Why does the PUD charge for Demand?
The Demand charge enables the PUD to recover the costs of maintaining the distribution system.
A customer who sets a high demand requires more services from the PUD, including additional capacity, which means a higher expense for lines, transformers, substation equipment, etc. The PUD uses the demand reading to determine the maximum energy (or maximum capacity) required by our customers.
This information is used to develop a system that will be able to meet the customer’s highest peak demand. Customers may not be using the PUD system at maximum capacity all the time. However, the PUD is still required to maintain the system so that it is ready to provide service to customers at maximum capacity, at any time of the day.