Determining the Cost of Electricity of a Natural Gas Generator

Nicholas Kenny, P.E. Extension Irrigation Specialist, Texas A&M University

As water well production

declines across many parts
of the Texas High Plains,
many pumping plants
currently using natural
gas engines are becoming
better suited for smaller
submersible pumping units
driven by electricity.

Infrastructure costs
associated with delivering
necessary electrical power
from the grid often make
this conversion to properly
sized, efficient pumping
plants an economic
compromise. An alternative
method for electrical power
delivery in these scenarios
is the installation of an on-
Natural gas Caterpillar 3306TA driving a Marelli three-phase
site natural gas generator
generator, providing power to three irrigation wells.
that can power multiple
smaller electrical pumping
plants.

The following information operation and maintenance grid to a pump location.

contains a basic method
for determining the fuel
costs associated with
producing electricity at
an on-site natural gas
generator. This cost can
be directly compared
to the market price of
electricity purchased from a
commercial provider.
To determine total
costs associated with on-
site power generation,
expenses and amortized
capital expenses tied to
the purchase of the natural
gas generation unit also
must be considered. For
practical comparative
evaluations, the capital
expenses associated with
on-site generation usually
are similar to or less
than the capital expenses
related to delivering
power from the existing
commercial electrical
Further, comprehensive
maintenance costs
associated with one natural
gas generator typically
are much less than the
costs associated with
multiple natural gas wells.
Upgrade costs at individual
pumping plants also will
need to be included in a
comprehensive economic
evaluation related to this
conversion.

1 LSU AgCenter Pub. 3241-D: Determining the Cost of Electricity at a Natural Gas Generator
The following information
evaluations, the capitalcontains a basic
expenses method
associated for on-site
with determining the fuel
generation costs are
usually associated
similar with
to orproducing
less than electricity
the capitalatexpenses
an
on-site natural gas generator. This cost can be directly compared to the market price of electricity purchased
related to delivering power from the existing commercial electrical grid to a pump location. Further, comprehensive from a
commercial provider.
maintenance costs associated with one natural gas generator typically are much less than the costs associated with multiple
natural gas wells. Upgrade costs at individual pumping plants also will need to be included in a comprehensive economic
To determine total
evaluation coststoassociated
related Method
with on-site
this conversion. powerof Calculating
generation, Costs
operation and maintenance expenses and amortized capital
expenses tied to the purchase of the natural gas generation unit also must be considered. For practical comparative
Measure the elapsed time in seconds for consumption
evaluations, the capital expenses associated with on-site generation usually are similar Naturaltogas
orCaterpillar
less than3306TA
the capital expenses
driving a Marelli three-
of a specified
related to delivering power from thevolume of naturalelectrical
existing commercial gas (the gridlonger the
to a phase
pump location.
generator, Further,
providing comprehensive
power to three irrigation
interval with
maintenance costs associated is, the moregas
one natural accurate
generator this measurement
typically are much less willthe costs associated with multiple
than
wells.
natural gas wells.
Method
be). This
Upgrade
of Calculating costsmeasurement is used
at individual pumping
Costsy plants to
alsocalculate
will need tothe rate of in a comprehensive economic
be included
evaluation related tonatural gas consumption. As a note, most natural gas
this conversion.
meters
Measure the elapsed time in the Texas
in seconds High Plains
for consumption requirevolume
of a specified that of
a natural
displayedgas (the longer the interval is, the more
Natural gas Caterpillar 3306TA driving a Marelli three-
reading is multiplied by a correction factor
accurate this measurement will be). This measurement is used to calculate to account
the rate of for gas
natural
phase generator, providing consumption.
power As a note,
to three irrigation
local conditions (for example: gas temperature,
most natural gas meters in the Texas High Plains require that a wells. altitude,
displayed reading is multiplied by a correction factor to
account for local conditions (for
pressure, example: gas temperature, altitude, pressure, etc.).
etc.).
Method of Calculating Costsy

1

Measure the elapsed
1.
time in
secondsfor
consumption
3600 of a specified volume of natural gas (the longer the interval is, the more
accurate this measurement will be). This
measurement is used to calculate the rate of natural gas consumption. As a note,
most natural gas meters in the Texas High Plains require that a displayed reading is multiplied by a correction factor to
Where: NGcons = natural gas consumption in cubic feet per hour (ft3/hour)
account for local conditions (for example: gas temperature, altitude, pressure, etc.).
VolNG = volume of natural gas consumed during the specified time period (ft3)
Time = elapsed time (seconds)

1. 3600

Calculate the hourly fuel cost of the natural gas generator:
Where: NGcons = natural gas consumption in cubic feet per hour (ft3/hour)
VolNG = volume of natural gas consumed during the specified time period (ft3)
2.
Time = elapsed time (seconds) /1000
cost
Calculate the hourly fuel of the natural gas
Where:generator: NG Cost= cost of natural gas consumed per hour of operation ($ / hour)
Calculate the hourly fuel cost of the Cost
NG unit =
natural purchase
gas price of natural gas per thousand cubic feet ($ / thousand cubic feet)
generator:
NGcons = natural gas consumption in cubic feet per hour (ft3/hour)
2. 2 using
Measure the electrical production of the generator
/1000
a properly rated, true-rms digital clamp meter. The measurements
necessary are AC volts and current in amps. It often is worthwhile to measure all three electrical legs to ensure balanced
power production andNG
Where: useCost= cost of natural
the average voltagegas
andconsumed
amperageper hour of (These
readings. operation ($ / hour) are for three-phase power (the
calculations
NG Cost = purchase price of natural gas per thousand cubic
calculation for single-phase power does not include the square-root of three factor.)
unit feet ($ / thousand cubic feet)
NGcons = natural gas consumption in cubic feet per hour (ft3/hour)

Measure the electrical production of the generator using a properly rated, true-rms digital clamp meter. The measurements
necessary are AC volts and current in amps. It often is worthwhile to measure all three electrical legs to ensure balanced
power production and use the average voltage and amperage readings. (These calculations are for three-phase power (the
Measure
calculation for single-phase thenot
power does electrical
include theproduction
square-root of of the
three generator
factor.)
using a properly rated, true-rms digital clamp meter. The
measurements necessary are AC volts and current in amps.
It often is worthwhile to measure all three electrical legs
to ensure balanced power production and use the average
voltage and amperage readings. (These calculations are for
three-phase power (the calculation for single-phase power
does not include the square-root of three factor.)

Exercise extreme caution when working

around all agricultural electrical circuits!

2 LSU AgCenter Pub. 3241-D: Determining the Cost of Electricity at a Natural Gas Generator
 Exercise extreme caution when working around all agricultural electrical circuits!
Determine the power generated by the generator in
kilowatt hours per hour (kwh / hour).

Determine the power generated by the generator in kilowatt hours per hour (kwh / hour).

33.
Exercise extreme caution when working around all agricultural electrical circuits!



Exercise extreme caution when working around all agricultural electrical circuits!
Where: Power = kilowatt hours per hour generated (kwh / hour).
Determine the power generated by the generator in kilowatt hours per hour (kwh / hour).
V = output voltage generated (AC volts)
I = output current generated (amps)
PF = of the generator in decimals (typically 85 percent or .85)
power factor
Determine the power3. generated by the
generator in kilowatt hours per hour (kwh / hour).

Calculate the cost of power:
= kilowatt hours per hour generated (kwh / hour).
3. Where:
PowerV = output voltage generated (AC volts)

4. current generated (amps)
I = output

Where: Power = kilowatt
PF = powerhours per hour
factor of thegenerated
generator(kwh / hour). (typically 85 percent or .85)
in decimals
Calculate the cost of power:
V = output voltage generated (AC volts)
the costI of
CalculateWhere: = output current
power:Elec generated
Cost= (amps) cost in dollars per kilowatt hour ($ / kwh)
unit electrical
PF = power factor of the generator
NG Cost = natural gas cost inper
decimals
hour ($(typically
/ hour of85 percent or .85)
NG)

4
4. power: Power = electrical
power generation rate (kwh / hour)
Calculate the cost of
Example

4.
gas generator setElec
A naturalWhere: Cost=

with an 85unit electrical
percent power cost in dollars
factor per kilowatt
is generating hour ($
480 volts / kwh)
with a system current load of 120 amps
from two pumping plants. NG Costgas
Natural = natural gas costfrom
is purchased per hour ($ / hour
an off-site of NG)
supplier at $5 per thousand cubic feet. Measurements of
natural gas show that 20 cubicPower = electrical
feet poweringeneration
are consumed a 50-second rateperiod.
(kwh /Determine
hour) the unit electrical power cost associated
Where: Elec
with this generator set.Cost= unit electrical cost in dollars per kilowatt hour ($ / kwh)
Example NG Cost = natural gas cost per hour ($ / hour of NG)
Power = electrical power generation rate (kwh / hour)
Example
A natural gas generator set with an 85 percent power factor is generating 480 volts with a system current load of 120 amps
Example from two pumping A natural
plants. gas
Natural
generator set with
gas is purchased from anoff-site
an 85
percent
supplier atpower
$5 per thousand cubic feet. Measurements of

1.
natural gas
show that
factor 20
cubic
is generating feet
are
consumed in a 50-second
480 volts with a system current load
period.
Determine
the unit power cost associated
electrical
A naturalwith
gas generator set
this generator with
set. an 85 power factor is
percent generating 480 volts with a system load of 120 amps
current
of 120 amps from two pumping plants. Natural gas is
from two pumping plants. Natural gas is purchased from an off-site supplier at $5 per thousand cubic feet. Measurements of
purchased from an off-site supplier at $5 per thousand cubic
natural gas show that 20 cubic feet are consumed in a 50-second period. Determine the unit electrical power cost associated
with this generator feet.
set. Measurements of natural gas show that 20 cubic feet

are consumed in a 50-second period.
Determine
the unit


2.

electrical
1.
power

cost
associated


with
this

generator
set.




1 1.







3.

2.

2 2.


4.


3.

3 3.







4.

4 4.

3 LSU AgCenter Pub. 3241-D: Determining the Cost of Electricity at a Natural Gas Generator
 www.LSUAgCenter.com
Louisiana State University Agricultural Center
William B. Richardson, Chancellor
Louisiana Agricultural Experiment Station
John S. Russin, Vice Chancellor and Director
Louisiana Cooperative Extension Service
Paul D. Coreil, Vice Chancellor and Director

Pub. 3241 D (200) 7/13

The LSU AgCenter is a statewide campus of the LSU System and

provides equal opportunities in programs and employment.

4 LSU AgCenter Pub. 3241-D: Determining the Cost of Electricity at a Natural Gas Generator