I was recently looking at natural gas standby generators on the Costco website. Given the current electricity rates during peak Time of Use hours, I then started wondering what the cost per kWh was for a natural gas standby generator. Especially considering how low the natural gas prices have been.
So let’s do some math. Fun!
According to EnergyShop.com, natural gas is currently 25.04Â¢/mÂ³ in my area. That includes all of the “add ons” that are over and above the posted natural gas rate. It excludes taxes though. As we saw before, your real electricity rate is not the same as what is “advertised” by Hydro One. We need to add in a number of extra charges to get the real rate. With the recent switch to the summer Time of Use pricing, the advertised rates increased.
Based on the currentÂ Hydro One Residential Delivery Rates, the real Time of Use prices are (based on Urban High density)Â 12.01Â¢/kWh for off-peak,Â 15.24Â¢/kWh for mid-peak andÂ 17.18Â¢/kWh for peak usage. Again, these are the rates without taxes added (and minus some monthly charges that don’t translate well into a per kWh price).
So, let’s take the GeneracÂ 17 kW Standby Generator that is available on the Costco website, and figure out the cost per kWh. According to the website, it is capable of producing 16kW using natural gas and consumes 6.9mÂ³/h at full load. So, that translates to 2.32kWh/mÂ³ at full load.Â Given the current natural gas rate in my area, that means the standby generator costs 10.80Â¢/kWh. Â WHAT?
Well, hang on, let’s not get too carried away with this. Natural gas prices are currently at all time lows. Â Let’s see how much it would cost with the ~50Â¢/mÂ³ that we were paying a couple years ago. Â At that price, the generator costs 21.55Â¢/kWh to run.
Let’s not forget about the cost of the generator – $3699.99 plus around $1000 of installation/other costs (based on some rough numbers I found while Googling). To cover that, you’d have to run the “standby” generator at full load during Time of Use on-peak time for about 67142 hours all while hoping that the natural gas price doesn’t go up. Oh, and don’t forget that peak time is only for about 6 hours a day and only 5 days a week.
Oh well, that satisfied my curiosity.
Well, almost. Â I poked around a bit and found a couple industrial natural gas generator sets. Unfortunately most of the large scale (2500kW – 3000kW) units I found didn’t have fuel consumption values. The $500k for a used (with no warranty) 3000kW generator set was interesting. (Yikes!)
I did manage to find the Kohler PowerÂ 400RZX which is 400kW natural gas generator. It’s capable of around 3.3kW/mÂ³ at full load or a cost of 7.5Â¢/kWh. Of course, no price is listed so I’m going to assume its payoff time would be greater than the 67000+ hours of the Generac unit.