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17/06/2011
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This Q&A is regarding the implementation of new regulation for industrial motors in the EU.
 What is the new regulation?
The EU MEPS (European Minimum Energy Performance Standard) scheme covers most single speed, three-phase induction motors from 0.75 kW up to 375 kW. It will come into effect in three stages from June 16 onwards. Under the scheme manufacturers are required to show the IE (International Efficiency) class and efficiency values on motor rating plates and in product documentation. EU MEPS is based on two IEC (International Electrotechnical Commission) standards. As EU MEPS is based on international standards, it represents an important step towards harmonization of efficiency regulations on a global scale.
Why is this important?
The new EU measures will save as much electricity per year by 2020 as the current annual consumption of 32 million EU households. Electric motors consume about 45% of all electricity produced, which means that about every second power plant is just powering electric motors. All motors in the world consume twice as much electricity as lighting. The new EU regulation is expected to save about 135 TWh by 2020, which is equivalent to the output of 22 nuclear reactors.
Who says that it matters?
The International Energy Agency (IEA) estimates in a recent study that it is possible to cost-effectively save 20 to 30 percent of all power consumed by electric motors using existing technologies such as high-efficiency motors and drives. This saving corresponds to 10 to 15 percent of all global electricity consumption. An Economist Intelligence Unit survey commissioned by ABB showed that despite their apparent economic advantages it requires policy makers to ensure widespread use of energy efficient equipment. (Promote our survey!)
What does ABB do to improve the energy efficiency of motors?
ABB offers a full range of high-efficient motors. (See motors brochure). Further, ABB continues to invest in motor technology and recently introduced at the Hanover Fair, last April, a new technology that significantly reduces the losses in electric motors by up to 40%.. Based on this new technologies ABB offers two series of motor-drive packages (the motor cannot operate without a drive): a high-efficient package and a high-output package that will be gradually made available for sales during this year. Local sales can start when product data is available and the people have been trained.
What is the impact for ABB?
We expect demand for industrial motors to grow between 5 – 10% per year globally in the next few years, driven by higher investment need in energy efficient equipment.
What is the financial benefit of buying a new energy efficient motor from ABB?
Attractive payback time: using high energy efficiency motors reduces the costs of the company using them; electricity consumption accounts for ~95% of a motor's life cycle costs, payback times for high efficiency motors are therefore relatively short, 2 years in average, a few months for certain applications.
How does the recent acquisition of Baldor fits in?
Like the EU, other countries and regions are introducing minimum efficiency standards. In the US new regulation came into force on December 19, 2010. Baldor has complete range of high-efficienct NEMA motors and can help its customers to comply with the new regulation. Baldor's range of motors is complementary to ABB's and together the two companies can better help their customers to serve their customers and save energy than any of them could do on its own. For a company with a complete portfolio of high-efficient motors like ABB the focus on energy efficiency and the new regulations offer huge opportunities.
What is the financial impact for ABB's business due to this new regulation?
We don't comment on specific financial forecasts.
Why are minimal standards so important, shouldn't all factories buy anyway more energy-efficient motors which may be more expensive but will save money in the future?
Yes, but usually the people who buy the motors are just concerned with the initial investment, wheras the operational costs are paid from another budget. Due to this split responsibility is difficult for many companies to account for the total lifecycle costs. Minimum efficiency standards are a means to overcome this problem of split incentives. We have seen the effect of the new standards on demand already in the U.S., where new minimal standards were introduced in late December.
What is the impact of the decision of Germany to exit nuclear power on energy efficiency?
With the uncertainty concerning the future of nuclear power, the need to invest in energy efficiency is greater than ever before.
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Author
ABB Ltd
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