# Understanding Electricity bill, Demand supply charge

I'm looking at Coned bill of our company for the first time. I'm a bit shocked how much we get charged every month.
\$5000 every month. It doesn't look like 10 cents per kWh as I always have heard.

So, I went through the bill to understand how ConEd charges, there's a few things I don't quite understand;

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July ,2014 ConEd bill:
Your Supply charges:
Energy supply 20,800 kWh \$1,235.75
Demand supply 57.6 kW \$940.65

Your delivery charges:
Energy delivery 20,800 kWh \$702.65
Demand delivery 57.6 kW \$1,375.09

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1. What is delivery charge? Actually it's more than supply charge. Does ConEd charge a seperate charge for delivery?

2. This is the most I don't understand. It has a significant amount of dollar allocated, 'Demand supply'. reading quickly online, it's the total amount of electricity used during peak hours of the billing period. But why is kW, not kWh? And how 57.6 kW turns to \$940.65 in calculation?
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Asked:
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Commented:
ConEd charges businesses this way.  They charge based on the demand level and not on the kWh.

Here's how to read the bill:
http://www.coned.com/customercentral/threebill_Over50KWDual.asp

from here:

http://www.coned.com/customercentral/newbill.asp

Not the same thing as your residential billing where you're being charged by the kWh.
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Commented:
Also, everyone, including residential customers are charged for supply and delivery.
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Author Commented:
I read it already, which still doesn't explain much how I get demand supply charge that much.
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Commented:
Is this the first time that you're seeing a bill this large?  What are the usual bills?

Here's the explanation of Demand based billing:

http://www.coned.com/customercentral/demandbilling.asp
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Author Commented:
Need calculation to question#2. What does it mean by 57.6kW? Does it mean at some point I turned on 57.6kW of total wattage in my building? And how it's translated to \$940.65?
Also, how they determine 57.6kW?
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Commented:
This is from the link I posted above about Demand Billing:

How Demand Billing Works

There are two energy-related charges in demand billing. One is for the amount of electricity used during the entire billing period - this is the energy charge (measured in kwhrs). Relating to the previous example, this would be -equivalent to the gallons of water used. The other charge is for the greatest amount of electric power used in any one-half hour during the billing period - this is the demand charge (measured in kW or kilowatts of demand). Again, relating to the previous example, this would be equivalent to the rate of water used (measured in gallons per hour).

So during a 30 minute period last month you were measured at 57.6kW.
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Author Commented:
I already read it also, but still can't understand how ConEd determines 57.6kW for what period and how it reaches \$940.

Customer Central
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understanding demand billing
What Is Demand?

The term "demand' refers to the demand made by the customer upon the Company for the reserve of certain capacity. Whatever the energy requirements may be, we must maintain facilities with sufficient capacity to meet the maximum requirements of our customers. Even though these facilities may not always be used at full capacity, they are nonetheless required so that the electricity is available to customers whenever they want it. The demand charge reflects these capacity-related costs.

What Does a Demand Meter Do?

A simple way of thinking about how a demand meter works is to compare it to a water faucet and a bucket of water. If you turned on a water faucet, water would flow out and fill a bucket. If you continued to open the valve, water would flow out of the faucet at a greater rate (the demand for water) and more water would be delivered (the water used). One way of measuring the rate of water coming out of the valve might be in gallons per hour. You would want to know this so that you could provide the piping and pressure needed and have adequate supplies of water available to support this level of water "demand." You'd also want to know how much water was delivered for the customer to use so that you could bill for the service.

Unlike water, electricity cannot be stored - but the concept is similar. A demand meter is like the water faucet and bucket. It records the electricity used (measured in kwhrs) and the rate of electricity used (measured in kW) in 30-minute intervals.

How Demand Billing Works

There are two energy-related charges in demand billing. One is for the amount of electricity used during the entire billing period - this is the energy charge (measured in kwhrs). Relating to the previous example, this would be -equivalent to the gallons of water used. The other charge is for the greatest amount of electric power used in any one-half hour during the billing period - this is the demand charge (measured in kW or kilowatts of demand). Again, relating to the previous example, this would be equivalent to the rate of water used (measured in gallons per hour).
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Commented:
How Demand Billing Works:

This answers your question:

There are two energy-related charges in demand billing. One is for the amount of electricity used during the entire billing period - this is the energy charge (measured in kwhrs). Relating to the previous example, this would be -equivalent to the gallons of water used. The other charge is for the greatest amount of electric power used in any one-half hour during the billing period - this is the demand charge (measured in kW or kilowatts of demand). Again, relating to the previous example, this would be equivalent to the rate of water used (measured in gallons per hour).

So during a 30 minute period last month you were measured at 57.6kW.
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Author Commented:
How Load Factor Calculated?

The formula to calculate the load factor is: total kilowatt-hours (kwhrs) in the billing period divided by the result of multiplying the number of days in the billing period times 24 hours times the maximum demand (kW) in the billing period; multiply the answer by 100 to get the load factor:

[kWhrs / (# of days in billing period x 24 hrs x billable demand [kw] ) x 100 = % LF]

For example, if the customer used electricity at the maximum rate for each and every 30-minute period in the billing period, the resulting load factor would be 100%. If, on the other hand, the maximum demand is used for only half of the billing period, the load factor would be about 50%. Normal load factors range from 10% to 60%. Property Protection periodically generates and reviews ad hoc reports of load factors outside of this range.
I got the load factor 47.1% from the formular at the bottom of the link.

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My Load Factor:
28,000kWh / (32 days * 24 hrs * 57.6 kW) * 100 =47.1%

I got the Load factor from this formular. Now how this turns to \$940?
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Commented:
Here is the current rate sheet for ConEd.

I don't know what rate you're at or where you're located, so this may not be the correct rate sheet, however this shows the per kW charge for Supply.  this is Market, however, I don't know if you have a contract with ConEd or what not.

Came from here: http://www.coned.com/rates/supply_charges.asp

http://www.coned.com/documents/elecPSC10/StatMSCCAP-8.pdf
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Author Commented:
It seems very complicate. and the demand charge rate varies every month.
Thanks for the link. I think I have to reserve more times to read...
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