Load factor measures how efficiently your business uses electricity over time. It’s calculated by dividing your average demand (kWh used over a period) by your peak demand (kW) and the number of hours in that period. A high load factor means your usage is steady and consistent, while a low load factor indicates brief spikes in usage and lots of downtime.
Why does this matter? Utilities assess demand charges based on your highest peak draw. If your load factor is low, you’re paying premium demand rates for equipment that sits idle much of the time. Improving load factor – by smoothing out spikes and spreading energy use more evenly – can lower demand charges, reduce wasted capacity and increase overall efficiency.
Want help improving your load factor and lowering demand charges? Contact us today for a free assessment and strategy session.