The costs of poor power quality

Productivity is the key to survival in today’s globally competitive environment. When the basic inputs to production including time, labour and materials are considered, there isn’t much room for optimisation. Organisations operate 24 hours per day, labour is costly and choice in materials is limited, which means every company must use automation to gain more output from the same inputs, or perish. Organisations that rely on automation need to ensure continuous operation.

Power quality problems can cause processes and equipment to malfunction or shut down and the consequences can range from interrupted production to complete work stoppage.

Obviously, power quality is critical. The interdependence of various systems adds layers of complexity to power quality issues. An organisation’s computers might be fine, but if a network is down then email and other critical applications might not work. Likewise, a manufacturing process might be operating correctly, but if the HVAC shuts down then production must stop. Mission-critical systems exist throughout most facilities and power quality problems can bring any one of these to a grinding halt at any time. And that will usually be the worst possible time.

Most power quality problems originate inside a facility. They may be due to problems with:

• Installation - improper grounding, improper routing or undersized distribution
• Operation - equipment operated outside of design parameters
• Mitigation - improper shielding or lack of power factor correction
• Maintenance - deteriorated cable insulation or grounding connections

Even perfectly installed and maintained equipment in a perfectly designed facility can introduce power quality problems as it ages.

The direct measurement of waste due to poor power quality can be achieved with power quality instruments, which directly measure waste due to harmonics and unbalance, and quantify the cost of that waste based on the unit cost of power from a power supplier.

Power quality problems can also originate from outside the facility. Organisations live with the threat of unpredictable outages, voltage sags and power surges. Obviously, there’s a cost here, but how do organisations quantify it?

Measuring power quality costs

Power quality problems make their effects felt in three general areas - downtime, equipment problems and energy costs.

Downtime

To quantify system downtime costs, you need to know two things:

1. The revenue per hour your system produces.
2. The costs of production.

Organisations must also consider the business process:

• Is it a continuous, fully utilised process - for example, a refinery?
• Must the product be consumed when produced - for example, a power plant?
• Can customers instantly switch to an alternative if the product is not available - for example, a credit card?

If the answer to any of these questions is yes, then lost revenue is difficult or impossible to recover. If organisations can’t deliver there is a risk that customers may switch to a source that can.

Let’s walk through an example: A factory makes 1000 widgets per hour and each widget produces $9 of revenue. Revenue per hour is $9000. If the costs of production are $3000 per hour, the operating income is $6000 per hour when production is running. When production is down, the factory loses $6000 per hour of income and still has to pay fixed costs such as overhead and wages. That’s what it costs to be down. But, downtime has other costs associated with it including:

• Scrap - how much raw material or work in process has to be thrown away if a process goes down?
• Restart - how much does it cost to clean up and restart after an unplanned shutdown?
• Additional labour - does overtime need to be paid or work outsourced to respond to a downtime incident?

Equipment problems

Exact costs are hard to quantify, because organisations are dealing with many variables. Organisations may be faced with problems such as whether a motor really failed from excess harmonics or from some other cause, or whether a machine in a production line is producing scrap because variations in the power supply are causing variations in machine performance.

To get the correct answers, organisations need to do two things:

1. Troubleshoot to the root cause.
2. Determine the actual costs.

Here’s an example: A factory is making plastic webbing that must be of uniform thickness. Operators consistently report high scrap rates in the late afternoon. The machine speed variances can be directly traced to low voltage caused by heavy HVAC loads. The operations manager calculates the net scrap costs are $3000 per day. That’s the revenue cost of the low voltage. But, don’t forget other costs, such as those already identified for downtime.

Energy costs

To reduce an organisation’s power bill, consumption patterns need to be recorded and the system and load timing adjusted to reduce one or more of the following:

• Actual power (kWh) usage
• Power factor penalties
• A peak demand charge structure

Until now, capturing the cost of energy waste caused by power quality issues was a task for the most expert engineers. The cost of waste could only be calculated by serious number crunching, a direct measurement of the waste and monetisation was not possible. With the patented algorithms used by some power quality analysers, waste caused by common power quality issues such as harmonics and unbalance can be measured directly.

By inputting the cost of energy in to the instrument, the cost is directly calculated.

Organisations can reduce power usage by eliminating inefficiencies in their distribution systems. Inefficiency sources include:

• High neutral currents due to unbalanced loads and triplen harmonics.
• Heavily loaded transformers, especially those serving non-linear loads. Old motors, old drives and other motor-related issues.
• Highly distorted power, which may cause excessive heating in the power system.

Organisations can avoid power factor penalties by correcting for power factor. Generally this involves installing correction capacitors. But, first correct for distortion on the system - capacitors can present low impedance to harmonics and installing inappropriate PF correction can result in resonance or burned out capacitors. Consult a power quality engineer before correcting PF if harmonics are present.

Organisations can reduce peak demand charges by managing peak loading. Unfortunately, many organisations overlook a major component of this cost, which is the effect of poor power quality on peak power usage, and underestimate overpayments.

To determine the real costs of peak loading, organisations need to know three things:

• ‘Normal’ power usage
• ‘Clean power’ power usage
• Peak-loading charge structure

By eliminating power quality problems, organisations reduce the size of the peak demands and the base from which they start. By using load management, organisations can control when specific equipment operates and thus how the loads ‘stack on top of each other’.

For example, a building averages 515 kWh and the peak load is 650 kWh. Add load management to move some loads around so that fewer loads stack on top of each other at once and the new peak load will rarely go beyond 595 kWh.

Let’s walk through an example: Your factory/office complex averages 570 kWh of consumption during the workday, but hits peaks of 710 kWh most days. Your utility charges you for each 10 kWh over 600 kWh for the whole month, any time you exceed 600 kWh during a 15-minute peak measurement window. If you were to correct for power factor, mitigate harmonics, correct for sags and install a load management system, you would see a different power usage picture - one you can calculate.

Saving money with PQ

Now that the costs of poor power quality have been tallied, ways to eliminate these costs need to be considered.

These steps will assist organisations in eliminating the costs of poor power quality.

• Examine design. Determine how the system can best support processes and what infrastructure the organisation needs to prevent failure. Verify circuit capacity before installing new equipment. Re-check critical equipment after configuration changes.
• Comply with standards. For example, examine the grounding system for compliance with IEEE-142. Examine the power distribution system for compliance with IEEE-141.
• Examine power protection. This includes lightning protection, transient voltage surge suppressor (TVSS) and surge suppression. Are these properly specified and installed?
• Get baseline test data on all loads. This is the key to predictive maintenance and it lets organisations spot emerging problems.
• Question mitigation. Mitigating power quality problems includes correction - for example, grounding repair and coping; for example, K-rated transformers. Consider power conditioning and backup power.
• Review maintenance practices. Is testing followed up with corrective actions? Conduct periodic surveys at critical points - for example, check neutral to ground voltage and ground current on feeders and critical branch circuits. Conduct infrared surveys of distribution equipment. Determine root causes of failures to prevent recurrences.
• Use monitoring. Can voltage distortions be seen before they overheat motors? Can transients be tracked? If power monitoring is not installed it will be difficult to see a problem coming but the downtime it causes can’t be missed.

At this point, an organisation will need to determine the costs of prevention and remediation and then compare those to the costs of poor power quality. This comparison will let organisations justify the investment needed to fix the power quality problems. Because this should be an ongoing effort, organisations should consider investing in the right tools to undertake power quality testing and monitoring in-house rather than outsourcing it. Today, this approach is surprisingly affordable and it will always cost less than downtime.