DCP161 scaremongering – What is ‘excess capacity’ all about?

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We have heard that some energy consultants are calling people telling them that their electricity costs will rise due to DCP161. Most of the time, you don’t have to worry.

If you have a half-hourly meter, you will probably have an item on your bill called ‘available capacity’ or ‘maximum demand’. This is the peak power load that you are expected to draw from the grid. The local electricity distributor (which is not the same as your energy supplier) will charge you a monthly fee based on that peak demand, usually at a rate of about £1 per kVA per month. Previously, if you exceeded the maximum, you were just charged the extra bit at the same rate. 

What has changed with DCP161 is that the excess rate can now be up to 3 times higher, in the region of £3/kVA/month. This isn’t that scary, as shown in the following example:

If your maximum demand is set at 120kVA, and you exceed it by drawing 125kVA during the month, the excess charge will be 5kVA x £3/kVA = £15. Remember, you would have paid £1 per kVA anyway, so the difference is maybe £10. 

Obviously, if your maximum demand figure is massively out it can cost you more, but it’s really not as bad as some make out.

If you would like some cool-headed advice about your energy bills, get in touch.