Chayathorn Duangtongsuk

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UTILITY RATE STRUCTURES

2-24 List some of the billing rate structures.
ANS Flat Rate
Time-of-Use Rate

2-25 What is peak shaving?

ANS Peak shaving generally refers to leveling out peak use of electricity by industrial and commercial power
consumers. The first purpose of Peak Shaving is to save on the electricity bill. How does peak shaving help to
reduce costs

2-26 What is voltage-based billing? For which group of customers is it used?

ANS Voltage-based billing, certain utility bills will charge less if industrial facility receives power at the
voltage level. Typically, 50,000 volts or higher. In this case, the voltage drop is done by facilities using on-site
transformers. And the customer for this measure is suitable for relatively large industrial plants, as it is possible
to save a lot.

2-27 What is demand billing? For which group of customers is it normally used? Why?
ANS Demand billing is the highest billing of your customers on demand. This is an additional cost in the
electricity bills of industrial users. Demand bills can be up to 20% of the utility bill. And for customers, this
billing applies to industrial users and does not apply to residential or commercial customers because it is
expensive and difficult to validate in such applications.

2-28 What is load factor? Should this value be low or high? Why?
ANS The load factor is the ratio of average facility demand to peak demand over a given period of time,
usually one month. The load factor can be used to determine how a company is handling their peak needs. This
value should be high because the higher this value, the greater the cost savings opportunity through demand
management.
2-29 Define reactive power, resistive power, and apparent power and provide their units.
ANS • Reactive power
The portion of electricity that establishes and sustains the electric and magnetic fields of
alternating-current equipment. Reactive power must be supplied to most types of magnetic equipment,
such as motors and transformers.
• Resistive power
The resistive power is analogous to fuel consumption at a power plant, and it represents the
actual power consumed by the device to carry out the tasks and its unit is kW (kilowatt).
• Apparent Power
In real AC circuits, there is a mix of active power and reactive power. This behavior occurs if
there are lagging or leading loads in the utility grid. The shift between current and voltage is denoted
by the displacement power factor cos φ and its unit is kVA (kilovolt ampere).

2-30 What is power factor? What is its maximum possible value?

ANS Power factor is an expression of energy efficiency. It is usually expressed as a percentage—and the
lower the percentage, the less efficient power usage is. Power factor is the ratio of working power, measured in
kilowatts (kW), to apparent power, measured in kilovolt amperes (kVA). Apparent power, also known as
demand, is the measure of the amount of power used to run machinery and equipment during acertain period. It
is found by multiplying (kVA = V x A). The result is expressed as kVA units. The maximum value of power
factor is one. This occurs in pure resistors where Φ = 0°, [cos0° = 1].

2-31 How can facilities improve their power factor?

ANS The facilities can improve their power factor by installing shunt capacitors, which supply reactive
power locally. These capacitors are very effective in reducing reactive power requirement from the utility to a
minimum. As a result, the power factor approaches unity and the charges by the utility due to reactive power is
avoided.