Many grid codes penalize consumers who exceed their contracted MD (excess demand penalty, often 1.5x to 2x the normal rate).
Why does this matter? Because utility companies do not just charge for energy consumed (kWh); they charge for the peak rate of consumption (MD). A factory that runs smoothly at 100 kW for 24 hours pays less in demand charges than a factory that sits idle for 23 hours but spikes to 500 kW for one 15-minute interval. maximum demand calculation
Utilizes detailed current allowance reduction tables based on circuit type. Australia (AS/NZS 3000) Many grid codes penalize consumers who exceed their
A simplified calculation permitted for dwelling units and specific commercial buildings, allowing a flat demand factor to be applied to the total connected load above a certain threshold (e.g., 100% of the first 10 kVA, and 40% of the remainder). BS 7671 / IET Wiring Regulations (United Kingdom) A factory that runs smoothly at 100 kW
The sum total of the continuous power ratings of all electrical appliances, fixtures, and machinery installed within a facility. It represents the power consumed if every single device were turned on and operating at full capacity simultaneously.
Then came the era of Diversity.
All demand and diversity factors applied should be documented, along with the standard references used. This ensures calculations can be reviewed, validated, and updated as needed.