Solution:
The club’s high thermal load immediately suggests the use of co-generation as a means for possible energy savings. A co-generator is simply an electrical generator that captures the waste heat from the generator prime mover, and uses it in other processes in the facility. This capture and utilization of waste heat is the key to understanding the economics of these machines.
For example, assume that the club requires 6,250 gallons of #2 heating oil per month for space and water heating and 57,600 kWh of electricity to run the facility.
They key to understanding the co-generation opportunity is to realize that a central generating station (i.e.: the electric company’s equipment) must purchase 1,420 gallons of fuel oil equivalent and combust it to provide energy to drive a turbine, which in turn, drives an electrical generator. In this process the generating station loses 910 gallons equivalent or approximately 64% of the energy of the fuel as unrecoverable waste heat. The remaining 36% (511 Gallons) is converted to electricity and sold to the club. But the club pays for 100% of the processing costs...in other words, the health club pays for the electric company’s inefficiencies.
| Monthly Energy Costs Before Cogeneration: |
| Fuel Oil: 6,250 gallons @ $2.60 per gallon |
= $16,250 |
| Electricity: 57,600 kWh at kWh rate of 0.12 |
= $6,912 |
| Total Energy Costs |
= $23,162 |
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