The operating cost for electricity generally consists of three elements of a tariff or a supply contract with the local utility:
Energy (kWh) price of consumed electricity (taking day/night, seasonal and other tariff
elements into account),
Paid peak load cost (kW) taking recorded 15 minute peaks,
Non-corrected power factor (kVA) cost.
Local variations of the above electricity cost elements and structure have to be taken into account as well as discounts, taxes and future price hikes during the anticipated technical lifecycle (how long the machine can typically operate including repairs) of the motor or the application (whatever is less). Fixed costs elements in tariffs are not taken into account because they are not affected by energy efficiency improvements.
Added to the electricity costs are maintenance and repair costs. Their value has to be estimated based on plant experience of cost per operating hour of motors of different output, speed and annual operation.
For a lifecycle cost analysis also the lifetime of the operating costs have to be evaluated. If no data from plant experience in the motor stock are available the following average technical data for lifetime may be used (see table 4):
Rated motor output (kW)
0,75 - 1.1
1,1 - 11
11 - 110
110 - 370
Average lifecycle (years)
Average lifecycles for electric motors
The actual lifetime depends on annual operating hours, cycles and load factor and motor reliability, maintenance quality and repairs. Because operating cost, especially electricity cost, is by far the dominant element in a cost calculation it should be tested with a sensitivity analysis. One or several elements of the operating costs are varied to check whether the results are robust. Robust results mean that different variants of pay back time or life cycle cost do not change their sequence in the comparison. Often assumptions for annual operating hours are the most critical element and thus should be varied.
The simple pay back method is based on the additional investment for higher efficiency motors (and maybe variable speed drives and other improved equipment) versus lower annual operating cost.
The user has to know the following elements:
Purchase price of project variants for different efficiency class motors and variable
Annual operating time,