Transformer Economic Evaluation

Inherently high transformer efficiencies have caused little concern for transformer loss costs in the past, but increasing energy costs in recent years have resulted in greater sensitivity to these losses. Since lower losses are realized through greater investment in engineering effort and material selection, the low-loss transformer is usually obtained at a premium price. Justification of this premium price through energy savings is the reason for the economic evaluation methods presented. Transformer loading, expected increases in utility charges, taxes, and company minimum rate of return are considered in this "present value" evaluation of transformer losses and in rate-of-return comparisons of competing transformers.