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With the focus on reducing energy consumption, sustainable growth and reduced operating cost I thought it would be a good idea to review power factor.  In 900 words or less, here is the abbreviated explanation.

The power factor of an AC electric power system is defined as the ratio of the real power flowing to the load to the apparent power, and is a number between 0 and 1 (frequently expressed as a percentage, e.g. 0.5 pf = 50% pf. Real power is the capacity of the circuit for performing work in a particular time. Apparent power is the product of the current and voltage of the circuit.

A power factor of one or “unity power factor” is the goal of any electric utility company since if the power factor is less than one, they have to supply more current to the user for a given amount of power use. In so doing, they incur more line losses.

Industrial facilities tend to have a “lagging power factor”, where the current lags the voltage (like an inductor). This is primarily the result of having a lot of electric induction motors – the windings of motors act as inductors as seen by the power supply. Capacitors have the opposite effect and can compensate for the inductive motor windings.

The significance of power factor lies in the fact that utility companies supply customers with volt-amperes, but bill them for watts. The relationship is (watts = volts x amperes x power factor). It is clear that power factors below 1.0 require a utility to generate more than the minimum volt-amperes necessary to supply the power (watts). This increases generation and transmission costs. Utilities may impose penalties on customers who do not have good power factors on their overall buildings.

Watts, or real power, is what a customer pays for. VARS is the extra “power” transmitted to compensate for a power factor less than 1.0. The combination of the two is called “apparent” power (VA or volt-amperes).

A low power factor is expensive and inefficient and some utility companies may charge additional fees when the power factor is less than 0.95. A low power factor will reduce the electrical system’s distribution capacity by increasing the current flow and causing voltage drops.

Consider this popular analogy to clarify the relationship between real and apparent power.  We all know a glass of draft beer generally has a “head” on it. Let’s say your favorite pub institutes a new policy – you only pay for the beer, not the foam. While the foam is just aerated beer, it is not really usable in that form. If the glass of beer is half foam, you pay half the price.  This is the same principle as electricity generation – the consumer only pays for the beer (real power), not the foam. 

The main advantages of the Power Factor Correction are:

•         The electrical load on the Utility is reduced, thereby allowing the Utility to supply the surplus power to other consumers, without increasing its generation capacity.

•         Most of the Utilities impose low power factor penalties. By correcting the power factor, this penalty can be avoided.

•         High power factor reduces the load currents. Therefore, a considerable saving is made in the hardware cost, such as cables, switchgear, substation transformers, etc.

Impact on the Power Utility

The Department of Energy Superior Energy Performance Program in conjunction with ASME has recently completed a Standard for performing energy assessments for process heating, compressed air, steam and pumping systems.  The Pumping System Standard (ASME EA-2-2009) should be available by early March 2010. 

A guidance document was also developed to assist the “specialist” during the pump system assessment process.  Said document provides technical background and application details in support of the understanding and application of ASME EA-2-2009, “Energy Assessment for Pumping Systems.”   The guidance document covers topics such as rationale for the technical requirements of the assessment standard, technical guidance, application notes, alternative approaches, tips, techniques, and rules-of-thumb; and example results from fulfilling the requirements of the assessment standard. 

ASME EA-2-2009 provides a standardized framework for conducting an assessment of pumping systems.  A pumping system includes pump(s), driver(s), drives, distribution piping, valves, sealing systems, controls, instrumentation, and end use equipment such as heat exchangers.  Assessments performed  using the requirements set by ASME EA-2-2009 involve:

• Collecting and analyzing system design, operation, energy use, and performance data
• Identifying energy performance improvement opportunities for system optimization. 

These assessments may also include additional information, such as recommendations for improving resource utilization, reducing per unit production costs, reducing life cycle costs, and improving environmental performance of the assessed system(s).

While this “Standard” and companion guideline is a huge step forward in developing some sort of strcture for pumping systems we are still missing the mark, that is a Pump System Standard for the design and specification of pumping systems.

My compliments to the DOE and ASME, lets keep the momentum and mitigate inefficiences at the source, in the design phase.

What action has your company taken in response to the economic slump? Well, if your like most companies in the United States the normal reaction is to pull back, conserve cash, reduce spending, place all capital projects on hold and carefully evaluate maintenance spending. Is this the right thing to do? Let’s look at the big picture, the down turn won’t last forever, eventually the economy will recover, production will come back, by all indication this may occur within the next year or so. The million dollar question, are you prepared to handle the upturn? Rather then pulling back and restricting projects encourage energy efficiency improvement projects (with the appropriate cost justification). Don’t wait until demand increases, you will be too busy meeting deliveries and the project will again go on the back burner, now is the time to implement such measures. If you feel I am off base think about this:

• As production increase so goes energy demand

• Utilities have delayed building plants

• Transmission projects have been placed on hold

• Many coal fired power plant projects (base load) have been placed on hold or abandoned due

to numerous environmental complaint from special interest groups

So what does this mean? As the economy ramps up and manufacturing return we will see an energy shortage like never before. Utilities have long been concerned about just such an event. Many power companies have less than a 20% reserve margin under normal demand. Imagine the nations manufacturing in full swing and in the heat of the summer (typical high demand period), at our current capacity we would have zero margin and most likely rolling blackouts.

What’s the answer? As I have stated many times there is no silver bullet to our energy crisis, however there are stop gap measures that can protect your company, energy conservation. Implement you projects now, take advantage of the incentive programs available at the state, local, utility and federal level. By delaying project you risk higher implementation cost, possible loss of incentives and higher operating cost. Why wait until your company is in full production? It doesn’t make good business sense to disrupt production and possibly delay shipments, now is the time to evaluate your energy usage and look for ways to reduce long term operating cost.

Another bit of information, your rates will go up remember the utilities have delayed projects too. The net result of these delays, higher material cost, we all pay a higher price in the end.

An excellent resource for energy incentive programs is DSIRE (Data base for State Incentives for Renewables and Efficiency). The time is now!!!!!

 There has been a great deal of activity in the renewable energy sector over the last couple of years, specifically in Wind, Solar, Biomass, Tidal and most recently a resurgance in Geothermal. The question is what is the viability of renewable energy, is it the solution to our energy crisis and most importantly will the power utilities embrace the technology? 

The challenge of renewable energy has been one of technology and economics. Developing technologies that allow us to harness the energy and convert it into electricity. And most importantly (to the utility) doing this at a cost that’s at least equal to or lower than the cost of generating electricity from non-renewable sources.

More than half the states in the U.S. require utilities to get a percentage of their electricity from renewable sources by certain target dates.

Utility scale renewable power generation is developing into one of the hottest energy market segments. The Prometheus Institute reports that worldwide more than $30 billion in investment has been proposed for solar plants to be constructed in the next several years and that up to $200 billion in new investment may be needed through 2020 and this is for solar power.

While the evolving renewable energy industry clearly presents enormous opportunities, attracting the massive level of capital is a major challenge.  The industrial sector, financial community, and utilities have a long way to go to develop a common understanding on how these projects will be financed.  A much deeper understanding is needed for utility scale projects, their risks, risk mitigation, management techniques, and the requisites that will make these projects cost effective.  Communication among all parties will be critical to the success of renewable energy (at the utility level).  The federal government has stepped in with tax incentive programs to promote renewable development.  State and local governments have also implemented incentive programs to encourage renewable energy at the utility level as well as residential and commercial.

Will renewable energy play a role in our future?  Yes.  Is it the ultimate solution to our electric power energy crisis?  No.  For a rational, fact based explanation lets review the advantages and disadvantages of the major renewable technologies.

First a overview of current technology on a operating cost (O&M, Fuel) per kWh basis:

• Nuclear – 2.0 cents/kWh 
• Fossil Steam – 3.5 cents/kWh
• Hydro – 1.0 cents/kWh
• Other Fossil – 5.5 cents/kWh

 Capital cost for conventional power: NOTE – construction cost fluctuate with raw material prices and labor cost

• Nuclear – $5,000/kW (best guess)
• Conventional Coal – $2,500/kW
• Hydro – $800/kW
• Other Fossil – $1,200/kW

Capital cost for renewable energy

• Wind – $1,208/kW
• Biomass – $2,500/kW
• Geothermal – $3,000/kW
• Tidal -
• Solar
  • Photovoltaic – $4,000/kW
  • Thermal – $2,000/kW

Besides capital cost renewable energy has other limitations:

• Capacity, the average wind turbine produces 2MW, the worlds largest solar plant produces 154MW of DC power
• Distribution, with the exception of hydro electric, biomass and geothermal renewable has limited availability
• Limited ROI (return on investment), huge investment with require many years to turn profit, wind, tidal, solar, geothermal have estimated 20 year life
• Transmission, requires additional transmission lines (1.5M per mile)

There are policies and governmental initiatives to promote investment in transmission to support renewable energy.

A significant number of renewable energy generation technologies have reported significant increases in cost due to increases in global raw material costs

Solar thermal generation and solar photovoltaic technology options remain the most expensive.

Renewables have a prominent place in the electric utilities’ plans.  But most renewable energy is not available 24/7.  Some energy source must be available to keep the lights on.

We are all concerned about energy cost and for good reason however it is very difficult to justify a project based on energy savings alone.  There are industries that have little interest in energy cost, power industry and refineries for example.  Power generation is primarily interested in uptime, availability and reliability.  Yes, energy is important especially in a coal fired plant where they continue to add environmental equipment that draws additional auxiliary with no return on investment.  Refineries focus on reliability, they cannot afford to lose a critical piece of equipment during the refining process.

 So why would we discuss reliability and uptime in an energy blog?  Because people are becoming so focused on energy they are losing site of the “Big Picture”.   As I mentioned in an earlier blog, reliability and efficiency are complimentary. 

 Case in point, (6) 5,000hp boiler feed pumps, direct coupled, fixed speed, flow is controlled by the feed water control valve with a minimum flow by pass line sized for 30% of design flow.  The plant is combined cycle merchant that wings load daily, five primary load points, from hot stand-by to full duct fire.  If the plant fails to deliver load on demand the utility is charged a 10 million dollar penalty.  What do you suppose their number one concern is?  Certainly not energy, this project was justified on availability and reliability, energy savings was a side benefit that saved the plant $908,485.00 per year.  Now lets look at additional savings, feed water control valve repair $400K, pump repair $400K, penalty for power disruption $10M.

 There are very few projects that justify themselves on energy savings alone.  It is unfortunate that many viable projects are scrapped because the project was presented solely on energy.   This can be avoided by asking the right questions when targeting a potential project.  This requires the participation of all key players within the plant, maintenance, operations, purchasing, engineering, and production assurance.  If you understand everyone’s issues and concerns it becomes easier to identify and justify a project.

 Look beyond energy savings you might be surprised what you find.  It’s all about the bottom line.

Do you know what you pay per kW/hr, do you know how to read your electric bill?  When evaluating a system for potential upgrade/optimization a key component of the evaluation is energy cost.  In my travels doing energy assessments and system evaluations I was surprised to find that many companies are not aware of what they are paying per kW/hr, a key component in the project justification process.

Higher rates will become a fact of life and will make a direct impact on your companies’ bottom line.  In these uncertain times it is more important then ever that the consumer understand what they are truly paying for electricity. 

Virtually every power company in the United States will use the same basic billing format.  A typical industrial electric bill will include, billing address, electric usage history, rate schedule, power factor adjustment (if applicable), additional facilities charges, account summary, usage information, demand information, metered service charges and amount due.

For the purpose of this “blog” we will focus on the segments of the electric bill that directly impact your bottom line, specifically:

 Electric Usage History

• Rate Schedule
• Power Factor Adjustment
• Additional Facilities Charges
• Usage Information
• Demand Information
• Metered Service charges

Electric Usage History – Compare your electric usage over the past 13 months.  This is important to understand any trending in power usage. 

Rate Schedule – Indicates the electric rate (negotiated rate) for the metered point of delivery

Power Factor Adjustment – This billing adjustment applies if the power factor for the metered services falls below a specified % during the billing period.  The percentage generally ranges from 85% to 90%.  Power factor adjustment may be negotiated with the utility company and may not be applicable in some areas.  However, power factor adjustment can have a huge impact on your energy cost. 

NOTE – Power factor is a calculation indicating how efficiently power is being used.  It represents the relationship of “real” power (kw) which performs useful work in turning a motor, to “apparent” power (kvar) which magnetizes motor and transformer coils.  Motor loads frequently adversely affect the power factor of a circuit, usually from oversized or lightly loaded motors.  Certain other types of loads can reduce power factor.  A low power factor also reduces the capacity of circuit conductors to deliver “real” power and can increase wiring costs as well as electric demand on the utility system.  Most power utilities reserve the right to adjust meter reading kw for billing where power factor is less than 85%.  Capacitors are sometimes connected on the load side of a motor controller to improve the power factor of the circuit.  When this is done, the total kvar connected should not exceed the value required to raise the power factor of the motor to unity when it is running unloaded.  Kw is defined as True (real) Power which is derived from volts times Amps times square root of 3 (or 1.730 times power factor (normally 0.8).  Some folks think kW is measured by Amps times voltage.  Actually the product of this calculation is apparent power or KVA. 

Usage Information – Includes the meter number for the point of delivery (POD), meter readings, days in billing period and total KWh usage.  This is valuable information and must be factored when determining “actual” energy cost.

Demand Information – Includes actual peak kW demand, on peak and off peak demand and peak reactive power (kVAR).  This information allows the customer to calculate actual peak usage (higher cost per kW) and determine when this demand period occurs, allowing “consumer” to perhaps plan operations around this demand period.  Again, this is critical information when calculating true energy cost.   

Additional Facilities Charge – Indicates charges for additional facilities or non-metered services.  This charge may involve dawn to dusk lighting or other types of lighting service.  This cost will generally remain constant however total amount should be verified monthly.

Sample Calculation

 On Peak Kwh + Off Peak kWh + Demand + Facilities Charge = Cost per kWh

                                         Total kWh usage

Don’t be too hasty in answering the question, let’s take a few minutes and look at a few facts, then we can review all of the unsubstantiated facts that seem to be clogging the media and energy industry.

Just the facts:

• We have an aging labor force the lack of skilled experience labor is impacting the mining industry.  Several companies (James River Coal, Massey Energy Co. and Alpha Natural Resources are doling out gas money in hopes of avoiding labor shortages. 

• Demand for coal is growing worldwide, china recently shifted from mostly exporting coal to mostly importing it.  Soaring coal prices and international demand push the coal companies to produce as much product as possible (coal prices and demand have more then doubled since 2007).  Rising wages and expensive new safety regulations have boosted the cost of mining coal.

• Emissions control systems, the average price cost for scrubber systems has gone up 83%, from 250M to 457M in the last couple of years, primarily due to material and labor.  This additional cost will be past on to the consumer.  It should also be noted that the scrubber system provide zero return on investment and reduces the output (net megawatts) of the power plant, in simplistic terms the scrubber is a liability.

• Currently, coal is the most reliable and affordable energy source in the United States.  However, coal –fired power plants produce a significant amount of emissions.

• The U.S Geological Survey has lowered its estimates of the amount of “recoverable” coal in the nation’s largest coal fields

• The nation’s rail freight network (primary source of transportation for coal) is in shambles.  By the year 2035, traffic jams could be so severe trains would grind to a halt for days with nowhere to go.  The nation’s 140,000 mile network of rails devoted to carrying freight (coal) is already groaning under the strain of congestion.  And it’s probably going to get worse over the next two decades.

• The average coal plant consumes 100 to 250 rail cars (100 tons per car)) of coal per day.  Some of this coal is imported and blended with U.S coal

• Coal accounts for 48% of power generation in the U.S. today.  Over the past several years, multiple power producers have announced plans to move forward with construction of a plethora of coal-fired generating units. At the peak of activity, well over 200 new coal-fired generating units were announced. Coal-fired power plants continue to generate a great deal of the energy consumed in North America, especially in the United States, and according to long-range projections, this is not expected to change in the near future. In fact, coal supplies approximately 48% of the electricity generated in the United States. The Department of Energy estimates that by 2030, our dependency on coal will increase to a point that 54% of our electricity will be supplied by this fuel source.

Now for the speculation and unsubstantiated comments:

•  North American coal supply, I have heard estimates ranging from 600 years to 200 years.  Are these number based on current usage or future usage, did they take into account exporting to India and China?

• Despite recent price increases, coal is still cheap compared to other fuels?  For how long?  What other fuels?   Did they take into account renewable energy was Life Cycle Costing factored in?   The price of coal has doubled since last year, largely due to surging energy use in China and India why wouldn’t we assume the cost will continue to rise, making coal cost prohibitive?

• Alternative / renewable energy is expensive (compared to coal).  Wind, solar, bio-mass doesn’t depend on fossil fuels.  Did they consider LCC and projected fuel cost over the life of the plant? 

Our dependency on fossil fuels and resistance to change will eventually bring our economy to a stand still.  It never ceases to amaze me that U.S consumer will rush out to buy the latest and greatest electronic device but fight every inch of the way when our perceived entitlements (utility services) are challenged.  Wake up America the age of fossil fuel is a mere blip on the geological scale, its time to move on.

Is coal or for that matter fossil fuel really King?  You be the judge.

Some very influential people seem to think so.  Wind is a key energy source critical to our power shortage and will play a vital role in reducing our dependency on fossil fuels, but is it really the answer?  Let’s take a look at the big picture, fuel and energy used to generate electricity is only part of the equation, we must take into account transmission, distribution, sustainability as well as public sentiment.

It seems everyone has a “Pet” energy source that is going to solve our energy crisis be it nuclear, wind, coal, natural gas, solar or bio-mass.  If we step back and take an objective look at what is going on in the world today perhaps we can make sense of the world (not just North America) energy crisis and come to a rational solution to this global issue. 

I’m going to go out on a limb here and make a broad statement, most Americans react only when a situation is in crisis mode or when it directly impacts their life style.  We go into panic mode and look for a quick fix, hence the single energy source solution.  In order to resolve this world wide problem (think global) we need to look beyond current technology.  Existing technology does not fit our future energy needs.  Does it make sense to continue building massive coal fired power plants when we do not have the rail capacity to deliver the coal or the capability to control emissions?  Not to mention public sentiment, there are quite a few environmental groups that will respond with a resounding no.  The same can be said for nuclear, while nuclear is emission free we still have special interest groups that feel nuclear power is dangerous.  Other special interest groups appose wind because of the noise, danger to birds and general appearance.  I can go on and on with other energy sources, no matter what some special interest group will have reason to object (that is their right).

Reality check, we are in a crisis situation and we still can’t seem to agree on a primary energy source.  A few people have offered up “conventional / singular” solutions all of which have come under fire.  The longer we wait the greater the impact on our economy.  Other countries are moving forward with solutions right or wrong, they are committed to meeting their countries need for additional power generation.  In my humble opinion we have “too many cooks in the kitchen” and we are not thinking beyond current conventional power generation technology.   

Is the answer blowing in the wind?  Only part of the solution lies in wind, the remainder will/should be a mix of other energy sources, some renewable, fossil, biomass and nuclear.  It makes little sense to gobble up our natural resources simple because it’s there, plentiful and perceived to be inexpensive.  This is short sighted thinking, smaller localized plants using renewable and bio fuels can make up a bulk of the power needs.  Main line generators can be used for the load cell regions of the country.  Wind is a key player but not the ultimate solution to our energy crisis.  Until we as a nation agree on the recipe we will be hard pressed to stabilize our economy.   

Sustainability is the biggest opportunity and challenge that industry faces.  Developing a strategy to take on sustainability is vital for the long term survival of industry. The motivation for industry is clear however the change in thinking required and the associated challenge for industry is significant. How can industry get past first cost and the paralyzing fear of change?  One thing we can’t get past is rising energy cost.  Since 1999 average energy rates have increased 50% for industrial and 30% for commercial businesses in the Northwest, other regions of the U.S. have experienced similar cost increases. 

The U.S. power industry must build at least 150 gigawatts of new generating capacity to meet electricity demand by 2030, at a cost of about $457 billion, according to preliminary findings of a new study being prepared by the Brattle Group on behalf of the Edison Foundation.  An additional $900 billion will need to be invested by 2030 in transmission and distribution facilities to modernize the national grid.  The additional capacity and transmission will come at a significant cost to the customer.  We have established this fact in my earlier blogs.

Three-fourths of U.S. electricity–69% of which is used in buildings, nearly all the rest in industry can be saved for less than the price of just running a coal or nuclear plant. This energy potential is not just in smarter motors, lights, appliances, etc., but even more in their larger systems. For example, three-fifths of the world’s electricity runs motors, and half their shaft power runs pumps and fans. Designing friction out of pipes and ducts can save 10 times as much fuel at the power plant and sizing equipment properly can save even more.

While it is important to negotiate the best price per kW/hr for electricity investment in energy efficiency is not only about obtaining the cheapest source of new power for business.  Cost savings through energy efficient systems, waste reduction, reduced risk, and increased workforce productivity will allow industry to achieve sustainability. Unfortunately many companies still focus on reducing staff, eliminating or reducing planned maintenance and in some cases run equipment to failure, all for the sake of increasing stockholder value.  This is a huge misconception that must change in order for U S industry to prosper.  Eventually equipment must be maintained, catastrophic failures typically cost more than a standard repair any perceived savings is eliminated when the equipment fails.  So who wins?  Maybe the pump repair shop but certainly not your company.

For the skeptics there is a very compelling business case exists for investment in energy efficiency.  According to the NPCC’s 5^th Power and Conservation Plan, costs associated with energy efficiency average about 2.4 cents per kW/hr.  I challenge anyone to come up with a better return on investment.

The U S Department of Energy Superior Energy performance Program is asking for 25% reduction in energy intensity (a measure of energy consumption per dollar of real gross domestic product) by the year 2017.  By working smarter, using the latest technology, thinking beyond 1^st cost and controlling your systems we can achieve the desired energy reduction. 

Don’t forget to think beyond energy savings, in many cases by optimizing the design of a new pumping system it is possible to lower construction cost and achieve better performance, the best of both worlds.

Sustainability through energy conservation is the best solution for our country.

Reference:  The Case for Efficiency by Amory B. Lovins

                    Energy Efficiency is Pro Business by Kevin Wilhelm

We are living in dangerous times, no I’m not talking about hostilities with other countries I’m referring to making the wrong decisions when specifying new equipment or system upgrades.  Failure to consider all options could be a fatal mistake, for example, sticking with the old tried and true specifications your company has been using for the last 50 years.  You know what I’m talking about, the typical fixed speed oversized pump coupled to an oversized motor with a 1.15 service factor bolted to oversized piping (future capacity).  Yes I sound like a broken record I’ve already mentioned this in previous blogs.   It’s worth repeating we need to dispense with the status quo.

Now let me throw out a new catch phrase “OPSOP” other wise know as “Optimum Pumping System Operating Point”.  This term was developed and coined by a well respected member of the Hydraulic Institute.  What is “OPSOP”?  Simply stated it is the pump operating point, which when combined with the optimized pumping system yields the absolute lowest cost.  Did I get your attention?  Lowest cost!!!

On a new pumping system you have three variables that affect the system initial and recurring cost:

Pump

•         Operating points have costs by choosing different pumps the pump curve can be adjusted.  The pump efficiency and BEP also adjust.  The pump curve can also be changed by changing the impeller size or (fixed) speed.

Control and Operations

•         The pump curve can be adjusted using variable speed control.  The system curve can be adjusted (to a limited degree0 by decreasing pressure drop across high pressure drop components

System

•         The system curve can be adjusted by using different pipe sizes, layout,  pipe material, and components

For existing system cost reduction, opportunities are typically focused on the first two.  Changes to the system are typically not cost effective.  Opportunities typically reside in changing the pump curve i.e. repair pump, impeller size change, controls (VFD) or a new pump.

Doesn’t this make more sense then following the same inefficient methodology that has been in place for the last century?  It’s time to step out of the “box” there are better ways to design new and upgrade existing pumping systems.  Your companies’ bottom line depends on cost effective, energy efficient systems the status quo is not the solution.

For more information on System Optimization and “OPSOP” go to www.pumps.org and purchase “Optimizing Pumping Systems a Guide for Improved Energy Efficiency, Reliability and Profitability”.