Lower Your Electric Bill

By Sam Watts | Oct 09, 2009

While operating several coin laundries over the last 28 years, I have just blindly paid my electric bill without giving it much thought. The only thing I knew about it for sure was that it came in the mail every month. Almost all of the information on energy savings in the coin laundry industry has been focused on natural gas and water. And, therefore, I have paid a little more attention to these.

However, a sales representative recently came to my office suggesting that he had something that could lower my cost of electric between 10 percent and 20 percent. I decided to try it – and, sure enough, we have carefully measured the use on a per-day basis for a three-month period and usage was consistently down 15 percent.

What we installed was an electric box about 10 inches by 12 inches near the main panel. This box is called a power factor correction device. Items that use electric – such as air conditioners, washers and dryers, or anything else with a motor – use what is called the inductive load. Utility companies measure the efficiency of this and it is usually stated on your bill. This efficiency is called the power factor.

Most of us laundry owners are operating at about an 80 percent power factor, which reflects the number of motors that we run. This power factor correction uses capacitors that act somewhat like a battery reserve to smooth out the power spikes and fluctuations. Such a unit can bring your business up to a power factor of about 95 percent. The process itself is referred to as power factor optimization.

If your power factor falls below 80 percent, most electric providers will add a surcharge to your KWH rate. In fact, on one of my electric bills, it had the following statement at the bottom: “The electric meter at your business provides us details about your energy use each month. Recently, it indicated that your power factor – the measure of energy efficiency – has dropped below 80 percent. When this happens, we are authorized in our tariff to include an additional charge on the bill.”

Sure enough, they have extra charges listed on top of the KWH rate. This is at a big campground that we own, and we are now installing the units on 12 different breaker boxes.

I also found some good information from a couple of the utility companies by searching the Internet. Detroit Edison stated: “What can be done to improve power factor? Although there is no single ‘right’ answer, the installation of low-cost, power factor correction capacitors offers one of the most effective corrective measures.” And an article from the Dakota Electric Association noted: “The simplest way to improve power factor is to add power factor correction capacitors to the electrical system.”

What will a unit do for you and your business? For the self-service laundry operator, the unit can:

• Reduce your electrical consumption.

• Increase the life of the motors.

• Boost the capacity of your present electrical system.

• Reduce the heat on your wires, contactors and motors.

• Add surge protection.

Of course, there are a few things you must consider if you plan to purchase one of these devices. First, you will need a breaker in your main electrical panel. So, check your breaker box to see how much room you have there. If you don’t have the room, you may consider a small sub-panel or fused disconnect. Most of these units also come fused.

Secondly, do you have single-phase or three-phase service?

Thirdly, look at the annual and monthly usage to order the proper size of unit. An electrician can install a unit in about one or two hours.

Lastly, what amp service is coming into your coin laundry?

Depending on the answer to these questions, you should be able to install a correction unit for somewhere between $1,500 and $3,000. A large user of electricity could actually use more than one unit in a bank of capacitors.

In general, if a coin laundry owner saves $150 to $200 a month, the payback period for a unit would be about one year.

I know that it has worked well for my laundry business, and it might just work for yours.