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Commercial, industrial, and institutional establishments that pay high demand charges can potentially reduce these costs by improving their load factor and power factor. Load factor is a measure of how evenly electricity is used throughout a billing period - a higher and more consistent load factor results in lower average costs. Power factor is a measure of how efficiently electricity is being used - a power factor close to 1 is most efficient. Methods for improving load factor include shifting usage to off-peak times and using storage systems, while power factor can be improved by adding capacitors to offset inductive loads from motors and other equipment. Making these improvements can help reduce demand charges and overall electricity costs.

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Commercial, industrial, and institutional establishments that pay high demand charges can potentially reduce these costs by improving their load factor and power factor. Load factor is a measure of how evenly electricity is used throughout a billing period - a higher and more consistent load factor results in lower average costs. Power factor is a measure of how efficiently electricity is being used - a power factor close to 1 is most efficient. Methods for improving load factor include shifting usage to off-peak times and using storage systems, while power factor can be improved by adding capacitors to offset inductive loads from motors and other equipment. Making these improvements can help reduce demand charges and overall electricity costs.

Uploaded by

alekya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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E L E C T R I C A L E N E R G Y M A N A G E M E N T G U I D E L I N E S S E R I E S NO.

1 0 2

Improving Load Factor and


Power Factor to Reduce Demand
EmgyS e m
for Business and Industry

Potential Savings for Heavy Users of Electricity


Commercial, industrial, and
- I
institutional establishments
15

that pay demand charges,


that use relatively large
amounts of electricity, or
that have electricallypowered systems with
potential for power factor
problems may be able to
reduce demand charges by
improving load factor and
power factor.

14

1312.

AVERAGE COST
PER KWH AT
VARIOUS LOAD FACTORS

I
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I
I

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1

11.

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The amount of power


required to operate energyusing fixtures and equipment
is measured in terms of
kilowatt (kW) demand. The
kW demand charge is the
charge for the highest power
demand recorded for any 30minute interval during the
monthly billing period.

Improving
Load Factors
Load factor (expressed in
terms of percentage) is a
measure of the uniformity
and efficiency with which
electrical energy is being
used. A good load factor
implies a more constant rate
of electrical use, because kW
demand is held to a minimum relative to total overall
use. In essence, the lower
the established demand in
relation to kilowatthour
(kWh) use, the better the
load factor, the lower the
relative cost for electric
service.

ENERGY
COST
KWH

(#I

10

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9
8

1.58g

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SAVINGSIKW H
OR
e----..
I
24.45 %
I
I
REDUCTION
II
IN COST

LOAD F

While load factor is one element in calculating the efficiency with which electricity is used, load
factor ratios are not normally stated in billing information. Most billing information, however,
provides sufficient information to determine load factor ratios using the following formula:
Load Factor (%) =

Energy Used (in kWh)


Maximum Demand (in kW)

1
Time
(hours in billing
period)

ELECTRICAL

ENERGY MANAGEMENT

For example, if 100,000kWh


are consumed over a monthly
billing period (730 hours) and
during that time a peak
demand of 2 14 kW is
established, the load factor
would be 64 percent. Representative ranges for load
factor in facilities without
specific load factor improvements could be:

~~

GUIDELINES

SERIES

TIME OF DAY
I

Facilities with a I-shift


operation - 35 percent

Conventional System

Facilities with a 2-shift


operation - 60 percent

TIME OF DAY

Facilities with a 3-shift


operation - 80 percent.
The load factor curve shown
in Figure 1 shows how load
factor improvement can lower
your average energy cost.
The consumer may improve
his load factor in several
ways. Among these are:
Arranging work schedules to reduce peak load
by shifting some electrical use to other time
periods.
Using interlocks to
prevent simultaneous
operation of selected
equipment.
Using heat and cool
storage equipment to
reduce peak load (see
Figure 2).
Staggering preheating
times on process or
space heating applications.
Using demand controlIers to limit kW demand
in facilities where some
power loads can be deferred.
Adding off-peak energy
usage.

Off-peak Cooling System


Figure 2
Although cool storage may
not necessarily reduce your
building's overall energy
consumption, it can significantly reduce your building's
on-peak demand and lower
your overall energy expenses
as these charts illustrate.

Improving
Power Factors

motors, generators, transformers, and other inductive


equipment. The power
being supplied is called the
apparent power and is
usually expressed in kilovolt
amperes (kVA). The
apparent power must be
sufficient to supply both the
total real and reactive power
components of the
consumer's electrical load.

Most electrically-powered
machinery and equipment
requires two kinds of power
-- real, usually expressed in
kilowatts (kW) and reactive,
usually expressed in kilovolt
amperes reactive (kVAR).
The real power is the workproducing power. Reactive
power supplies the magnetizing field required by

Power factor (PF) is the ratio


of actual power converted to
work in a circuit to the
apparent power being drawn
from the line. It is an
important measurement to
utilities, because it affects
the amount of utility
generating capacity required
to provide service to a given

load. Power factor is also


important to consumers,
because it can restrict
capacity and affect voltage
regulation and service cost.
The relationships between
kVA. kW, kVAR, and PF
are illustrated in Figure 3.

ELECTRICAL

ENERGY MANAGEMENT

GUIDELINES

SERIES

Low Power Factor


Adjustments
Low power factor indicates
that electricity is being used
inefficiently, and low power
factor adjustments are
charges for the inefficiency
and resulting generating
capacity loss for TVA.
A facility can have a low
power factor for both
lagging and leading load
conditions. If the net
reactive power requirement
(LVAR) is inductive, a
lagging power factor
condition will exist. If the
net reactive power requirement is capacitive, a leading
power factor condition will
exist. The ideal condition
occurs when the inductive
and capacitive load components are equal, in which
case the effects cancel, and
the apparent power supplying the load will be equal to
the real power component of
the load. The power factor
in this case is 100 percent
(neither leading or lagging)
resulting in the most
efficient use of the power
supplied. Since this condition is difficult to achieve in
practice, TVA and distributors of TVA electric power
allow certain leading and
lagging power factor variations before adjustments are
applied to the customer's
electric bill.

ACTIVE POWER (KW)


Figure 3
Low lagging power factor
conditions can result by the
use of various combinations
of the following common
inductive devices.
Induction motors, including motors that are
parts of compressors on
air conditioners, refrigeration systems, pumps,
etc. (These are the most
common causes of low
lagging power factor
conditions because so
many are in use and
often run at less than
full load.)
Inductive loads of fluorescent ballasts
Rectifiers providing a
DC power supply
Arc welders

Solenoids

Power
Measurements

Induction heaters

Real power (kW) typically is


measured through demand
metering. Apparent power
(kVA) may also be measured. Reactive power
(kVR). not necessarily
measured on demand meter\.
can be determined from:

Lifting magnets
Small "dry-pack'' transformers.

In most cases, the addition


of properly sized and applied
capacitors can compensate
for low lagging power factor
conditions.
Low leading power factor
conditions usually occur as a
result of too many fixed
capacitors connected to the
electric system during louer
load (off-peak load) conditions. This condition can bc.
corrected by installing
automatic load scming
capacitors or by implrmcnling manual proccdurc\ for
disconnecting thc cJp.uitorr
\vhcn n o t nccdcd.

1 .) the mcawrcd k W and


k V A u\ing the fomiula

in Figurc 3. or

-1
ELECTRICAL

ENERGY MANAGEMENT

GUIDELINES

Adjustments Included in Demand Charge


For consumers on General Power rate schedules, TVA accounts
for the expense of producing reactive power by including in its
rates:
Power factor provisions for customers with no
contract demand or with a contract demand of
5,000 kW or less.
Reactive demand charge provisions for customers
with contract demands above 5,000 kW.
Power factor improvement can be beneficial in lowering or
even eliminating cost adjustment increases on a power bill if a
facility's electric use meets one or more of the following
conditions:
The electric rate has a reactive or power factor
adjustment clause, and the facility's power factor is
less than the specified minimum.
There are problems with voltage regulation or
chronic low voltage.
Power factor is low and load growth is limited by
capacity.
The facility at certain load periods experiences
excessive leading power factor conditions. (Applies
only to customers with reactive demand charge
provisions.)

For More Information


It is advisable to review the need for power factor correction
with either your power distributor, equipment manufacturer,
consulting engineer, or TVA.

For more information on load factor and power factor improvements, call or write your power distributor or the TVA office
nearest you.

SERIES

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