The Newark Star Ledger reported (here) that Public Service Electric and Gas, PSE&G is installing a the UMDNJ is installing a 2,700-ton chiller as part of an $11.4 million investment in negawatts. The Star Ledger reported that UMDNJ will save $1.3 million per year on energy costs.What’s the payback? An $11.4 million investment will save $1.3 million per year. That means the system will pay for itself in about 8 years 9 months, assuming the price of energy remains constant. I think it’s a much more reasonable to assume that the price of energy will go up.
The system will work long after it is paid for. It will save at least $13 Million over the next 10 years and $26 Million over the next 20 years – assuming electricity costs are constant, assuming electricity costs are constant. Assuming electricity costs increase an average of 5% per year, this will save $16.35 Million over the next 10 years, and $42.99 over the next 20 years.
- Projected Savings of $11.4 Million investment.
- After 1 Year: $1.3 Million. 11.4%
- After 5 Years: $7.18 Million (63%) with a 5% annual increases in cost of energy.
- After 10 Years: $16.35 M (143.4%).
- After 15 Years: $28.05 M (246%)
- After 20 Years: $42.99 M (377%).
We have Governor Corzine to thank. as well as Governors Whitman, McGreevey, Codey, and Christie.