is the amount of something that is used at a variable rate
which is consumed when the usage is highest.
For instance, in the summer people use more electricity during the hottest parts of the day (for air conditioning and such) than they do late at night. The important thing is that power generation capacity be greater than peak usage.
This concept applies to many things besides electricity. Comparing the number of tellers at a bank to the average number of customers per hour and calculating average transaction times is not sufficient to determine if the bank has enough staff.