Common use of Demand Charge Clause in Contracts

Demand Charge. 4.1.1 When Emergency Reserve Capacity is provided there will be no demand charge. If the Party suffering the outage requires assistance for a longer period than the Emergency Period, then that Party will purchase Daily Reserve Capacity, unless otherwise mutually agreed. When Daily Reserve Capacity is provided, the receiving Party will pay the delivering Party a reserve Demand Rate per kW per day not to exceed the rate calculated in accordance with Appendix A or B, whichever is applicable. 4.1.2 In the event the delivering Party provides capacity to the receiving Party from a third-party system, the receiving Party will pay the delivering Party a Demand Rate equal to (1) the Demand Rate charged by the third-party, plus (2) a Transmission Use Rate per kW per day not to exceed the rate calculated in accordance with Appendix A or B, whichever is applicable. In transactions where no demand charge is made by the third-party, the receiving Party will pay the delivering Party a Transmission Use Rate per kW per day or per kWh, whichever is less, not to exceed the rate calculated in accordance with Appendix A or B, whichever is applicable.