Client has a pharma manufacturing facility on Ameren's secondary voltage Schedule SGS paying $9.40/kW demand. They could take primary voltage service at $7.85/kW but would need about $180K in electrical upgrades. Monthly demand averages 1,850 kW. Anyone run similar numbers on voltage level upgrades?
Primary vs Secondary Voltage - When Does It Pay Off?
Estelle, quick math says they'd save $2,867/month on demand charges alone ($1.55/kW x 1,850 kW). That's $34,400 annually, so roughly 5.2 year payback on the $180K investment. Not terrible if they're planning to stay put long-term and the equipment needs upgrading anyway.
Bernard's math looks right. Also check if there are any energy rate differences between the schedules, and factor in ongoing maintenance costs for primary voltage equipment. Some facilities see additional savings from improved power factor at primary voltage. Worth getting quotes from 2-3 electrical contractors since $180K seems high for a standard service upgrade.
Had a similar decision at a plastics plant last year. The electrical contractor's initial quote was $220K but we got it down to $145K by timing it with their planned maintenance outage. Saved about $38K in lost production costs. Definitely shop around on the installation.
Thanks everyone! Will definitely get more quotes and factor in the energy rate differences. The pharma industry is pretty stable so long-term payback shouldn't be an issue. Claude, great point about timing with planned outages.