Electricity cost savings of R13,700 per month projected for local sheet metal fabricator

By installing a 150kVAr PFC unit, our client’s PF is corrected from 0.73 to 0.98, which will result in projected savings of R13,700 p/m on peak demand costs, yielding an ROI period of ±8 months

RECORDED VALUES

Values recorded during our 7-day on-site Power Factor Analysis:
PF: 0.73
Active Power: 83.96kW
Apparent Power: 114.52kVA 

APPLICABLE RATES

City Power Rates Published March 2021:
Peak demand tariff for Large (LV) Customers per kVA = R257.65 (winter and summer tariff) 

PFC SAVINGS CALCULATION

1. 83.96kW @ 0.73 PF (114.52kVA) = R257.65 x 114.52
= R29,506.07 p/m peak demand charge cost

2. Rectify PF to 0.98 (83.96kW x 0.73 = 61.29kVA) Thus R257.65 x 61.29
= R15,791.37 p/m peak demand charge cost

The monthly savings on the peak demand cost will be:
R29,506.07 – R15,791.37
= R13,714.70 p/m saved

INVESTMENT ESTIMATION

Approx. cost of 150kVAr PFC Unit = R100,000.00 

RETURN ON INVESTMENT PERIOD

R100,000 ÷ R13 714.70
= ROI yield within 7.29 months

After month 8 our client will be saving R13 714.70 p/m on their peak demand charges, which will be money in the bank. These continued savings are subject to the PFC unit running at optimal performance which is achieved through regular maintenance.

BREAK-EVEN ANALYSIS

The graph below illustrates the point in time where this client’s PFC investment cost will be paid off, as well as the continued savings on electricity costs that their PFC unit will provide.

PLEASE NOTE

The above values are based on specific recorded values and rates published by City Power. A power factor analysis, together with a utility bill, will confirm the tariff structure, cost, savings, and ROI, for each individual consumer.