Cost of Shop Power

Understanding (and minimizing) your shop's utility bill. July 5, 2006

I know this figure will vary a lot, because of the machinery or lighting, and maybe because energy costs vary, but what are you guys spending for power in 3ph shops ranging from 4000 sq ft to 30,000 sq ft, adequately machined for a millwork or cabinet shop? This would be a shop that does not use electric for their primary source of heat. Iím referring to seasonal rates, to allow for office HVAC. Iím asking because I am just opening and what I budgeted from my business plan is about half of the actual bill. Actually my power bill is more than my mortgage, and we are not even close to being fully running. Iím afraid to see the bill when we are fully running, which will be soon.

Forum Responses
(Cabinetmaking Forum)
From contributor A:
Here's how you can figure out how much your gas fired appliances cost per hour to run. Look on your gas bill to see what you are paying either per Mcf or Ccf of gas. A Ccf is know as a "therm" and is the equilavent of 100,000 BTU. A Mcf is the equivalent of 10 therms or 1,000,000 btu's. My gas rate is $14.62 per Mcf.

Now you have to look at your modines or furnace to see what the rated input is. For instance, my rooftop unit has an input of 375,000 BTU/hr. That means if I run the heat and it burns fuel continuously for 1 hr, it will use 3.75 Ccf of gas at a cost of $5.51 per hour. If you wanted a worst case scenarios multiply that by 160 hours per month and you get $882.00. That is a worst case scenario, as my unit doesn't run a full 8 hours per day, and I have programmable thermostats that take it down to 50 after 5:30pm.

For electric heat you follow the same principle. Look at your electric bill and find the total KWH used that you were billed for. Take your monthly bill and divide that by KWH's used for the month to determine your total cost per KWH. Don't just use the base rate. My base rate is =.04872 per KWH, however when you factor in the customer charge, distribution charge, transition charges, and the real killer demand charges, my electric cost just a little under .20 per KWH. For electric heat you need to know the wattage of the heat. For example, a 5000 watt heater uses 5KW of power per hour, and 5x.20/KWH= $1.00 per hour.

I hope this helps you. When I had my first shop 10 years ago, I was totally ignorant about how to calculate the cost of power. I had 3 big gas heaters and just figured I would leave them set at 70 like I do at home. The next month my first gas bill was $2200 for a 5000sf shop. I didn't realize that the heaters cost about $10.00/hr to run. It was an expensive lesson.

From contributor B:
I would like to add another point. What you pay for utilities is going to vary depending on what part of the country you live in. For instance, it is my understanding that we in the Northeast have higher natural gas prices than the rest of the country. But there are many other factors to consider. Is the building a modern and fairly well insulated one, or a barn with plenty of drafts? Do you have programmable thermostats to keep the heat low overnight? How tall are your ceilings? What type of lighting and how much of it? I can't help with figures as my shop is only 2k sq. ft. but I think if you use the previous advice it will help you focus on what you are using and possibly wasting for energy.

From contributor C:
Here's something my electrician did that seems to help: I'm going to make up some of my own words, but I hope you will get the drift. I've been in my building for 20 years and it was a cabinet shop 12 years before I showed up. Wiring to the panel was developed on kind of an ad hoc basis over all those years, without any overall planning. When we brought in a 2 head widebelt it was discovered that the load coming off the 3 phase panel was not balanced. As the breakers were arrayed onto the busbars, more of my heavy use machines were on one side of the panel than the other. This caused a disproportionate amount of amps coming through that side of the panel than the other side.

The electrical meter rotates according to the highest used phase. Rather than have one pole taking 50% of the hits and the other two each taking 25%, the wires were re-arranged such that all three poles took 33%. The net impact of this scenario was a 17% reduction in how many times the meter turned. (These percentages are just for illustration. I can't remember what they really were) Like I said, I am not an electrician, so I am making up my own words for these concepts. The net impact of all this was that I was actually using less watts of electricity after the 120 amp sander than before it.
This is not entirely objective. At about the same time we converted all of our conventional florescent lights to T-8 electronic ballasts.

Those two moves cut my electricity consumption considerably. The electrical bill hasn't necessarily come down because the rates are increasing, but the savings over three years probably paid for the installation of my widebelt sander.

From the original questioner:
I left out the heat part because we heat with a 800,000 BTU wood furnace (shop floor) and a 500,000 BTU boiler (in our finishing booths). We are in 30,000 sq ft and occupy 20,000. Our moulders and dust systems and CNC with vacuum pump are not running much yet, so that leaves the typical shop tools and shapers, wide belt sander, lights etc. Our lights are 480 v 3ph sodium, supposedly efficient. Our bill at just start up with four men on the floor and two in office is $1400-1800 monthly.

Iíll look into the balancing the breaker box. It sounds like there could be something to it. If that is going rate then Iíll live, but I thought was high and scared of the near future of half production. Our building is well insulated.

From contributor A:
Is the 800k BTU furnace wood fired? If so, 1 lb of wood gives off 8000 BTU/hr when burned, so you would need about 100 lbs of waste an hour. Balancing your load is only for single phase applications, primarily if you have a large 120 volt load. In a 3 phase breaker panel, it doesn't matter if your breaker is on the left or right side. The buss is in the middle of the panel (usually) and your using A, B, and C phases.

Another misnomer is that it's cheaper to run a motor on 480 volts rather than on 240 or 208. That simply isn't so. Your bill is based on Kilowatt hours, not amperage. A 10 HP motor uses 7460 watts/hr at either 240 volts or 480. The amperage for 480 will be half, but again youíre not paying for amperage. If youíre new to commercial electric services, unlike your home bill, commercial 3 phase services also have a demand charge. So not only do you pay for the quantity of electric that you consume in Kilowatt hours, you also pay a hefty fee for the size of your load. It varies across the country, but generally you pay for your heaviest load in any giving 15minutes per billing cycle.

My demand charge is $9.18 per KW. For example, if I turned on a 130HP motor for 1 hour, my demand for that hour would be 100KW. If that was my largest load during the month, my demand charge on my bill would be $918.00. The utility companies claim that they are justified for this charge because they have to have enough generators running to supply everyone if they all demanded their full load at any one time.

There is a good chance that your demand portion of the bill is larger than the consumption. Mine usually is.

1 HP = 746 watts or .746 KW
1 KW = 1.34 HP
To determine cost per hour for a 50 HP motor:
50 HP x 746 watts = 37300watts or 37.3 KW.
37.3 KW x .10/KWH= $3.73/hr

From contributor D:
Thank you for the clear explanation of demand meters. Iíve called the power company on this several times and could never get a grasp of how demand works. To the original questioner - for your comparison, our shop is 4000 sq ft, 400amp 3 phase service with wild leg, Machines - 3 head wide belt, S4S molder and 15 Hp dust collector are the heavy hitters. Shaper, planer, jointer, resaw, ripsaw, slider, briquetter, spray booth and compressor in the 7.5 to 12 HP range, and 5hp and less typical smaller tools. Everything but the dust collector has soft start. There are two employees and myself part time in the shop. Heat is gas. Standard fluorescent lights. Our power bill with demand runs 500 to 650 dollars per month. It was the same when I had five employees. Last November the shop was closed for 2 Ĺ weeks. No change in the bill. Itís all in the demand. We had no demand the first 10 years of our 3 phase service and the bill was always under 100 dollars.

Iíve always heard demand is billed on start up amps and we are careful never to start the bigger motors at the same time or run the molder and wide belt at the same time. It seems like our biggest jumps on the bill come with heavy molder or sander running times. I think it could cost more in lost labor trying to be too careful about what gets turned on and when. Our dust collector runs a lot and sometimes for only a small drill or saw. Iím thinking about hooking up Festool vacuums or a small collector on these machines to cut the running time of the big collector. A Dantherm tech told me auto blast gates and a variable speed dust collector networked to only supply needed CFM could be another answer.

From contributor E:
Your bill probably won't say "demand" charge. At the bottom of my bill it says "Billed Load in KW/KVA". In the itemized section of the bill is where they hit me with the charges - $4.67 per KW for distribution, and $4.51 for transition charges.

From the original questioner:
Is there anything I can do to reduce it? Does the soft start help? Would I be better off changing over to florescent lights just over the working areas? We have a 30hp and 90 hp compressor which for right now is more than we need, but it ties into our dryer. I was told we were on actual use by the power company. The 800 BTU is wood fired, with no electric except the blower for the duct inside the shop.

From contributor D:
My bill for January (light one for a change) goes like this:

2480 KWH@ .052396 $129.90

31.28 Units of Demand @13.1 $409.77
Access Charge $28.91
State and county taxes are added to this

I assume the access charge is like a service charge. I looked back through the year and the demand rate varies by a few cents. Like I said heavy molder and sander months seem to jump the bill by $100 to $200. So I am not sure if start up has anything to do with it. I could not tell about the soft start because about the time we added all that was when the demand went on.