Selecting the best motor and equipment involves thinking beyond traditional approaches. In involves considering a wide range of options before you buy, which can save you thousands of dollars. An electric motor bought for $1 600, for example, may cost as much as $13 000 a year to run, and amount to a total operating cost of $195 000 over a 15-year lifetime. Careful selection can reduce the total operating cost by as much as $16 000, or ten times the initial purchase price.

This section walks you through a best practice system of motor selection which will lead you to make the right decisions. It will help you avoid acting on assumptions and making decisions that may not be in the best interests of your organisation. It will steer you away from making decisions based on purchase price only, or on simple pay back options. Although the information provided is generally directed toward motor purchases, the same principles can be applied when selecting other energy consuming equipment.

The section covers:

• life cycle cost analysis, including purchase price, operating costs and time value of money

Life cycle cost analysis

When selecting motors and equipment using best practice principles, you should begin by analysing life cycle costs, or the 'real' cost of ownership. In the case of motors, this is critical since your three-phase induction motors can consume more than half the energy used by your plant.

Life cycle cost analysis is a proven and accepted financial principle, which involves:

• assessing purchase price
• assessing operating costs
• using a method which accounts for the time value of money.

Electric Motors can help you simplify the process of selecting three-phase induction motors and to save you time and money. You can contact Electric Motors and we'll help you through the process and also help you compare the life cycle costs of the various models and types.

Purchase price

When assessing the purchase price of an electric motor, you need to consider issues like different models and suppliers, warranties, quality, expected lifetime and type of motor. For example, the price of an electric motor may vary widely between models and suppliers. If you are a high user of electric motors from a regular supplier, you may receive a good discount.

Usually, but not always, the consumer adage 'you get what you pay for' applies. Cheaper motors are often less efficient and of poorer quality, and they may be less reliable and have shorter lives. This is often reflected in the warranty. Even in cases where you are only considering one brand, there is still a choice between standard and high efficiency motors. Be careful to analyse the life cycle cost of your options - a few extra dollar spent at the time of purchase may save you thousands in the years to come.

Operating costs

When determining how much it will cost to operate a piece of equipment over its lifetime, you must:

1. estimate the expected load on the equipment through production cycles (load profile)
2. chart the motor's efficiency rating at each load point (efficiency profile)
3. chart the amount of electricity the equipment requires to operate at that level of efficiency (energy required profile)
4. combine your energy required profile with your tariff information to calculate your true operating costs.

Using Electric Motors will also help you break through 'myths' associated with equipment selection. Many believe, for example, that the least expensive motor is the most cost-effective. The reality is that machine design and the type of control system may also have a big impact on operating costs. Careful analysis often demonstrates that in the long term the cheapest option is not the best option.

Another common myth is that buying a more efficient motor automatically means you will use less energy. Sometimes motors with higher efficiency may run at slightly higher speeds. In centrifugal pump and fan applications, for example, the energy consumed is proportional to the speed cubed. Therefore, small increases in speed can increase your energy consumption significantly.

The truth behind these myths proves that your decision to buy one motor over another should not be based only on purchase price or efficiency.

Time value of money

To determine how costs and benefits spread out over the lifespan of a piece of equipment, use accepted discounted cash flow techniques. This time value of money method puts a present value on future benefits or costs.

It is recommended that you use this method (rather than simple payback) when analysing equipment options since simple payback ignores the full value of future benefits. Motors generally have a long life of between 15 and 25 years so analysing options using simple payback may neglect 23 years of savings opportunity.