No utility will move forward with a large project without some sort of financial justification. There are a few ways to transform pilot data from a trial with S&C’s TripSaver® II Cutout-Mounted Recloser into a business case for wider deployment. It’s worth considering multiple financial models to assess big-picture savings.
4 Financial Models to Consider
Payback
This is how quickly you recoup the costs of buying and installing TripSaver II reclosers. Because TripSaver II devices significantly reduce operations and maintenance expenses (particularly truck rolls), typically utilities see payback within a few years—a stark contrast to the payback for a typical AMI overhaul, which averages a dozen years!
Cost to Customers
While there are obvious costs to you as a utility, outages cost your customers as well. Especially if convincing your communities will be an important step in moving forward with a widescale TripSaver II recloser deployment, see how much outages cost both your residential and commercial/ industrial customers using the Department of Energy’s Interruption Cost Estimates (ICE) Calculator: icecalculator.com.
Total Cost of Ownership (TCO)
TCO considers both the purchasing price as well as maintenance and operation costs over time. For example, you may be considering a lower-cost product, but it requires significant upgrades and care from year to year. If these upkeep costs are high or frequent, you may actually save money by purchasing a more expensive product that doesn’t require as much maintenance.
Net Present Value (NPV)
NPV measures the profitability of an investment over time. Sometimes short-term or quickly profitable projects seem to be no-brainer decisions, but often the higher cost, up-front investment reaps greater value in the long run. NPV allows you to determine which decisions have a more profitable, long-term potential and translate a holistic investment’s value into today’s dollars.
Show the Value, Secure the Buy-In
Transforming pilot data into a strong business case requires evaluating multiple financial models. Payback, cost to customers, total cost of ownership, and net present value each offer unique insights into short- and long-term benefits. Using these metrics helps utilities justify investment in TripSaver II reclosers and demonstrate their value to stakeholders.
EXPERT TIP Are you underestimating truck roll costs? There’s the cost of the truck to consider, including the gas and insurance. Plus the wages for your crews might spike into hazard or overtime pays brackets (including unused time for overtime minimums) because truck rolls often occur during severe weather.