Avoids over-specifying equipment, which saves on installation costs.
There are generally two ways to approach this: the (based on standards) and the Measurement Method (for existing buildings). Step 1: Identify all Load Groups Categorize your loads into groups such as: Lighting (LED, Fluorescent, Incandescent) Power Outlets (General Purpose Outlets) Heating and Cooling (HVAC) Cooking Appliances Motors and Industrial Machinery Step 2: Apply Diversity Factors max demand calculation
Example: A factory starts a 500 kW motor for 2 seconds – that’s not MD. But if it runs 400 kW for 20 minutes – that likely sets the MD. But if it runs 400 kW for 20
| Purpose | Explanation | |--------|-------------| | | Many commercial/industrial tariffs charge a demand charge (e.g., $15/kW of MD per month) plus energy (kWh). | | Transformer & cable sizing | Prevents undersizing (overheating/trips) or oversizing (wasted capital). | | Generator selection | Ensures backup power can handle the highest sustained load. | | Power factor correction | High MD in kVA indicates poor PF – correction reduces MD charges. | | Load scheduling | Stagger large loads to shave MD and save costs. | | | Generator selection | Ensures backup power