- by Todd Benadum
- August 21, 2023
- Dry Type Transformers, Padmount Transformers, Transformer Build Process
Replacing a failed transformer comes as an unwelcome surprise with an unanticipated and unavoidable expense. Facilities managers are immediately faced with two urgent questions — “How soon can we get power back?” and “How much is this going to cost?”
The answers depend on some key decisions made in replacing the transformer, but the urgency of the questions implies that both downtime and unanticipated costs need to be minimal. Depending on the volume of the operation and the potential revenue loss, these considerations may lead to shopping around for a replacement transformer with the lowest price, which could turn out to be an expensive mistake.
A power transformer is a long-life fixed asset that provides a stream of vital services to an organization over several decades. The Total Cost of Ownership (TCO) of this asset involves a stream of positive cash flows (savings) and negative cash flows (expenses) over its useful economic life. The purchase price of the replacement transformer is just one of those cash flows, which happens to occur at the beginning of its useful life.
There are others, such as installation costs, downtime costs, maintenance costs, savings from increased power efficiency and a longer useful transformer life. Moving forward, the relevant question is, what will be the TCO of the replacement transformer?
Choosing the Best Transformer Investment
The acquisition of a long-life asset is an investment decision that can be evaluated logically by financial methods such as Payback Period, Net Present Value or Return on Investment (ROI). In such an analysis, the purchase price is just one of several cash flows over time that affect investment performance. The purchase of a replacement transformer is not a short-term unanticipated “expense” but a decision to invest in a long-life asset. In comparing alternatives, the best investment is the one with the highest ROI.
Suppose the investment decision comes down to whether to invest in an ELSCO transformer with price PE or a transformer with similar specs from supplier X with a purchase price of PX. If PE happens to be greater than PX, does the initial price difference represent an avoidable cost or a good investment opportunity?
All transformer manufacturers technically have access to the same materials, the same manufacturing methods and the same best business practices — and potentially even the same designs. If they did everything the same, their unit costs would be about the same. In a competitive market, markups are similar, so offering prices closely reflect the relative cost of production. That means that the differences you see in prices result from differences in business strategy and choices. For the same transformer specs, the lower-priced supplier X must be leaving something out. What are they leaving out?
The Difference in ELSCO’s Transformer Designs
ELSCO designs and builds high-quality in its transformers, not out.
High-quality laminated steel core, copper conductors, Class R insulation, hand-wound and assembled construction and multi-stage testing cost a little more, but they pay off for our customers in higher reliability, longer useful life, lower TCO, and a positive ROI compared to transformers from other suppliers.
By investing in an ELSCO transformer, you receive not only a premium quality transformer that will save you money by providing highly efficient and reliable power for several decades, but you also receive a package of services that can easily save you more in up-front installation costs than the purchase price of the transformer.
When financial investment criteria are applied to the TCO of a quality ELSCO transformer, the result is almost always that choosing quality produces a significantly positive return on investment (ROI).
ELSCO customers care about our quality and service because it pays off on their bottom line. It is a good investment.
Installation Made Easy
Our high-quality dry type transformers offer much more than improved energy efficiency and extended life spans. By choosing ELSCO, you know your new unit is made for seamless installation into your existing setup, typically in four hours or less. Our engineers will work with you to ensure we understand your facility’s installation needs and provide a solution you can install immediately upon delivery.
If you require retrofitting or custom bus work to match your existing connections, we can manufacture the components and wiring to ensure a streamlined installation. We’ll also include the schematics and drawings outlining the step-by-step installation process. Our engineering team will be available by phone when you install your transformer to help answer questions and troubleshoot connection issues.
Transformer Designs That Maximize Safety
Another primary benefit of our medium-voltage dry type units is that they help maintain safety levels for potentially hazardous operating environments. Our assembly team encloses the transformer coils in an advanced varnish coating, helping to protect the system from moisture and minimize fire risk. Because our dry type designs do not contain combustible liquids, they provide a safer solution for chemical processing facilities, forestry applications, manufacturing plants and similar operations.
Our dry type units contain no materials that can leak and contaminate an operating area. Our transformers deliver virtually pollution-free operation, making them especially beneficial for applications sensitive to chemical or liquid contaminations. In addition, our robust designs, premium materials and superior craftsmanship deliver an extra margin of protection against stressors like overvoltages, short circuits, overloading and power surges.
Contact ELSCO Transformers Today for More Information
If you want to discover more about how our products and services can benefit your unique power application, the professionals at ELSCO can guide you. With our history of zero quality-related transformer failures, we are so confident in the performance and reliability of our transformers that we offer a five-year warranty on the purchase of new dry type transformers — four more years of coverage than the industry standard.