How kVA charges work
Your bill has two capacity elements:
- Availability (capacity) charge. A pence-per-kVA-per-day charge on your agreed supply capacity. You pay it every day, whether the plant runs flat out or sits idle over Christmas.
- Excess capacity charge. If your maximum demand in a month goes above your ASC, the excess kVA is charged at a higher rate, usually for that month.
Both sit within DUoS (distribution) charges, set by your regional network operator.
Why so many factories are over-contracted
Capacities are often set when a site is built, or when a line is added, and then never revisited. Production gets moved, compressors and lighting get more efficient, and a shift pattern changes. Actual peak demand falls, but the agreed capacity doesn't. We regularly find sites paying for 30% to 50% more kVA than their highest recorded demand in the last two years.
How to right-size your agreed capacity
- Pull 12 to 24 months of half-hourly data and find your true maximum demand in kVA, not kW.
- Allow sensible headroom for planned expansion and seasonal peaks.
- Check your power factor. A poor power factor raises kVA demand for the same kW, and correcting it can cut both capacity and reactive power charges.
- Request the change from your DNO. Reductions are usually free, but capacity you give up may not be guaranteed if you need it back, so don't cut too close.
If you're regularly hitting excess charges, the reverse applies. A modest increase can be cheaper than paying excess every winter.
What it's worth
Capacity charges vary by region and voltage, but on a mid-sized plant, dropping a few hundred kVA of unused capacity typically saves thousands of pounds a year. It recurs every month, needs no capital spend and doesn't touch production. That's why it's the first lever we check in our audit.
Frequently asked questions
ASC is the maximum load, in kVA, that your network operator has agreed to make available to your site. You pay a daily charge for it whether or not you use it.
If your site's maximum demand in a month exceeds its agreed supply capacity, the extra kVA is billed as an excess capacity charge, usually at a higher rate than the standard capacity charge.
Analyse your half-hourly data to find your true peak demand, correct any poor power factor, then ask your DNO to reduce your agreed capacity to a level with sensible headroom.
Reductions are usually free to request, but capacity you release may not be available again without a new connection application, so leave room for growth.