Utility Services
Utility Services
This domain tests how utility rates and service characteristics shape energy cost and project economics. Expect demand charges, time-of-use energy, power factor, ratchets, load profiles, standby and net metering.
Core rules
- Bills often combine kWh energy charges, kW demand charges, and fixed customer charges; demand can dominate low-load-factor accounts.
- Billing demand may be the monthly peak, a ratchet (e.g., a percentage of the prior 11-month peak), or a kVA value.
- Power factor = kW / kVA. Low power factor increases kVA and can trigger penalties or capacity charges.
- Time-of-use rates price energy by period; shifting load can save energy charges but may raise demand if peaks coincide.
- Net metering and standby tariffs define how on-site generation is credited and what backup charges apply.
Worked example
A plant uses 300,000 kWh/month at $0.08/kWh = $24,000 energy. Billing peak is 750 kW at $12/kW = $9,000 demand. The utility charges $5 per kVA above 90% power factor. At pf 0.82, kVA = 750 / 0.82 = 914.6. At pf 0.90, kVA = 750 / 0.90 = 833.3. Excess = 81.3 kVA; penalty = 81.3 × $5 = $406.50/month. Correcting pf reduces the penalty but not the 750 kW demand.
Traps
Do not treat billing demand as average load. Do not confuse kW and kVA. Check ratchets and time-of-use windows before claiming savings. A demand reduction only saves money when it reduces the billed demand determinant.