Business - Know What You're Paying For

You pay for more than generation of electricity in your electric bills, which is all you really hear about. But did you know that generation can be as little as one third of your bill. You pay a rate for metered usage for generation yes, but you may also pay a rate for demand and several fixed 'Riders' as well.

Demand is the amount of electricity that you are using at any one time. And the amount that you pay is sensative to both the size of the demand and fluctuations in demand. In many cases the fluctuation can be considerable and that can get expensive. The more the fluctuations the higher the costs.

Each month the highest demand, over a period of time (typically thirty minutes), is registered and stored in your electric meter. When your meter is read both the metered usage and the demand is read and then demand reset. Both the metered usage and the demand is used to calculate your bill. If you have fluctuations in your demand then you will notice that the demand multiplier changes. If the demand multiplier is greater than one then you are paying an additional amount for your demand. The higher the number the more you are paying.

To reduce your monthly costs it is important to look at both your usage and your demand. Controlling both is key to managing your total costs. Lowering your usage and demand are different but not completely seperate issues. Smart controls can be used to manage both and help you manage your costs.