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Utility Management – Save Money by Understanding the Information

Utility management has become a hot topic over the last several years. While it can be overwhelming to come up with a plan to manage your energy bills, do not despair, it can be done relatively inexpensively. In fact, it may be more reasonable and advantageous than you realize, especially when you factor in the penalties you could be hit with for having a high demand during the summer timeframe.

Kasa Controls and Konnection recently attended GEAPS Exchange 2017, where Syd Panzer from our Konnection division of Kasa Companies, Inc. presented an Educational Session on this very topic. It created a lot of interest and visits to our booth at the show to find out more about it.

It all seems pretty cut and dried, until you dive into and pick apart the details, which is exactly what Syd did. He knew the advantages of managing your energy, but he learned so much more when he started investigating how utility companies charge customers. 

It is a fact that utility companies want you to be “in the know” about your energy and demand. When you’re not, it costs them too as they must update their infrastructure to keep up with demand. It is expensive for them, and those costs are passed on to consumers.

The Basics

Contact your utility provider and ask questions

  • What is my business size classification and what are the associated rates?
  • Is there a tariff minimum or ratchet clause?
  • Is there a penalty or adjustment for lower power factor?
  • How is demand calculated (fixed or rolling)? 

Making Sense of the Information

Once you know all you should know about your business classification and managing your energy, it is important to evaluate your energy performance. This requires good information on how, when, and where energy is being used in your facility. You can actively monitor your power with power monitors and software that helps you look for low power factor and high demand months. 

A lot of people confuse peak power and peak demand, assuming that demand is an “instantaneous power peak”. Demand is the average rate of energy use over time. Generally, power is sampled every one second and averaged over a 15-minute interval. 

Syd and the Konnection team have created a software package to help our customers’ gather and track energy use data over time. The software forecasts the demand for each period, allowing for adjustments to be made before setting a new peak demand and costing them in more ways than just a higher energy bill each month. 

For instance, did you know that once your business is re-classified (i.e., from small to medium) in size, that you must stay at that classification for a full 12 months? Let’s look at the impact of that on your energy bill.

Utility Management Chart

Here’s an example of what happens: Let’s say our facility used 299 kW of demand for the month and 33,000 kWh of usage in the month of February.  If our facility was classified as small, we would have a $22.50 service fee (basic fee).  The demand would be $4.38 per kW times 299 kW which gives us $1309.62 for a demand charge.  Then we get charged about 7 cents per kWh for usage for the first 1200 kWh plus about 5 cents per kWh for the remaining 31,800 kWH.  The usage fee totals $2,448.54 which gives us a grand total on the bill of just short of $3,800.

Now, if we were classified as a medium business, we have the basic $100 service charge, but the demand rate jumps up to $15.61 per kW times 299 kW for almost $4,700 for a demand charge.  That was nearly $1,000 more than our entire bill. The usage charge is a lot smaller of only $481.80, but the demand really hurt us, causing our total bill to be about $5,250 bucks.  About $1,500 extra dollars just for that one month because we were classified as a medium business.  

If you would like to find out more about our Utility Management software, contact us or visit www.konnection.com.