What is the difference between demand and diversity factors?

Diversity factor is the ratio of the sum of the individual maximum demands of the various subdivisions of a system (or part of a system) to the maximum demand of the whole system (or part of the system) under consideration. Diversity is usually more than one. Demand factor is the ratio of the sum of the maximum demand of a system (or part of a system) to the total connected load on the system (or part of the system) under consideration. Demand factor is always less than one. Demand factor is a percentage by which the total connected load on a service or feeder is multiplied to determine the greatest probable load it may be called on to carry.

Demand factor is the ratio of maximum demand to connected load. It is always less than one. Whereas, Diversity factor is the ratio of individual load maximum demand to combined load maximum demand. It is always greater than one. Greater Diversity factor means smaller will be the cost of generator.