LEARN / GLOSSARY
Load factor
Average demand divided by peak demand across a period. It distinguishes a facility that runs continuously from one that draws hard for a few hours, and it explains why two loads of identical size impose different costs on a system.
Definition
Load factor is the ratio of average electrical demand to maximum demand over a period, usually expressed as a percentage. A load that never varies approaches one hundred percent. A load concentrated into summer afternoons sits far lower, because the capacity built to serve its peak stands largely idle the rest of the year.
Why the dictionary version is insufficient
Load factor is often filed as an efficiency metric, which suggests higher is better for the customer. It is more useful as a description of what a customer costs the system to serve. High load factor loads consume more energy and are easier to plan for. Low load factor loads consume less and require capacity that earns nothing most of the year.
Why it matters for capacity
Industrial and data center loads typically run at high load factor, which is why a gigawatt of new industrial demand is a different planning problem from a gigawatt of residential peak. It also means the energy consequences of industrial growth are larger than the peak figures alone suggest.
Related terms
Large load · Firm power · Capacity factor
Appears in
How Electricity Demand Is Measured
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How Electricity Demand Is Measured