Large commercial customers typically pay capacity costs -- i.e. if you need 1MW of power, you pay for that 1MW of capacity on top of your actual demand costs.

Large commercial customers typically pay capacity costs -- i.e. if you need 1MW of power, you pay for that 1MW of capacity on top of your actual demand costs. If they did this with residential customers, it would make residential energy storage (i.e. batteries, but maybe thermal or other storage) more attractive, so instead of paying for a 200A circuit to meet your peak demand, you pay for a 50A circuit to keep your home battery charged and that battery kicks in to meet your peak demand. And once you have that battery, you may as well add solar as well.