Most plants pay one electricity bill and then guess who spent it. A floor-area split or a fixed percentage keeps the books tidy, but it hides which line, department or tenant actually drove the energy use and the demand peak. Energy cost allocation from sub-metered data fixes that, as long as every number adds back to the utility bill. See a full month worked through in a short allocation demo.
Charge Every kWh and Every kW to the Cost Centre That Used It
iFactory Energy Cost Analytics builds a meter tree from the utility meter down to each asset, applies the allocation rules your finance team signs off and produces chargeback statements that add back to the bill. Gaps, faulty meters and unmetered load stay visible instead of hiding in overhead.
Four Levels From the Utility Meter to the Asset
Allocation starts with a meter tree. The US Department of Energy's Metering Best Practices guide describes a hierarchy that runs from the most aggregate meter down through sub-systems and branch circuits to end uses, and lists cost allocation and tenant billing among the main uses of metered data. Every meter in the tree should have one parent, and the children should add up to the parent, less losses. Map your own tree with our metering team.
Each month, compare every parent with the sum of its children. A gap that jumps from one month to the next usually means a failed meter, a wrong CT ratio or a new unmetered load, not a change in losses.
Metered First, Estimated Only Where You Must
Every allocation method answers the same question: how much of the bill belongs to each cost centre. They differ in how close they come to what was actually used. Metered data wins where meters exist. Estimates fill the gaps, and each one should be written down with its basis so that finance and cost centre owners can check it. Compare methods on your own site in an allocation session.
Losses, Common Areas and the Unmetered Remainder
Sub-meters never cover the whole bill. Some energy is lost in transformers and cables, some feeds shared services such as compressed air, lighting and offices, and some reaches loads nobody metered. In the illustration below, those three together make up 200,000 kWh of a 1,200,000 kWh month. The rule is to keep each slice visible, give it a treatment and set a tolerance. Agree the treatments with our cost team.
Coincident or Non-Coincident Peak, Two Fair Answers
Energy is easy to split because kWh add up. Demand is harder because each cost centre peaks at a different time. Coincident peak allocation splits the charge by each one's kW in the interval that set the bill. Non-coincident peak allocation uses each one's own monthly maximum, whenever it happened. Both add up to the same $60,000 here, from an assumed 4,000 kW at $15 per kW. Work through both methods in a demand review.
Answers Finance Can Trace Back to a Meter
Ask why a cost centre's charge changed and Energy Cost Analytics shows the intervals, meters and rules behind it. Missing data, failed meters and sum-check gaps are flagged before statements go out.
Revenue-Grade Meters, ANSI and MID Classes
If a meter's reading turns into an invoice, its accuracy class matters. ANSI C12.20 defines classes 0.2 and 0.5, accurate to within ±0.2% and ±0.5% of true value at full load, and the 2015 revision added class 0.1. ANSI now lists C12.20 as historical, with its content folded into ANSI C12.1-2024. In the EU, the Measuring Instruments Directive 2014/32/EU sets classes A, B and C for active energy meters, with C the tightest. Choose classes for your own meter tree with our metering engineers.
Current transformers have their own accuracy class, and a wrong CT ratio in the meter set-up is a far bigger error than either class. Check ratios on site when each meter is commissioned.
One Month Allocated and Reconciled to the Bill
The figures are illustrative. Energy is priced at a flat $0.09 per kWh for simplicity, the 200,000 kWh of common load and remainder is spread by metered share, demand uses the coincident peak split above and $2,400 of fixed charges is spread by total kWh. The last two rows must match, or the statement does not go out. Run your own last bill through it in a reconciliation session.
Chargeback Inside the Company vs Billing Someone Else
Splitting cost between your own departments is an accounting choice. Billing another business for electricity can be a different matter. In some US states and utility areas, charging a tenant for metered electricity counts as resale and is restricted or prohibited. Others allow it with conditions, such as charging no more than the utility's own rate or using approved meters. Check the rules where each site sits before you invoice anyone, and ask our support team how statements can be set up for each case.
What a Cost Centre Energy Statement Should Show
A statement that a cost centre owner can check line by line gets fewer disputes than a single number. Use these fields as an energy invoicing template, whether or not software produces it. See a filled statement in a short statement demo.
Eight Checks Before the First Statement Goes Out
Most disputes over energy charges come from set-up, not from arithmetic. Work through these checks with operations and finance before the first month is allocated. Request the full set-up guide from our support team.
Energy Cost Analytics, Meter Connectors and AI Server in One Package
iFactory delivers Energy Cost Analytics as a turnkey bundle. A pre-configured NVIDIA AI server ships racked and ready with the meter connectors, allocation engine and data-quality models pre-loaded, so interval data stays on site. You rack it, plug in power and Ethernet, and the AI is live. To scope it for your site, request a turnkey quote.
- Pre-configured NVIDIA AI edge server, racked and ready
- Connectors for revenue meters, sub-meters and the BMS
- Meter tree mapped from the main meter to each asset
- Allocation rules for common loads, losses and remainder
- Demand charge split, coincident or non-coincident
- Monthly cost centre statements reconciled to the bill
- 24×7 remote monitoring of models and hardware
Server installed, meter tree built, CT ratios checked, interval data flowing.
Two past bills allocated in shadow mode, rules agreed with finance.
Monthly statements issued, cost centre owners and finance trained.
Energy Allocation Software Finance Can Audit
Energy Cost Analytics turns meter data into charges that people can check, question and sign. Our support team can walk you through a pilot plan.
What Plant Managers Ask About Energy Cost Allocation
Every Cost Centre Charged for What It Used
Build the meter tree, agree the rules once and send statements that add back to the bill every month. The full system is delivered turnkey and goes live in 6 to 12 weeks.
