Answer Happy

At AZ-business, a commercial electricity consumer, 3000 kWh is consumed in the month of May with a maximum demand of 30 kW in that month, and with 20% of the consumption being attributed to the peak period. Energy consumption is charged only on the basis of peak and off-peak rates. For this business, the power consumption patterns are identical for all the months of the year, except for the month of June when power demand rises to 120% that of May without affecting the energy consumed. The utility is employing annual billing and applies ratchet-adjustment of 90% on the demand charge. Compare the annual electricity bills for AZ-business with and without demand charge ratchet-adjustment. The applicable electricity rates are as in the table Q1. Table Q1 - Electricity rates Commercial Residential Band 1 Band 2 Up to 400 Above 400 kWh kWh K1.50/kWh K2.00/kWh Off peak Peak Demand charge K2.20/kWh K2.80/kWh K 100/ month-kW