What does a demand charge mean?

Demand charges are based on the amount of power a user could potentially use. These extra charges are often determined by the local utility provider, based on the peak power drawn by a facility over the previous year, and are assessed each month as a part of the utility bill.  Commercial buildings and factories can see demand charges that comprise 30 to 50% of their monthly bill!  So naturally, a user will want to minimize these charges by avoiding very high peaks in their power usage. An EnergyAware system can perform peak-shaving operations to flatten those power peaks.