What is Peak Demand?

September 6, 2021                                                                                                                                        Home

When reading about your electric bill, the words “peak demand” are often mentioned.
So, what is peak demand? Understanding peak demand is very important, as it has a
direct effect on what we pay on our electric bill each month.

We understand that there are many ways to save money on your bill – turn lights off when not in use, use LED light bulbs rather than standard bulbs, buy a more efficient refrigerator or drier when you need a new one. All of these actions help and can save
you money on your individual power bill.

However, the idea behind peak demand is that all of us together pay attention to when we use electricity. If you think about your daily life, most of us get up in the morning about the same time for school and work. In the late afternoon and evening, most of us return home, prepare a meal, take a shower, and get ready for the next day.

The season of the year has an impact on electricity use (heating or cooling). Yet, at any time of the year, between the hours of 6 am and 8 am and then between 3 pm and 7 pm, there is a greater demand for power in the home. These are peak demand times
for electrical use.

Why is this important? Powell Valley Electric Cooperative buys its power from TVA. At times of peak demand, the charge to PVEC from TVA is higher than at other times, as TVA needs to generate more power to supply all its customers (cooperatives, public utilities). To quote from the July issue of Tennessee magazine, the “demand charge is based on the single hour each month that our demand for power is at its highest.”

So, yes, do what you can to reduce energy use at home. However, if all of us can reduce our home electrical usage during these peak hours (change thermostat settings, do laundry at non-peak times, avoid using dishwasher, reduce usage of electric stoves), everyone will benefit with lower electric bills.

Everyone needs to learn more about our electric cooperative. For more information, go to pve.coop.

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