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Backup Generators Make Financial Sense After Superstorm Sandy

December 4, 2012 By Jessica Lyons Hardcastle

While backup generators may not always be an easy sell, they prove invaluable during major power outages — like those caused by Superstorm Sandy — and some low-emission systems may give businesses better paybacks compared to traditional diesel generators, according to a Groom Energy blog.

On-site backup is a smart business decision, but some companies don’t want to invest in generators because they don’t have facilities where power outages are common, Groom Energy reports.

Also, while energy-efficiency projects show a measureable payback from energy savings, seeing financial returns on backup generators is not as clear. It requires putting a valuation on safety, assets at risk — such as perishable food housed in a warehouse or information in an IT data center, for example — and business continuity.

Groom Energy uses its customer Crystal Cold Storage, a cold storage services provider, as an example. It performed an assessment for adding backup generation at the company’s Texas facility, where the Electric Reliability Council of Texas (ERCOT) pays financial incentives to companies for low-emissions generators because they make the ERCOT grid more reliable.

Groom Energy says the low-emission backup system (pictured) cost $400,000, versus about $200,000 for a traditional diesel generator. But with ERCOT paying $150,000 per year to Crystal Cold Storage for its low-emissions system, the company receives a better than three-year payback on the purchase.

Also in the wake of Superstorm Sandy, limited supply and a huge demand for diesel fuel presented another challenge to data centers using diesel generators to power their operations, NewAge Data Centers reports. In the case of an outage, diesel generators can usually provide days or weeks of power, but only if the facility has the needed fuel.

Internap, for example, ran out of diesel and had to seek a refueling arrangement and workaround, according to Data Center Knowledge. Also, flooding destroyed the company’s diesel pumps.

Peer 1 Hosting extended its generator life by using a human bucket brigade in place of fuel pumps, the news source reports.

 



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