Quote:
Originally Posted by DasBoot
So, if you haven't reduced consumption, how is this device going to save on your electric bill?  |
By reducing the demand charge. Utilities charge on consumption (kWh) and also on demand (KW). You're kWh charge is for consumption and your KW charge is for your demand. You're demand charge rate is called a ratchet. If you are in a low ratchet your demand charges are low, but if your demand ratchet is high you pay through the nose. Utilities have to build plants large enough to handle the demand of the area they service even if the peak demand only reaches their max once a year. Because of this they need to build higher capacity plants. They pass the cost onto the people. They ratchet the cost based on your individual demand. If you can keep your demand down your demand ratchet is decreased and therefore your demand charge is less. You aren't necessarily saving electricity, you are saving demand charges.