How Business Electricity Bills Work: Energy vs Demand

Most homes pay for electricity one way: per kWh. Businesses usually pay three ways at once, and solar only cuts one of them on its own. Knowing which line is biggest on your bill tells you whether you need panels, a battery, or both.

The three parts of a business bill

• Fixed charge. A monthly or daily amount you pay no matter what. Solar doesn't touch it.
• Energy (¢/kWh). What you pay for each kWh you use. Every kWh your panels make and you use on site comes straight off this line.
• Demand ($/kW). A charge based on your highest draw in the billing period, usually measured over 15-minute intervals. One busy afternoon can set it for the whole month.

Where demand charges start, province by province

• Ontario: small businesses using under 150,000 kWh a year pay regulated time-of-use or tiered prices. Larger Class B and Class A accounts pay the market price plus the Global Adjustment, and distribution demand charges.
• British Columbia: Small General Service (peak under 35 kW) pays energy only. Medium General Service (35 to 150 kW) adds a monthly demand charge; Large General Service pays a higher demand charge and a lower energy price.
• Alberta: it depends on your wire owner. ENMAX and EPCOR don't charge small businesses for demand; FortisAlberta has a 3 kW minimum and some rates use a ratchet, and ATCO has a 5 kW minimum.
• Nova Scotia: Rate 10 (Small General) has no demand charge. Once you use 32,000 kWh a year or more you move to Rate 11, at $9.809/kW of demand.
• New Brunswick: on General Service I, the first 20 kW of demand is free, then it's $14.20/kW. The first 5,000 kWh each month costs 18.21¢, and the rest 13.04¢.

What solar saves, and what it doesn't

Solar reliably cuts the energy line. It's less reliable on demand: a single cloudy peak can set the charge for the month, so panels alone rarely hold it down. That's what a battery or load control is for. On a ratchet rate, such as some FortisAlberta tariffs, shaving your highest peak can lower the demand charge for the next 11 months too.

What to pull before you get a quote

• 12 months of bills, and interval (hourly or 15-minute) data from your utility.
• Your rate class or rate code.
• Whether the business is incorporated and taxable, which decides the 30% federal credit.

Then compare the energy line with the demand line. If energy is the bigger number, start with solar. If demand is, look at a battery or load shifting first.

Sources

• BC Hydro – Business rates
• NB Power – Business rates
• Nova Scotia Power – Business rates
• Utilities Consumer Advocate (Alberta) – Demand charges
• IESO – Global Adjustment

Checked October 2026. Rates and programs change; we confirm current figures on every quote.