Guest Message by Roger Behle, P.E.
The Watt is a measurement of power and energy and was named after James Watt, the individual responsible for the improved steam engine invented by Thomas Savery and Thomas Newcomen.The term horsepower was invented by Mr. Watt in 1782. He lived from 1736 to 1819 and is most famous for his work on improving the performance of the steam engine.
Watt was working with ponies lifting coal at a mine, and he wanted a way to talk about the power available from one of these animals. He found that, on average, a mine pony could do 22,000 foot-pounds (lift a bucket of coal weighing 22,000 lbs a distance of 1 foot) of work in a minute. He then increased that number by fifty percent and fixed the measurement of horsepower at 33,000 foot-pounds of work in one minute. So the electrical quantity of one horsepower is 746 watts (at 100% efficiency). The current means of measuring an amount of electricity used in our homes and business is the Kilowatt-hour (kWh), which is 1,000 watts for one hour of consumption. So if you turned on several appliances in your home that added up to 1,000 watts for an hour you would be charged for that power. Costs for this amount of power is somewhere around 11 cents. Not bad in today’s world, where a gallon of treated water in a bottle costs as much as $2, depending on where you shop. Well then, why is it so expensive to run all of these appliances when it only costs 11 cents for one hour of consuming 1,000 watts? Here is where it gets interesting. The utility companies have to build for the maximum consumption of electricity in the worst case. Say it’s July 4th and the temperature is over 100 degrees and you need an air conditioner the whole day. Or in the industrial market a company has to operate a 2,000 horsepower motor for a period of 3 hours a day, but that could be anytime during the day. The utility company must size their system to meet the combined needs of the domestic, commercial and industrial consumers. Therefore they build electrical facilities to meet that potential peak demand. They then pass the cost on to that individual company by imposing a demand charge, which will pay for the potential use of that heavy demand amount of power for anytime that day.
Electric rates are set by each state’s Public Utility Commission and allow the utilities to recover their ownership and operating costs based upon a one year forecast. These include transmission (225KV & less), distribution (12KV & less), generation facilities, fuel costs (try to predict that one!), research and development, and social program costs (such as low-income discounts).
There are different rate structures for different categories of users-residential, small and medium commercial customers, large commercial and industrial users, agricultural & pumping users, and street and area lighting.
The residential market (most homes and small businesses) uses a rate structure that includes a baseline, or minimum charge, (for basic energy needs at a lower rate) and additional charges (at higher unit rates) for power consumed over the baseline. Based on altitude and temperatures for summer and winter, utility service territories are divided into climate zones that reflect the average energy consumption within each zone. One zone may only pay 9.1 cents /kWh and another as high as 14.2 cents/kWh for the same time period. Let’s take a residential home somewhere in California and calculate a monthly electric bill
This single family dwelling with the normal number of appliances and lighting, used 575 kWh in a month. The residential base rate is somewhere between 11.4 and 17.1 cents per kWh depending on the time of year. The cost in the summer is different from the cost in winter. From May 1(summer) for six consecutive months the base rate is 11.4 cents per kWh (for a specific location), while in the winter from November 1 for six consecutive months the base rate is 17.1 cents per kWh. Okay, to calculate the cost for this summer month you multiply the baseline usage allowance of 10.4 kWh per day x 30 days = 312 kWh x .114 = $35.59. The next level of 101% to 130% of the baseline = 94 kWh x .129 = $12.13. The next level is 131% to 200% of the baseline = 169 kWh x 21.3 = $36.00, so the total for the month is $83.82. Notice that the last layer has a rate 86% higher than the base rate-certainly an incentive to monitor usage and conserve energy.
Each of the above users has its own rate structure and costs associated with energy usage. They are too numerous to get into for this writing and additional costs such as peak demand, power factor and stand-by costs all enter into some potential additional costs. One of the costs, power factor, is a cost that is created by the users of large electric motors and inductive equipment such as induction furnaces. Unplanned operations by such users can severely affect the utility company’s performance and must either be corrected by the user or they must pay a penalty. It is easy to see how difficult it is for the utility company to size the electrical system to meet the demands of the customers 24/7 when these businesses may only operate 8-10 hours a day. It is unfortunate that the utility company cannot store electricity. This means they must provide enough power at anytime during a 24-hour period. This requires them to constantly be turning generation equipment on and off not only to provide power but also to conserve on fuel. Peak demand, power factor as well as stand-by costs all have an effect on the performance of the electrical grid.