Turning Utility Penalties into Profit — A Factory’s $384,000 Turnaround
During a 179D qualification review, we discovered a $22,000/mo penalty and an additional $10,000/mo in avoidable demand charges. Advisory support focused on negotiation, demand balancing, and rate optimization — converting hidden losses into lasting savings.
Project Overview
While evaluating the facility for 179D eligibility, line-item bill forensics revealed excessive power-factor penalties and tariff-driven demand costs unrelated to total energy use. Nearly $384,000/year was bleeding out through billing mechanics.
Challenge
Poor power factor and clustered start-ups created short, expensive kW spikes. Coupled with a misaligned rate plan, the plant paid penalties and peak charges that far exceeded the value of the energy consumed.
Advisory Role & Approach
- Utility Negotiation: Coordinated with the utility to verify eligibility and remove/adjust penalty structures.
- Demand Balancing: Staggered major equipment start-ups and rescheduled process loads to flatten peaks.
- Rate Optimization: Selected a tariff aligned with operating profile to minimize exposure to demand windows.
- Ongoing Bill Audits: Implemented a periodic review framework to flag drift and billing anomalies.
Principle: Pair 179D engineering review with utility forensics — savings come from usage and billing.
Results
- Penalty Elimination: ~$22,000/month power-factor charges removed.
- Peak Reduction: >20% lower max kW; ~$10,000/month demand savings.
- Annual Impact: ~$384,000 recovered, verified on subsequent bills.
- Stacked Benefit: 179D tax deduction further offset project costs.
It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Or maybe you have a creative project to share with the world. Whatever it is, the way you tell your story online can make all the difference.
Make it stand out.
It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Or maybe you have a creative project to share with the world. Whatever it is, the way you tell your story online can make all the difference.
Make it stand out.
It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Or maybe you have a creative project to share with the world. Whatever it is, the way you tell your story online can make all the difference.
