How to cut demand charges at a charging depot
Four levers, in order of what they cost you. Stagger the start times, which is free. Set a hard site power cap, which is a one-time piece of hardware. Run a managed-charging platform, which is an ongoing subscription. Add battery storage, which is a capital project. Most operators skip straight to the third or the fourth, and the first two remove the majority of the peak on any depot whose vehicles sit overnight. Exhaust them before you buy anything.
Updated 2026-08-20

Before any of it: read the tariff
If your site sits on an all-volumetric schedule with no demand component, this entire article is misdirected effort and your money is better spent on energy timing. If your tariff carries a ratchet, the opposite is true and the case for a hard cap gets much stronger, because a ratchet turns a single failure into eleven months of billing.Take the schedule code off the bill, find that schedule in the tariff book, and read the definition of billing demand as well as the rate.
Lever one: stagger the start times. It costs nothing.
The delay belongs in the equipment, not in a routine. Most chargers can hold a start time, and most vehicles can be told to begin charging at a set hour from the vehicle side. Asking drivers to plug in at staggered times works until the first busy week.Staggering has a hard limit that is worth understanding, because it is the reason it is a first step and not the whole answer. Groups cannot overlap, so the number of groups you can run is the window length divided by the time one vehicle takes. In the example below that is twelve hours divided by four and a third, which is two groups. Beyond that you need the ports running simultaneously at reduced power, which is what a cap does.
Lever two: a hard site cap, enforced in hardware
A cap does what staggering cannot: it lets every port run at once at reduced power, which fits more vehicles into the same window than sequential groups do. Total energy divided by the window length gives you the minimum average power the site has to deliver, and any cap above that floor works.It has a second benefit that shows up on the capital side rather than the operating side. Where the relevant editions of NEC Articles 625 and 750 are adopted and the authority having jurisdiction accepts the approach, a service can be sized against the maximum an energy management system permits rather than the sum of the connected equipment. That is frequently the difference between fitting inside the existing service and paying for a new one.The question to ask the vendor, and to test at commissioning, is what the cap does when something fails. A cap that lifts when the controller loses contact with the chargers is not a cap; it is a default.
Lever three: a managed-charging platform
A hard cap is blind. It knows the site total and nothing about the vehicles, so under a tight cap it slows everything equally, including the van that leaves at 04:00 for a long route. A managed platform pulls departure times and state of charge, usually from your telematics, and allocates the same limited power in the order the schedule requires.It earns its subscription in three situations: mixed departure times, vehicles that must leave at a specific state of charge, and more vehicles than ports, where sequencing has to be automatic because nobody is moving cables at 02:00. If your yard is twenty identical vans that all leave at 06:00, a cap does most of the same work for no recurring cost.Price it at the port count you will eventually have, not the one you are installing. Per-port-per-year pricing scales with the build, and a number that looks small against eight ports looks different against forty.
Lever four: battery storage
Storage is the right answer to a peak you cannot move: mid-shift DC charging, a yard where vehicles return unpredictably, or a site whose service is genuinely full and where a line extension is worse value than a battery. It is the wrong answer to an overnight peak that a $2,000 controller would have flattened.Two things decide the sizing, and people usually only think about the first. Power decides how many kilowatts you can shave. Energy decides how long you can shave them for. Shaving 90 kW across a four-hour peak needs 360 kilowatt-hours of usable capacity, and a battery with the right power rating and the wrong energy rating will stop shaving halfway through and let the meter record the peak anyway.The arithmetic that decides whether it pays: kilowatts shaved, times your demand rate, times twelve. At the illustrative $18 per kilowatt used above, shaving 90 kW is $19,440 a year. That figure has to carry the capital cost, the O and M, the footprint, the fire-code and permitting work, and the degradation over the asset's life. We do not publish an installed cost per kilowatt-hour for storage, because we have not sourced one we would stand behind, and a made-up number here would flatter a decision worth six figures.
The order to work in
One thing that is not a lever
Derating the ports permanently means every session is slow whether the yard is busy or empty, which wastes the capacity you own on quiet nights and can push you past the window on busy ones. A site cap lets ports run at full rate when there is room and back off only when there is not.The related mistake is capping below the floor. If twenty vans need 1,000 kilowatt-hours and the window is twelve hours, the site must average 83 kW. A cap of 70 kW does not save you money; it sends vans out short and produces an angry conversation with dispatch that ends with somebody disabling the cap.
Does a time-of-use rate reduce demand charges?
Not by itself. Time-of-use moves the price of energy by hour; the demand charge is a separate line billed on peak kilowatts. Some tariffs do have time-differentiated demand components, in which case shifting your window does help. Read which structure your schedule uses before assuming either way.
Can I just ask drivers to plug in at different times?
You can, and it works, and it stops working during the first busy week or the first shift change. Put the delay in the charger configuration or in the vehicle's own scheduled charging, where it survives staff turnover and a bad Tuesday.
How much can a site cap actually save?
It is arithmetic you can do today: the kilowatts you remove from the peak, times your tariff's dollars per kilowatt, times twelve months. The worked table above shows the shape on an illustrative rate; your tariff supplies the real one, and a ratchet clause makes the saving larger than the monthly figure suggests.
Will capping the site leave a vehicle short in the morning?
Only if the cap sits below the floor. Compute total energy needed divided by the hours available; that is the minimum average power the site must deliver. Any cap above it finishes the job, just later in the night. Any cap below it does not, no matter how clever the software is.
Does solar reduce demand charges?
Only while it is generating. A depot that charges between 19:00 and 05:00 gets no demand relief from a rooftop array, which is why storage rather than solar is the capital answer to a night-time peak. Solar can reduce daytime demand and energy cost, which is a different and often worthwhile project.
Should I do this before or after the chargers are installed?
Before. The cap is part of the electrical design, it may change the service size you need, and retrofitting current transformers and a controller into finished switchgear costs more than specifying them at the start.
- NFPA 70, National Electrical Code — Article 625 (EV supply equipment) and Article 750 (energy management systems). Adopted edition varies by jurisdiction.
- NARUC — directory of state public utility commissions, where tariffs and billing-demand definitions are filed
- Green Button Alliance — Download My Data, for checking your recorded peak after the cap goes in
Two of these levers belong in the install quote
Staggering is a setting. The cap is hardware, and hardware is cheaper to specify now than to retrofit later.