A Proven Strategy to Control Rising Energy Costs
Energy is on the minds of people all across the nation. The growing demand for energy and the blow from recent hurricanes to domestic oil and gas supplies have spurred escalating costs, and impacts are being felt throughout all sectors of the economy. To keep higher energy costs from dampening profitability, now more than ever is the time for industry’s key-decision makers and facility managers to execute energy-saving strategies in their plant facilities.
As companies are exploring ways to cut electricity bills and increase profits, many are discovering that improving motor system efficiency can have a dramatic and lasting impact on the bottom-line. According to the U.S. Department of Energy (DOE), greater attention to motor system optimization can reduce motor energy costs by up to 18 percent [i] .A proactive motor management plan can be considered as one component of an overall optimization strategy. Motor management is a set of strategies designed to help companies manage their motor populations more effectively by planning ahead for motor failure and incorporating life cycle costs in their decision-making process.
Energy and the Bottom-Line
Motor efficiency is even more important today because of the rising cost of electricity. The Energy Information Administration (EIA) website provides average annual energy costs by state across the U.S. [ii] According to those figures, state average costs have increased by 10 to 30 percent over the last five years. Figure 1 represents data from a cross-section of states in the Continental U.S., and illustrates this steady increase in electricity costs.
Although electricity costs have not spiked as dramatically as oil and natural gas costs, the volatility in the energy market and uncertainty of energy supplies overall is driving the need for greater energy-efficient changes in plant operations. Even small percentage increases in electricity prices equate to a significant jump in costs for plant facilities running motors and other equipment almost continually.
“Faced with competing priorities, plant managers often overlook the opportunity to reduce overall operating costs by better managing their selection, application and repair of electric motors,” said Rob Boteler of Emerson Motor Company, a sponsor of the Motor Decisions Matter (MDM) campaign which supports motor management principles. Often new motor purchases are driven by price and by the urgency to get failed motors repaired and back into service as quickly as possible. For this reason motor selection becomes reactionary and unplanned leaving motor-related energy costs with little to no attention.
Motor Efficiency Garners Significant Cost Savings
That mindset may be starting to change. President Bush is calling for consumers and businesses to increase conservation efforts in an attempt to curtail an energy crisis. Out of necessity, more industrial facility managers will need to reassess their plant’s energy usage just to stay competitive and out of the red. As reported on its corporate news home page, early last month Dow Chemical announced aggressive cost-cutting measures. The company is focusing more on energy efficiency and conservation and even shutting down some inefficient plants in North America.
According to DOE, process motor system energy accounts for almost 63% of the electricity consumed by the manufacturing sector  . The cost of electricity for these motor systems can exceed $1 million annually in large industrial plants, and can exceed $6 million annually in steel plants  . Some manufacturers are discovering that replacing inefficient motors with premium efficient motors can help reduce these costs.Eastman Kodak is one example.
With between 70,000 and 90,000 motors at one campus alone, it was critical that Eastman Kodak move toward improved energy efficiency  . In one area, they replaced inefficient motors with more efficient models, which resulted in a savings of $200,000. Based on a predetermined motor plan, other unique motors were repaired under best practice guidelines as defined by the Electrical Apparatus Service Association (EASA).
Small to medium sized plants may also benefit from upgrading to more efficient motors in its plant facilities. Woodgrain Millwork in Fruitland, Idaho is one such example  . So far, the company is saving $8,250 annually and has reduced downtime costs following the replacement of seven motors with premium-efficiency models. Their goal is to include NEMA Premium motors as part of their motor management plan.
Proven Successes of Motor Management
Not having a motor management plan in place can lead to hasty decision-making when motor failure occurs, resulting in higher operational costs. In contrast, a sound motor management plan helps ensure that decisions will be both quick and cost-effective. Corning has also recognized the benefits of implementing a motor-management plan  . It was estimated that at three of its plant facilities, energy savings of about $48,212 a year would be realized by implementing a motor-management plan. These annual savings will continue for years to come.
Successful motor management programs are based on some fundamental principles.The building blocks of effective motor management include:
%%POINT%%A motor survey and tracking program
%%POINT%%Guidelines for proactive repair/replace decisions
%%POINT%%A strategic spare-motor inventory for critical applications
%%POINT%%Purchasing and repair specifications
%%POINT%%Predictive and preventative maintenance programs
These principles, along with clear steps for implementation, are laid out in the Motor Planning Kit , one of the many resources developed by the Motor Decisions Matter campaign. Many organizations have chosen to phase in selected parts of a plan over time while others implement a more wide-ranging plan all at once. By developing and implementing a plan suited to their individual organizational needs, companies can improve the energy-efficiency of their facilities and decrease their energy costs.
Industrial facility managers are usually astounded to learn that only about 5 percent of the lifetime cost of the motor represents the purchase price, installation and repair costs. Shockingly, electricity accounts for the remaining 95 percent, as illustrated in Figure 2 below  .
Consider an EPAct motor, 100 horsepower, 94.5% efficient with a list price of $8000  . Now assume the motor runs at full load for 6300 hours per year and that electricity costs are 7.5ater savings may be possible for larger increases in efficiency, as well as for longer run hours, higher electricity costs or larger motor populations.
Get Started to Start Saving
Although rising energy costs show no signs of slowing down, it’s not too late to reign in those accelerating electricity bills. Here are a few suggested steps to get you started:
%%POINT%%Call your local motor service representative to discuss NEMA Premium motors, repair/replace strategies and other aspects of a motor management plan.
%%POINT%%Contact your local utility service provider to inquire about motor related programs in your area.
Companies that embrace the long-term vision of energy-efficient business practices by making sustainable and permanent changes are the same companies that will recognize the impact of improved energy performance on share holder value and corporate profits. Implementation of a motor management plan is a means to that end.
Motor Management Resources
Motor Decisions Matter (MDM) is a national public-awareness campaign sponsored by motor manufacturers, NEMA, EASA and other trade associations, electric utilities, the U.S. Environmental Protection Agency and the Department of Energy. Managed by the Consortium for Energy Efficiency (CEE), MDM promotes energy-efficiency by encouraging commercial and industrial facility managers to use sound motor management as a tool to cut energy costs and increase productivity.It seeks to inform executives and other top-level decision makers about the potential bottom-line savings associated with sound motor planning and the purchase of NEMA Premium motors.
Motor Planning Kits, case studies, the current list of MDM Sponsors, additional tools and resources are available at www.motorsmatter.org .
U.S. Department of Energy, Final Report of the United States Industrial Motor System Market Opportunities Assessment (Burlington, Massachusetts: Xnergy, Inc., 1998), 7
 Data from EIA, the official energy statistics from the US Government: 2000 data from http://www.eia.doe.gov/cneaf/electricity/epa/epa_sprdshts.html and 2005 data obtained from http://www.eia.doe.gov/cneaf/electricity/epm/table5_6_b.html.
 U.S. Department of Energy, Final Report of the United States Industrial Motor System Market Opportunities Assessment (Burlington, Massachusetts: Xnergy, Inc., 1998), 9
4U.S. Department of Energy, Final Report of the United States Industrial Motor System Market Opportunities Assessment (Burlington, Massachusetts: Xnergy, Inc., 1998), 13
 Case study done by the New York State Energy Research and Development Authority (NYSERDA)
 Case study done by the Northwest Energy Efficiency Alliance http://www.motorsmatter.org/kit/SS_Woodgrain.pdf
 Case study done by the New York State Energy Research and Development Authority (NYSERDA)
 The pie chart is based on a hypothetical 100 hp motor that is 94.5% efficient (EPAct minimum for 1800 rpm, TEFC). It assumes that the motor runs 6,300 hours per year with a $0.075 per kWh electricity rate. Yearly maintenance costs are estimated at $1,000; estimated purchase price is $5,500; estimated installation cost is $1,000, and other costs are estimated at $500 per year. Your actual cost percentages will vary with factors such as motor size, efficiency, cost of electricity, and run time.
 Mean list price of 100 hp, TEFC, 1800 RPM motors based on information from the MotorMaster+ database as calculated by WashingtonStateUniversity, December 2005.