What is the difference between kWh and kW

What is the Difference Between kWh and kW?

A kilowatt-hour (kWh) and a kilowatt (kW) may sound similar, but they’re actually quite different.

While both are interrelated units of measurement, the important distinction between kWh and kW is that a kWh reflects the total amount of electricity used, whereas a kW reflects the rate of electricity usage.

Technically, the difference is that a kWh is a measurement of energy, while a kW is a measurement of power; however, the terms power and energy are often mistakenly used interchangeably. Energy refers to the ability to do work - power refers to the rate of energy production or consumption. To really understand kWh and kW, you also need to consider time.

In order to quantify the actual amount of electricity consumed, there needs to be a period of time in which that rate occurs. 1 kWh equals one hour of electricity usage at a rate of 1 kW, and thus the 2 kW appliance would consume 2 kWh in one hour. The equation is simply (kW x Time = kWh).

The Significance of kWh and kW

Why does the difference between a kWh and kW matter for businesses? While it seems like a scientific differentiation, paying attention to these measurements can lower your energy bills.

Most utilities bill customers for total kWh energy consumption and peak kW power consumption. Knowing when, and at what rate energy is consumed, allows customers to manage and reduce electricity costs.

Suppose that the electricity rate for commercial customers is 12.22 cents/kWh and $15.45/kW during peak hours. A 2 kW appliance that ran for 100 hours in a month would equal 200 kWh and therefore cost $24.44 in kWh consumption charges and $30.90 in kW demand charges. That’s why it can be beneficial to use devices that consume electricity at a lower rate. If that appliance ran at a more efficient 1-kW rate, the total cost would be cut in half, assuming it ran for the same amount of time.

However, a lower kW device may not always function the same as a higher kW one. It would have to run for longer periods of time during high-cost periods in order to generate the same amount of energy.

LED light bulbs can run at a lower wattage for the same amount of time as a higher wattage device like an incandescent bulb because an LED bulb does not let as much energy escape (as heat) and requires less energy to have the same lighting capabilities.

Artis Energy’s RTIS® energy analytics platform can help you monitor these measurements and get insights into determining the right balance between wattage and time to ultimately lower utility costs.