It is essential for any power utility to provide sufficient energy enough for all the loads connected to the system. To achieve this, the generation and distribution system should be equipped with instruments to determine the maximum demand of consumers at all times. This can be done by the instrument called Maximum Demand Indicator (MDI). This blog describes the applications, pros and cons of different types of MDIs and the significance of calculating maximum demand.
The greatest power demanded by load on the power station during a given time period is called maximum demand.
The demand charge for a given month is determined by the given formula:
Electricity billing structure by the utilities is usually composed of a two-part tariff structure, one part depends on the actual energy drawn (kWh), while other depends on the power demand (kVA or kW) during the billing cycle. Electric power suppliers charge commercial and industrial consumers such as industry, office buildings, hospitals etc. on the basis of maximum demand and total unit consumption. However, the residential customers are charged just for the “actual” energy (kW) used and not the “total” energy (kVA) supplied. With the increasing trends of energy conservation and cost saving, it is important for any consumer to understand the electricity tariffs.
Generally, utilities impose different demand charges for Peak and Off-Peak hour based on electricity billing structure. Let us explore the calculation of demand charges by an example.
|Time of Use||Time||Charges|
5PM - 9PM
Off peak time
remaining 20 hours
Customer’s maximum demand during peak hours = 400 kW
Maximum demand during off-peak hours = 150 kW
Demand charges would be calculated as:
On-peak Demand: 400kW * 15.78 Cents = 6312 Cents
Off-peak Demand: 150kW * 13.07 Cents = 1960.5 Cents
Total Demand Charges for the month = On-peak Demand + Off-peak Demand= 6312+1960.5
Total Demand Charges for the month = 8272.5 Cents = $ 82.725
Now assume another case in which peak demand is reduced during both on and off-peak hours:
Customer’s maximum demand during peak hours = 150 kW.
Maximum demand during off-peak hours = 300 kW.
Demand charges would be calculated as:
On-peak Demand: 150kW * 15.78 Cents = 2367 Cents
Off-peak Demand: 300kW * Cents. 13.07 = 3921 Cents
Total Demand Charges for the month = On-peak Demand + Off-peak Demand= 2367+3921
Total Demand Charges for the month = 6228 Cents = $ 62.28
In the above example, we can observe a significant reduction in utility bill cost. Hence, we can conclude that when maximum demand is increased, higher will be the charges. There is need to reduce our maximum demand which is indicated by maximum demand indicator. So, maximum demand indicator holds great significance for utilities and consumers.
The importance of maximum demand lies in the fact that it helps in determining the installed capacity of the station and cost of installation. Higher the value of maximum demand on the station, greater will be the size and cost of installation. As the station capacity is optimized to meet the maximum demand. Now, low maximum demand means low capacity of the plant which, therefore, reduces the cost of the plant. Further, the tax charge and clerical staff depends upon the size of the plant and consequently, depend upon maximum demand.
Maximum Demand indicator is a device which records the maximum power used by the consumer at intervals. The indicator should only measure the base and peak load value not the high current values due to sudden short circuit or inrush current.
Following are the Types of Maximum Demand Indicators:
Wright MDI is basically a thermal indicator operated by current. It works on the principle of differential thermometer. It is made up of U-shaped glass tube with two bulbs at upper ends of tube. The left side bulb consists of an air and metallic strip around it which is then connected with the load circuit in series. Beneath the right-side bulb, a scale is fitted along with a narrow bore Index tube. The main U-shaped tube is filled with dilute sulphuric acid, having low co-efficient of thermal expansion at low temperature. The traps in each limb prevents the movement of air from one bulb to the other.
The air inside the bulb expands when the load current flows through the strip. This expansion causes the indicator liquid of right-hand bulb to spill over into the index tube. The expansion of liquid highly depends on the magnitude of load current across the strip of the indicator. Thus, higher the magnitude of load current, the greater will be the expansion of liquid, and as a consequence, higher will be the quantity of liquid overflowing into the index tube. Now, the overflow of liquid will happen only when the load current through the strip exceeds the previous load current value.
For such indicator, time lag must be incorporated to prevent indication of peak demand of short duration. This time delay is increased by placing cast iron cylinder between bub and metallic strip (heater coil).
Merz Price Indicator is integrated with the energy meter which measures total energy consumed at particular time interval. The indicator records the maximum demand through a complex speed dial mechanism. Pointer connected to Merz demand indicator is driven by disc mechanism of energy meter using some gearing mechanism. Then, pin moves the dial forward which indicates the total power consumed at particular interval. For the next time interval, pointer will record the total power consumed by the load. The pin will move forward only when energy used by the load exceeds the previous recorded value. The indicator consists of cam and Bell crack mechanism, used to reset the pointer at initial position.
Merz Price indicator lies under the category of Average Demand Indicator as it shows the maximum value of the load averaged over equal time interval. The mathematical expression to calculate Average Maximum Demand is given as:
Merz Price Indicator is of ultimate importance in Energy measurement field and is used as a unit together with an energy meter.
Once consumer specify the MD (Maximum Demand) needed during the month to utility, electric power supply company setup the generating station based on MD by load side. In an electrical system, an increase in the demand for electricity by more diverse end user leads to shortfall in capacity to meet demand. To keep up with energy demands, the construction of new generation power plants are costly as well as a long wait prospective. So, utility imposes a penalty on consumer if MD value during the month is higher than the contracted demand. This penalty is accounted in their electricity bill and is termed as MD Penalty.
MD penalties are incurred by utility because of exceeding the contracted power can be reduced by practicing the following methods:
👉🏼 We previously wrote a blog on Power Factor. Go through the article to get more information about power factor correction techniques.
Better load management on the user side minimizes the peak demands on the utility infrastructures, thus improves the utilization of power plant capacities. MD controllers, MD panel and power controller can be used to limit the average power consumption to a contracted power (pre-determined maximum value). MD controllers for load management during peak hours curtail the non-vital loads when the demand exceeds the pre-defined load limit.
As MD contributes to the considerable portion of the electricity bill cycling, to effectively control the maximum demand during the month, there is a real need of integrating Power Demand Controller. The gap of supply and demand have compelled power engineers to develop techniques for Demand Side Management (DSM) and Load Management such that utility and consumers can make the most of electric energy. MD controllers based on novel techniques have been implemented and proved that managing loads on peak hours increases the reliability of power system by lowering the power cuts.
About The Author
Abdur Rehman is a professional electrical engineer with more than eight years of experience working with equipment from 208V to 115kV in both the Utility and Industrial & Commercial space. He has a particular focus on Power Systems Protection & Engineering Studies.