Simple and Cheap Can Be Costly
One of our clients, a hardwood flooring manufacturer, faced a happy dilemma: the company had experienced rapid growth in the last five years and needed more space. They decided to double their manufacturing production by expanding one of their facilities.
When it came time to add utilities, the simplest and cheapest option was to add a second transformer and separate electrical service and meter for the new space. When construction was complete, the facility had two meters, each with a measured demand between 600 and 1,100 kilowatts.
But there was a cost to this simple and cheap solution. To recoup their construction and maintenance costs, the utility company charged a monthly facility fee, administration fee, and meter charge . . . for each meter. Saving a little cash during construction cost the manufacturing company $68,000 a year in utilities fees.
A Simple Solution for Savings
The manufacturing company contacted SM Engineering to discover why their utility bills were so high. That’s when our experts discovered the dual meters and electrical services. We combined the two meters and negotiated a more favorable rate for our client.
To do so, the company had to invest in five power electrical poles to tie the services together for a one-time installation cost of $60,000. But with the $68,000 in annual savings from combining the services, our client recouped the cost of the installation in just 11 months. They’ll enjoy the utility savings for years to come.
The Moral of the Story
The moral of the case of too many meters is to do your homework. Don’t add another meter until you’ve investigated the long-term costs of doing so. SM Engineering can help you uncover utility savings and anticipate future costs. Contact the experts at SM Engineering today.
