Working on an MLGW account and their ratchet clause language is confusing me. It says "80% of highest demand in previous 11 months" but then has additional language about seasonal adjustments. Anyone familiar with how MLGW actually applies this? Client is on Schedule GSA.
MLGW ratchet clause interpretation
Brenda, it's a large office building with significant HVAC load. Peak demand is typically July/August around 1,850 kW, but winter months drop to 950-1,000 kW. Current bill shows demand charge based on 1,480 kW (80% of 1,850).
Gwen's right about the 80% being favorable. Most utilities use 100% ratchets. Walt, have you looked at whether the building qualifies for MLGW's energy efficiency incentives? Sometimes load reduction programs can help manage those summer peaks.
Donna, that's a great point about the efficiency programs. Walt, MLGW has been pretty aggressive with demand response programs for commercial customers. Might be worth exploring peak shaving options to reduce that summer demand baseline.
Walt, MLGW's ratchet is definitely unique with that 80% factor. The seasonal adjustment typically applies to customers with significant heating/cooling loads. What type of business is your client? That affects how the seasonal provision gets applied.
Walt, that sounds like the ratchet is being applied correctly. For office buildings, MLGW typically doesn't apply seasonal adjustments unless there's a documented seasonal business pattern. The 80% ratchet is actually more favorable than most utilities.