Amendment to Common Sense Management of EISA Motor Changes

The web version of Plant Services contains an update of the November issue's Strategic Maintenance column, "Consider the Motor's Life." The correction comes thanks to Rich Gushman, a loyal reader from Longview, Washington. Rich pointed out a payback error in the original version of the chart below.  Here is the updated chart, along with a couple of additional points about taking advantage of the Energy Independence Security Act (EISA) motor opportunity.

EISA, a law that took effect about a year ago, requires electric motor producers to meet increased efficiency standards for three-phase AC induction motors from 1 to 200 hp. Motors manufactured after Dec. 19, 2010, must conform to the NEMA Premium efficiency standards. Old standard motors can still be rebuilt and sold, as can new old stock of pre-EISA motors.

NEMA Premium motors carry about a 15% price premium over old style motors, but they deliver 1.5 to 2.5% better power efficiency. This doesn’t sound like much of a deal until you realize that the lifecycle cost of an electric motor runs something like 2% purchase price, 2% lifetime maintenance and 96% energy cost. At that rate the payback period for the extra cost of a premium motor is a little over 2 years. After that the energy saving is gravy.

To figure out the actual savings for your factory, you will want to team up with the controller. There are several areas of savings that can be tapped when the plant changes over to NEMA Premium motors. Only one of these areas has been identified in the chart below, since the winds of change in Washington, D.C., or your state may affect the availability of the others. Your controller's office will be able to build actual figures into your business case. The available savings are improved electrical efficiency (see the chart below), tax incentives for improved electrical efficiency (check current federal tax code), and other investment incentives for job creation and business investment (check tax code and state incentives). The new green motors might be viewed as capital investments, rather than maintenance expenses.

EISA provides an opportunity for some plants to improve electrical efficiency, take advantage of investment tax reductions or credits, and reorganize electric motor inventory to deliver some exciting financial results.

Cost Standard EISA
Purchase Price       $2,000 $2,000
Maintenance Cost 2,000 2,000
EISA Upgrade = 15%   300
Annual Energy Cost (Standard)    6400  
Annual Energy Cost (EISA/Premium)   6272
Lifetime Energy Cost 96,000 94,080
Lifetime Cost $100,000 $98,380
Payback for Upgrade (Months)        28

As always, you will want to obtain actual cost and energy consumption numbers from your electric motor provider. You will also need the latest tax, investment credit, and motor inventory information from your own accounting department. For more information, read the full updated Strategic Maintenance column online at http://www.plantservices.com/articles/2012/11-Strategic-Maintenance-EISA-motor-changes.html.