Most utilities allow you to set a – a threshold. If you exceed it, you pay a penalty (e.g., 2× the normal rate for the excess). If your MD is consistently 10% below contract, reduce the contract to save fixed charges.
Because it is highly unlikely that every socket-outlet, air conditioner, and oven will be operating at 100% capacity at the exact same moment, engineers apply a percentage to the total connected load. maximum demand calculation
