Your total compressor cost may be too high

When users talk about updating their compressed air systems, they often say: "The price is too high!" Why is that? And why is the price always questioned? Maybe cost is not explained well enough.
By Harold H Wagner May 1, 1999

When users talk about updating their compressed air systems, they often say: “The price is too high!” Why is that? And why is the price always questioned? Maybe cost is not explained well enough.

It is the real cost of a new compressor that counts, not just the initial price tag. To better visualize cost, use this formula to relate price and value:

Cost = Price / Value

The formula shows that the value of a product — not only the initial price — determines real cost. The higher the true value, the lower the cost.

Value has to be defined before looking at the impact it has on compressed air cost. Overall compressed air cost depends on electrical efficiency and maintenance plus equipment price (Fig. 1). A quality piece of equipment has high efficiency and low maintenance.

Basic cost structure

All costs associated with generating, storing, and distributing compressed air determine the total cost. This cost ranges between $0.30- $0.40/1000 cu ft. It is easy to see that compared to water, gas, and electricity, compressed air is by far the most expensive utility.

Energy cost

As the pie chart shows, the major cost portion of compressed air is electricity. At $0.08/kWh, it represents more than 70% of compressed air cost. It is crucial to evaluate how value-added features impact energy consumption.

Maintenance cost

Maintenance costs vary from 10%-20% depending on the type of compressor, operating conditions, and elapsed service life.

Initial purchase cost

While the initial purchase price is often the most discussed, it only accounts for 10%-20% of compressed air cost. It is important to determine how each compressor feature affects this compressed air cost.

It is a mistake to purchase a compressor, which is 20% less expensive, accounting for only 4% (0.20 x 0.20) of total compressed air cost, but requires 20% more energy, or 14% (0.20 x 0.70) of total compressed air cost.

Value and how it is measured

Value is the customer’s total benefit. While the value of some features is influenced by an individual’s perception, most features result in accountable benefits, such as reduced energy bills. Service and support before and after the equipment purchase often generate value. A properly sized and installed compressed air system definitely offers value to the customer (Fig. 2).

Anything above industry-accepted standards (motor efficiency, specific compressor performance, noise levels, etc.) also adds accountable value. For comparison, standard features can be scaled at 100, below average features can be scaled below 100, and above average features can be scaled above 100.

For example, if the industry uses open drip-proof (ODP) motors with standard efficiency, then a compressor equipped with a high-efficiency, totally enclosed, fan-cooled (TEFC) motor should receive a 110 rating. An ODP motor operating at the high end of its service factor should only get a 95 rating.

Drive motors

TEFC motors are better protected against dust and contaminants and earn a higher rating than ODP motors. Operating a motor at a service factor higher than 1.00 (overloading the motor) increases the motor winding temperature, resulting in reduced service life. The motor also operates less efficiently, which lowers its rating below 100.


Airend efficiency is one of the most important features on a rotary screw compressor. Since energy accounts for over 70% of total cost, any reduction in specific power consumption (cfm/bhp) greatly affects total cost. The rotor profile should not depend on sealing strips or employ an asymmetrical design.

A reliable way to judge compressor package performance is to compare the compressed air delivered from the aftercooler discharge at a specific pressure/bhp used (cfm/bhp @ rated psig). The assigned value rating should reflect the importance of airend-compressor package efficiency on total cost.

Compressor controls

The basic function of a compressor control is to match the compressed air demand of the system to the compressor output. Dual-control or start-idle-stop control is overall the most efficient system (Fig. 3).

Comparing the power consumption at reduced loads reveals a maximum savings potential of up to 70%, compared to straight modulation control. The right compressor control is one of the most important efficiency features. The assigned value rating reflects this influence on compressed air cost.

Noise levels

EPA has established regulations to protect the environment and plant personnel from exposure to excessive noise. In general, equipment generating noise above 85 dbA must be installed in a separate building or room or ear protection must be worn at all times.

While individual company and insurance guidelines vary, it is desirable to install equipment with the lowest noise level possible.


Many factors determine compressor maintenance requirements, including type, size, application, and age. A major consideration is whether the compressor is a lubricated or oil-free design. Since compressed air needs to be dried and filtered with either design, the need for an oil-free compressor and its increased maintenance requirement should be carefully evaluated.– Edited by Joseph L. Foszcz, Senior Editor, 630-320-7135,

Key concepts

Real compressor cost includes energy consumption, maintenance, and initial price.

Over a compressor’s life, electricity is about 70% of its total cost.

The value of compressor features influences its real cost.

Noise level ratings

A rating of 100 is assigned to the following horsepower ranges and noise limits.

Motor, hp Sound level, dbA

5-20 Less than 70

25-50 Less than 76

60-150 Less than 82

200 and larger Less than 85

Features providingmaintenance value

– Easy access to all maintenance points.

– Maintenance indicators for all filters (oil, air, and separator).

– Convenient and reliable communication about service requirements and event history (motor starts, operating temperatures/trends, load vs idle hours, etc.).

– Long maintenance intervals.

– Fast and convenient cleaning of coolers in extreme environments.

Comparing compressor cost and value

A potential customer received two bids for a 50-hp rotary screw compressor and wants to make an educated buying decision. The specifications for the units are:

Unit A Industry

55 bhp standard Value, %

230 cfm at 110 psig (4.2 cfm/bhp) 4.5 90

ODP motor with 89% efficiency 92% 96

87 dbA (no enclosure) 76 dbA 96

Modulation control Dual 85

$11,500 purchase price $14,500 106

Total value factor, Unit A

0.90 x 0.96 x 0.96 x 0.85 x 1.06 = 0.75

Unit B Industry

50 bhp standard Value, %

240 cfm at 110 psig (4.8 cfm/bhp) 4.5 110

TEFC Epact motor with 93.5% efficiency 92% 104

74 dbA (with enclosure) 76 101

Dual control Dual 100

$16,000 purchase price $14,500 96

Total value factor, Unit B

1.10 x 1.04 x 1.01 x 1.00 x 0.96 = 1.11

Use the Cost = Price / Value formula to determine which unit costs less.

Cost of Unit A = $11,500 / 0.75 = $15,333

Cost of Unit B = $16,000 / 1.11 = $14,414

More info

The author is available to answer questions about evaluating true compressor costs. He may be reached at 540-898-5500.

See the Compressors channel on PE Online ( for more articles related to this topic.