Windows Server Backup - Not using all destination space

I administer a very small environment on the side. I am using Windows Server backup on a QNAP iSCSI target as the local destination with Azure as a cloud backup (immutable).

The local backup is using 1336GB out of 1999GB, resulting in 18 copies. I am using Performance (VSS). Why isnt using more of the destination space? I am having trouble finding logs and such to look at.