The Cost of Compressed Air

Effective management of the cost of compressed air is essential in

today’s ultra competitive markets. There are two ways to define the
cost of compressed air
1. Unloaded cost
2. Loaded cost

Unloaded cost is as follows:

H.P. x .746 x Hours x Rate
Power Cost (Dollars) = ------------------------------------------
Motor Efficiency
Hours - The number of hours of operation.
H.P. - The power used to drive the compressor
Rate - The power rate (cents per Kw).
Motor Efficiency - The motor efficiency.
This formula is acceptable as accurate for estimating and comparison
purposes. (Your actual power bill can be further affected positively or
negatively by such things as power factor, demand charges, etc.)

The Magnitude of Power Cost (Electric)

To see the magnitude of your potential expenditure in power cost,
calculate the power cost of a 100 h.p. air compressor:
The three components of steam quality at point of use are:
6000 hours a year
Rate of $.07/Kw
Motor efficiency .90
(100) (.746) (6000) (.07)
Power Cost (Dollars) = ------------------------------------------
.90
Power Cost = $34,800 per year
A 1000 h.p. air compressor would have a $350,000 per year power cost

Determining Loaded Costs of Compressed Air

The above cost is an unloaded cost, which means there is no additional
cost of producing the compressed air put into equation. Unfortunately,
this is not true cost.
When you as a consumer of a utility in your home; purchase water,
natural gas or electric, is this an unloaded cost? No, all associated cost
to produce, distribute and maintain utility are included into the cost. All
other utilities have cost calculated at the loaded values, and then why
not do the same with compressed air. What is the additional cost? The
plant additional cost will vary depending on the operation and
accounting procedures. Here are a few examples:
 • Initial Cost of all components (compressor, air dryer, etc.)
• Water for compressors and aftercoolers
• Electrical (air dryers)
• Refrigerant (air dryers)
• Disposal costs for (refrigerant, desiccant)
• Desiccant cost (5 year change out)
• Compressor maintenance
• Dryer maintenance
• Filter maintenance
• Operational

The unloaded cost for a cfm, plus other associated cost will provide the
true cost of compressed air.

Every plant should have a document loaded cost for a CFM of

compressed air.

Typically the loaded costs are usually 1.7 to 3.1 times higher than the
unloaded cost.