Auto assembly plant in Detroit on DTE Schedule D-1.1 getting hammered with power factor penalties. Running about 0.73 PF and paying $3,200/month extra. Plant has lots of motor loads but no correction equipment. What's the typical payback on capacitor banks for something this size?
Power factor penalties killing this auto plant
At $3,200 monthly penalty, you're looking at 12-18 month payback on capacitor correction. Auto plants respond really well to PF correction because of all the motor loads. Target 0.95 PF and the savings will be immediate. Just make sure to size it right - overcorrection can cause voltage issues.
Omar's right about the payback. Had a similar situation at a Ford supplier in Dearborn. $85K investment in capacitors, saving $4,100/month in penalties plus some demand reduction. ROI was 20 months. DTE also has rebates for power factor correction that can help with upfront costs.
Great advice from both Omar and Stuart. One caution - make sure the electrical contractor understands industrial PF correction. Seen too many installations where residential-grade equipment failed quickly in industrial environments. Use heavy-duty capacitors rated for the harmonic environment you'll find in auto manufacturing.
Thanks everyone! Getting quotes from three contractors now and checking on DTE's rebate program. Plant manager is finally convinced after I showed him we're basically throwing away $38K per year. Sometimes you have to put it in those terms.