Demand is measured as an average over a 15-minute period, not by the highest moment of electricity use. This means short bursts of electricity, like when an air conditioner or other large appliance starts, have very little impact on your billing demand.
For example, if your home uses 15 kilowatts (kW) continuously for the entire 15-minute period, your billing demand is 15 kW. If that same 15 kW load runs for only 5 minutes during the 15-minute period, your billing demand is only 5 kW because it was used for just one-third of the time.
Remember, billing demand is based on your average electricity use over 15 minutes, not a brief spike in usage.