Just got word that CPS Energy is restructuring their primary voltage discounts effective January 2019. Currently getting 6% on Schedule PL for 12kV service, but they're moving to a tiered system. Customers with power factor above 0.98 get 8% discount, 0.95-0.98 gets 5%, below 0.95 gets only 2%. Anyone else hearing about similar PF-based voltage discount structures?
CPS Energy Primary Rates - Major Changes Coming
Angela - TXU here in Dallas implemented something like that in 2017. It's part of their grid modernization push. Higher PF customers create less reactive power burden so they get better discounts. We've been advising clients to install automatic capacitor banks to hit that 0.98 threshold. The ROI is usually under 12 months.
Georgia Power rolled out similar changes last year. The frustrating part is PF varies throughout the day and seasons. We had one client get penalized because their PF dropped to 0.94 during a three-day maintenance shutdown when only lighting loads were running. The averaging period matters - monthly vs daily vs real-time.
Derek - that's my concern too. CPS uses monthly averaging which should help with short-term variations. Marcus, what kind of capacitor bank sizing did your Dallas clients use? We're looking at about 800kVAR for a 2.2MW load but not sure if that's overkill.
That sounds about right for 2.2MW. Rule of thumb is roughly 400kVAR per MW for most industrial loads to get from 0.85 to 0.98 PF. Consider automatic switching banks so you don't over-correct during light load periods. Leading power factor penalties can be even worse than lagging.
Georgia Power here in Savannah has been really aggressive about PF enforcement. We had a textile plant get hit with $8,000 in penalties last month for running 0.89 PF. The new smart meters make it impossible to hide poor power factor like the old days. Automatic correction is becoming mandatory, not optional.
Rocky Mountain Power in Utah just announced similar changes. Primary customers will need 0.97 PF minimum starting next year to keep voltage discounts. The challenge for us is convincing clients to invest in power factor correction before they see penalties. It's always reactive instead of proactive.
Connie - exactly the same problem here. Clients don't want to spend $50k on capacitors until they get hit with penalties. By then they've already lost thousands in discount reductions. The business case is solid but the timing is always wrong from their perspective.
TEP in Arizona has had PF-based discounts for years. One trick we use is showing clients the monthly trend over 24 months. Most loads have seasonal PF patterns they don't realize. Summer cooling loads often improve PF while winter heating can make it worse. Helps size the correction properly.
TVA wholesale customers in Tennessee are seeing similar requirements trickle down from distributors. Knoxville Utilities Board just updated their primary tariff with 0.98 PF requirement for maximum discount. The trend is definitely spreading nationwide as utilities focus on grid efficiency.
Update - just reviewed CPS's final tariff filing. The 0.98 PF threshold for 8% discount is confirmed. They're also adding a new 69kV delivery class with 12% discount for really large customers. Minimum 10MW load requirement though.