A demand factor is the ratio of maximum demand to total connected load, expressed as a percentage. Not all loads operate simultaneously — a demand factor of 50% means peak usage is only half of the total connected capacity. NEC provides mandatory demand factors for specific load types: lighting (Table 220.42), cooking equipment (Table 220.55), dryers (Table 220.54), kitchen equipment (Table 220.56). Applying demand factors reduces the calculated load below the sum of all connected devices, which directly reduces transformer and service entrance sizes — often saving thousands in equipment costs.

Per NEC 210.19(A)(1), 215.2(A)(1), and 230.42(A)(1): conductors and overcurrent devices must be sized at 125% of the continuous load (loads expected to operate for 3+ hours). A 20A continuous load requires a 25A-rated conductor and a 25A or larger breaker. This factor applies ON TOP of demand factor calculations — first apply demand factors to get total demanded load, then apply 125% to the continuous portion. Non-continuous loads are added at 100%. Total sizing = (continuous × 1.25) + (non-continuous × 1.00).

Group loads by NEC category: (1) General lighting per Table 220.12 VA/ft², (2) small appliance circuits at 1,500 VA each per 220.52, (3) fixed appliances at nameplate rating, (4) motor loads per Article 430 (largest at 125%, others at 100%), (5) HVAC per 220.60 — use larger of heating OR cooling, not both. Apply specific demand factors per category. Sum all demanded loads at each panel. For multi-panel systems, repeat at each hierarchy level. The total demanded load at each point determines feeder/transformer size.

Connected load is the arithmetic sum of all nameplate ratings (e.g., 150 kVA total). Demand load is the calculated peak that will actually occur simultaneously after applying demand factors (e.g., 95 kVA after factors). Real-world peak demand typically falls between 50-80% of connected load for commercial buildings and 30-50% for multi-family residential. Service entrance, feeders, and transformers are sized for demand load — using connected load would result in dramatically oversized (and expensive) equipment.

Industry best practice: 20-25% spare breaker positions in panelboards (ANSI/NECA 1 recommendation), 15-20% spare capacity in feeders and transformers, 25-40% spare conduit fill for future conductor additions. For speculative commercial spaces (shell buildings, tenant fit-up): size service and distribution for 125% of initial tenants plus 10-20% future. Data centers: plan for 3-5 years of IT load growth at 15-25% annually. The cost of oversizing during initial construction is far less than retrofitting — service entrance upgrades typically cost 5-10× the original premium for additional capacity.

List all single-phase loads and their VA ratings. Assign to phases A, B, C such that total VA per phase is within 10-15% of average. Three-phase loads automatically distribute evenly. Tool: create three running totals; assign each new circuit to the lowest-total phase. For panels with many single-phase circuits, use a spreadsheet to iterate. Phase imbalance increases neutral current — excessive imbalance can overload the neutral conductor. For wye-connected systems with triplen harmonics, neutral current exists even with perfect phase balance.

The load schedule feeds the short-circuit study (determining available fault current at each panel), which feeds the arc flash study (determining incident energy at each panel). Changes to the load schedule — adding motors, upgrading the service, paralleling transformers — can change available fault current and therefore arc flash hazard levels. NEC 110.16 requires arc flash labels on equipment, and those labels must be updated when modifications affect the hazard. A properly maintained load schedule is the starting point for keeping arc flash studies current.