Watt Are You Paying For?

The phrase "the good old days" describes a time (real or imagined) that a person thinks was better or simpler. The good old days were when the electric bill was proportional to how many times the black line on the thin metal disk inside the glass of the electric meter rotated.

The table below is an example of an industrial company’s electric bill. Starting from the usage column, you will see that there are three periods of the day for which different multiplying factors are used as part of the demand readings: on-peak, off-peak1, and off-peak2. Demand is the maximum or peak average value over the demand interval, which can be as simple as 15 minutes or made up of subintervals, such as three 5-minute subintervals. The latter results in a new calculated average value every 5 minutes over the prior 15 minute period.

Knowing when the intervals start and stop would allow a user to schedule the turn-on of large loads so as to reduce the peak value in any interval. Subintervals make synchronization harder since the same load value will show up in three different interval calculations. However, you can figure it out (if you have an electronic watt-meter) by watching when the demand value updates.

Note last month’s demand numbers are slightly less than this month’s. This makes sense, as the average outside temperature was lower, and the HVAC system makes up approximately one-third of this company’s bill. Lighting is a third, and the manufacturing process is the final third. Next is the energy consumption in -kilowatt-hours, which only has two different periods, on- and off-peak.

Then, look at distribution demands, which is the peak value that occurred a year or more ago. Remember that demand is a racheted value—exceed your previous peak value in any demand interval and that demand value will stay on the books for a year or more, depending on your utility’s rate structure. This category also has two calendar periods, annual and summer. Summer’s rate is going to be higher than the annual one. And there are distribution demand values for the three daily time intervals.

As a result of reregulation (when some utilities separated into generation, transmission and distribution companies and then reconsolidated each other’s parts), there are the generation and transmission supply capacity (aka demand) values. Note that the generation value is larger than the distribution demand, which was what was measured at meter during that peak time in the past. It appears that may have been the apparent power (V × I) value that occurred at the maximum demand. The generator needs to be able to produce the required voltage at the peak current level, even though the loads may use it inefficiently, typically with a power factor (PF = W ÷ VA) between 0.8 and 0.9. That is why some utilities also add PF penalty rates for consumers with low power factors, as they must produce volt-amperes, even though it is used at a much lower watts.

Now, the business side of the bill. There is a service charge for being served electricity, one for the betterment of society and for helping to make the system secure. I am not sure how the amount of electricity used affects the utility’s costs of those items, but the latter two have a multiplier of the kilowatt-hours. If you look at the distribution demand charges, you will see what was mentioned above. The values used are not based on the actual readings from the month, but on a past peak value of 276 kW. Apparently, no advantage comes from having low demand values in the off-peak hours, since they don’t factor into the equation. Energy consumption does use the on- and off-peak values with separate multipliers, though strangely, they charge more for the off-peak. The supply end (G&T) get its share of billing with demand and energy costs, with the on-peak energy consumption costs being the highest portion of this bill.

With all of that confusion in the past, what to do to use less of the “more expensive” watts will be in a future article.

BINGHAM, a contributing editor for power quality, can be reached at 732.287.3680.

About the Author

Richard P. Bingham

Power Quality Columnist
Richard P. Bingham, a contributing editor for power quality, can be reached at 732.287.3680.

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