is to not have too low of a threshold and end up paying penalties for too much demand. Some cases on site generation can still pay for itself in lesser demand fees and penalties if you rely somewhat to on site generation during peak demand periods. Allows you to avoid overage penalties as well as to subscribe to a lower base demand. This possibly only best for the abnormal peak demand and not a regularly occurring peak demand.
 
Along with what kwire says, we have a dairy that is notified by the POCO when they need to switch to generator during peak summer usage. The rate is lower by having that alternate source. They are also on demand and power factor rate.

A couple years ago they missed going off line a time or two when notified. Ouch.

Last summer we worked on PF correction for them and noticed that the milk cooler was not cycling properly. Having that corrected made a bigger impact then the capacitors we had installed to that point.
 
ptonsparky said:
Along with what kwire says, we have a dairy that is notified by the POCO when they need to switch to generator during peak summer usage. The rate is lower by having that alternate source. They are also on demand and power factor rate.

A couple years ago they missed going off line a time or two when notified. Ouch.

Last summer we worked on PF correction for them and noticed that the milk cooler was not cycling properly. Having that corrected made a bigger impact then the capacitors we had installed to that point.
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I am guessing the generator won't run parallel to the utility, and you switch the feeder from utility to the generator, am I right?
 
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