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Business: Industrial


Dry-Type Transformers

How Much Will I Save?

Efficiency is the key to determining your savings. That's because the lifetime operating costs from the core and winding losses in an old standard-efficiency transformer are typically about five times the initial transformer purchase price. Table 2 below illustrates how even a small efficiency improvement of less than 1 percent can provide attractive electricity cost-savings.

For example, the incremental cost of a 75 kVA dry-type transformer today is currently about $1,500 more than that of the typical pre-regulation standard efficiency model. However, the annual energy savings from today's compliant unit could be over $200 per year, which would result in a simple payback period of less than seven years for the investment; those savings would continue every year over the 25–to 30–year life of the transformer.

Table 2
Comparison of Lifetime Costs and Simple Payback Period for “Typical Pre-Regulation” and “Post-Regulation” 75 kVA Three-Phase Dry-Type Transformers

Capital cost $1,500 $3,000 $1,500
Efficiency 97.3 percent 98.0 percent 0.7
Annual cost of losses* $632 $391 $241
Simple payback (years) - 6.2 6.2
Lifetime cost of losses** $5,959 $3,690  
Present value of savings - $769  

*Assuming a 35 percent load, an energy cost of $0.08/kWh, and a demand cost of $7/kW month.
**Present value calculation assumes a useful life of 30 years and a discount rate of 10 percent.

Even greater electricity savings are possible with amorphous core transformers, though they typically cost 25 to 30 percent more than comparable transformers with a silicon steel core.

Next: Purchasing Premium Efficiency Transformers