Rob Morris, UK Country Manager for Powervar explores the draining effects of ‘bad power’ on both economic and electrical resources and how this is being remedied with effective power protection systems
Many businesses are now waking up to the fact that power quality is a significant issue when it comes to the negative effect of power disturbances, such as electrical noise and voltage impulses, on sensitive electronic systems. However, problems arise when we try and work out exactly how much bad power is costing us, and the cost benefit of rectifying these problems. Simply put, how can you establish the Return on Investment (ROI) when selecting different power protection systems?
For most companies, power quality problems remain ‘out of sight, out of mind’. While the frequency of spikes, surges and other phenomena in power distribution is generally understood, many do not understand the effect these problems can have on the bottom line.
In recent years companies such as Powervar have worked closely with customers to identify a technique to help quantify and educate the industry about calculating real ROI.
A major focus has been about understanding what has been termed, the ‘service burden rate’ – this is the proportion of the price of a product allocated to cover on-going maintenance and repairs during warranty period.
Wide–ranging research carried out by the company found that the typical service burden rate ranged somewhere between 4 and 8 per cent of the price of the equipment or solution. But results gathered from more than a thousand pieces of equipment installed by the company’s customers showed a reduction of between 43 and 88 per cent in warranty service costs.
Even accounting for the cost of buying the power protection equipment, the ROI in these applications varied between 154 and a top level of 1,148 per cent.
Challenging the quality of power
Whether the power is externally generated or produced onsite, power quality continues to be problematic for today’s sensitive electronic equipment.
Even in developed countries, the power from utility companies still meets standards set in the very earliest days of electricity. This was largely adequate until hi-tech equipment incorporating sensitive components like integrated circuits came along.
On average, power supplies in the US and other developed nations experience about 8.8 hours of outage each year. Less visible is the annual average of 79 hours in which the quality of power is not satisfactory.
Over the course of an entire year, these incidents can cause repeated and costly damage or failures.
Power irregularities such as these are not always immediately fatal to equipment, but over time can result in cumulative damage that will eventually cause sudden system failure or lock-up without advanced warning.
As soon as one component is replaced, the cycle begins again and it’s only a matter of time before the failure is repeated.
Key to delivering a higher ROI for OEMs is a direct and fast reduction in the service burden. As a company, Powervar focuses on equipment reliability and uptime on the one hand, while reducing operational and service costs on the other.
A large number of service problems result in ‘no trouble found’ service calls, often caused by power quality problems. The ability to reduce these calls has a positive impact on warranty costs and customer satisfaction.
By reducing service costs by up to 88 or even by 43 per cent, customers are saving millions in some cases. What’s more, the average number of helpdesk calls dropped by 60 per cent. These are savings that every business wants to achieve.
Of course, power quality is not the only factor impacting the service burden rate. There are various software, training, hardware and personnel issues that can also play a role, but addressing and eliminating the ‘hidden’ problems caused by power fluctuations frees up time and resources to sort out other important areas.
Control and protection variables
Controlling the power variable and protecting the equipment’s processes will significantly increase ROI in a number of key markets, including medical and healthcare; analytical instrumentation; banking and retail; electronics manufacturing; graphics and printing and various others.
The common element in all of these sectors is that an improved ROI is not just about savings, but also about these ‘softer’ benefits as well – reduced service calls, customer satisfaction and competitive edge.
Over the years, the power quality market and associated UPS business, which is highly competitive and largely driven by price, has been unable to demonstrate to customers how much power disturbances are costing their business and how power conditioning technology can deliver savings directly to the bottom line. However there is clearly a financial case for investment in such equipment.