Electrical System


Electricity is a public good that is used for a very broad range of applications. A typical electrical distribution facility in an industry will in general include the following:

  • Power distribution systems for manufacturing and process equipment, including indoor sub-station, plant distribution, process control systems, building electrical service systems and protection systems
  • Power outlet system for movable equipment, material-handling systems, transportation system
  • Auxiliary systems like air-conditioning & refrigeration, compressed air system, lighting, fire alarms systems, communication and computer based equipment.
  • Maintenance, canteen and medical facilities
  • DG sets and/or Co-generation equipment

As electricity cannot be economically stored on a large scale, it has to be produced at the same moment and in the same quantity that is actually requested and has to be transmitted instantaneously from the power generator to the user via transmission lines. Because of these special features, the electricity supply system has to be designed for the maximum expected demand.

However, depending on the power grid supply can be critically when the supply is not reliable and power outage like load shedding are frequent. Generating electricity by Diesel gensets during load shedding is very costly and increases production cost considerably. Therefore, it makes sense to look into the utilities that demand electricity in order to find wastage.

Based on this principle, Demand Side Management techniques have been developed to influence the electricity demand and increase the utilisation and operating efficiency of existing supply facilities, thus delaying the need for new capacity and reducing the operating costs.

Electric Load Management or simply called Load Management is a specific method of controlling the peak load in the electrical system in order to produce a constant demand. It can be defined as any action to change the load profile in order to gain from reduced total system peak load, increased load factor and improved utilisation of valuable resources like fuels or generation, transmission and distribution capacity.

Practicing load management has many advantages. Some of them are mentioned in the following:

  • Load management avoids the requirement to increase transformer, cable sizes and generator capacity
  • Load profile is generally more efficient, controlling peaks
  • Decreasing peak load reduce need for bigger backup systems like diesel generators.
  • Steady load without extreme peaks prevents diesel generators from damage through overloading
  • As peaks are likely to coincide with periods of most expensive electricity prices, either individual industries will become more competitive or prices will be forced downwards
  • It is environmentally more acceptable due to an effective use of resources.

Under “Energy Efficiency” more technical details are given on how to practice effective load management.

Payback of energy saving options

Experience from the past have shown that energy auditing of electrical system is highly profitable. The following table shows some of the energy saving options with the respective payback of investment:

Table 1: Payback of investment for improving energy efficiency in electrical system (ESPS, 2005)



Electrical load management


In industrial type electricity billing system, where mostly a two-part tariff is adopted, the consumer pays for two components of electricity bill namely: maximum demand (kVA) recorded and energy consumed (kWh). Electrical load management for an industry involves measures to reduce maximum demand and to improve power factors so that the maximum demand charges are minimized along with the losses. Energy consumption mainly relates to end-use equipment efficiency and can be reduced by various relevant measures.

Maximum Demand Basis

Maximum demand charges relate to the fixed cost of capacity blocked to be provided for serving a consumer’s needs. A tri-vector meter installed at the consumer end records the maximum demand registered by a consumer during billing duration, apart from other important consumption features like active power (kWh), reactive power (kVarh), apparent power (kVah), and power factor (PF). At present many utilities have a “time of day tariff” in place, and charge a consumer variable rates for maximum demand drawn during different times of day. For instance, there could be lower rates for night hours when the utility is lightly loaded and higher rates during evening peak hours when utilities are stretched to meet maximum load demands. It would thus help to study the load curve patterns and, based on prevalent tariff structure provisions, optimize maximum demand to save on maximum demand charges.

Load curve of a plant

From below figure 1, one can see that demand varies from time to time, due to the combination of users and consumption of electricity changing all the time. The demand is measured over a predetermined time interval and averaged out for the interval as shown by the horizontal dotted line.

Figure-1: Maximum demand curve (APO, 2010)

Maximum Demand (MD) recording

It is important to note that while maximum demand is recorded, it is not the instantaneous demand drawn, as is often misunderstood, but rather is the time-integrated demand over the duration of the recording cycle. As example, in an industry, if the draw over a recording cycle of 30 minutes is:

  • 2500 kVA for 4 minutes
  • 3600 kVA for 12 minutes
  • 4100 kVA for 6 minutes
  • 3800 kVA for 8 minutes

Figure 2: Time-integrated demand (APO, 2010)

Various techniques applicable to optimize maximum demand of an industry include:

  • Rescheduling loads;
  • Staggering of motor loads;
  • Storage of products/in process material/process utilities like refrigeration;
  • Shedding of non-essential loads;
  • Operation of captive power generation; and
  • Reactive power compensation.
  • Rescheduling and Distributing Loads

In figure 3 the left side shows the demand curve of a consumer before load shifting, and the right side shows the demand curve of a consumer after load shifting (leading to kVA reduction).

Figure 3: Load Shifting (APO, 2010)

The electrical load shifting and distributing can help in minimizing the demand shoot that could otherwise happen for a short duration and increase the energy bill to the industry. Some of the examples of load shifting and saving of monetary value to the industry are as follows

  • Making up Ice bank during off-peak hours in the dairy industries and optimizing the maximum demand during peak hours.
  • Operating bakery section during off-peak hours to optimize the maximum demand during peak hours and also reduce the energy cost in bakery and hotel industries.
  • Pumping and storage of water need during the off-peak hours and reduce corresponding demand during peak hours.
  • Similarly in the Hydrolysis process of the Oil industry, the storage of hydrogen during the off-peak time can reduce corresponding demand during peak hours and reduce the energy cost.

Power factor improvement

Power factor is defined as the ratio of real power to apparent power. This definition is often mathematically represented as kW/kVA, where the numerator is the active (real) power and the denominator is the apparent power (active+ reactive).

How to improve Power Factor

Power factor can be improved by adding consumers of reactive power in the system like Capacitors or Synchronous Motors. It can also be improved by fully loading induction motors and transformers and also by using higher rpm machines. Usage of automatic tap changing system in transformers can also help to maintain better power factor.

Benefits of Capacitor Bank Installation

  • Reduction in voltage drop thereby reduced kVA demand
  • Elimination of penalties toward poor power factor
  • Improved System Efficiency thereby reduction of electricity bills
  • Extended equipment life:- reduced electrical burden on cables and electrical component
  • Environmental benefit: - reduction of power consumption due to improved energy efficiency. Reduced power consumption means less greenhouse gas emissions.

Figure 3: Principle of capacitor bank installation

Example: If maximum demand is 1500 kVA at 0.8 PF, calculate the reduction in demand with improved PF to 0.95, and work out the cost benefits of PF improvement. (Suppose: Per kVA demand charge = NRs 230/kVA, Capacitor Purchase Cost= NRs 1,000 per kVAR)



Improving Electrical System Efficiency

  • Review the tariff agreement with the utility to meet requirements at optimum cost.
  • Schedule plant operations to maintain a high load factor.
  • Shift loads to off-peak times where possible.
  • Minimize maximum demand by controlling loads through an automatic demand controller.
  • Stagger start-up times for equipment with large starting currents to minimize load peaking.
  • Use standby electric generation equipment for on-peak high load periods.
  • Correct power factor to well above 0.90 by installing additional capacitors and automatic power factor controllers, avoid motor under-load conditions, and take advantage of PF improvement incentives if any are available.
  • Ensure that all capacitors are in line and functional, by checking charging current and fuse condition.
  • Relocate transformers close to main loads.
  • Set transformer taps to optimum settings.
  • Disconnect primary power to transformers that do not serve any active loads.
  • Consider efficient on-site captive generation or cogeneration based on cost benefits with highest steam parameters.
  • Export power to grid if there is any surplus in captive generation if cost benefits permit.
  • Periodically, calibrate the utility’s electricity meter with your own meter for accuracy.
  • Shut off unnecessary and idle process equipment, utilities, and office equipment like computers, printers, and copiers at night.
  • Properly size to the load for optimum efficiency. (High-efficiency motors offer 4%–5% higher efficiency than standard motors.)
  • Use energy-efficient motors where economical.
  • Use synchronous motors to improve power factor.
  • Provide proper ventilation. (For every 10ºC increase in motor operating temperature over the recommended peak, the motor life is estimated to be halved.)
  • Check for under-voltage and over-voltage conditions.
  • Balance the three-phase power supply. (An unbalanced voltage can reduce motor input power by 3%–5%.)
  • Demand efficiency restoration after motor rewinding. (If rewinding is not done properly, the efficiency can be reduced by 5%–8 %.)
  • Use variable-speed drives for large variable loads.
  • Use high-efficiency gear couplings.
  • Use precision alignment.
  • Check belt tension regularly.
  • Eliminate variable-pitch pulleys.
  • Use energy efficient belts as alternatives to old v-belts.
  • Eliminate inefficient couplings.
  • Shut the loads off when not needed, adopting interlocks, controls.

Further readings

Electric load management in Industries - The objective of this e-book is to give the readers an overview on how load management can be best implemented by industrial electricity users. The content of this brochure is specially focused on typical applications in the small and medium sectors of industry. However, the brochure will also be of interest to utility marketing and distribution personnel, energy consultants and process and equipment manufacturers.

Training Manual on Energy Efficiency for Small and Medium Enterprises - This is a publication of Asian Productivity Association (APO) that contains a detailed chapter on energy efficiency in electrical systems. Furthermore, relevant technical information on energy efficiency in industries is given in a very practical and easily understandable way. This handbook makes implementation of energy saving options very easy for Asian's SMEs.