Manufacturing client in Wichita shut down for 4 months during a retooling project. No production, minimal load ? just security lighting and HVAC at setback temperatures. Demand dropped from 750 kW to 45 kW. But Evergy kept billing at the ratcheted demand of 600 kW (80% of 750) for all 4 months. The client assumed that shutting down would eliminate demand charges. Instead they paid $36,000 in demand charges during a period when they used almost no electricity.
Demand ratchet reset after extended facility shutdown
Walter ? the ratchet doesnt care whether the facility is operating or not. It looks at the highest peak in the lookback window regardless of current operations. The only way to avoid the ratchet during a shutdown is to formally request a service disconnect from Evergy. Some utilities will waive the ratchet during a documented temporary service disconnect for facility modifications.
Charles ? they didnt request a service disconnect because they needed power for security and minimal HVAC. Complete disconnect wasnt an option. Is there a middle ground?
Walter ? some utilities offer a seasonal or temporary service reduction where the demand billing is reset without a complete disconnect. In Iowa, MidAmerican Energy has a provision where accounts undergoing major renovation can request a temporary reduction in billing demand if they can demonstrate the load reduction is due to documented construction activity. Check if Evergy has anything similar.
Sharon ? Evergy does have a construction load provision but the client didnt apply for it before the shutdown started. Evergy says it cant be applied retroactively. Going forward I will advise every client planning a major shutdown to apply for construction load status or temporary service reduction BEFORE the shutdown begins.
This is a painful but important lesson. Demand ratchet provisions do not automatically adjust for shutdowns, renovations, or retooling. The time to address ratchet billing during planned shutdowns is BEFORE the shutdown begins. Options to explore pre-shutdown: 1) Temporary service disconnect 2) Construction load classification 3) Seasonal service reduction 4) Contract demand reduction request. All of these typically require advance application. Retroactive adjustments are rarely granted. Walter, make sure this becomes a standard part of your pre-audit client questionnaire ? any planned shutdowns in the next 12 months.