Many contractors worldwide have used temporary power, standby power, backup power, or whatever you like to call that equipment used to keep business and recreation going in places where the usual local power sources are unavailable or inadequate. Such names as Ingersoll-Rand, Deutz, John Deere, Atlas Copco, Baldor, Kohler, GE, MQ Power, Kawasaki, Caterpillar, Yamaha, Cummins, Mitsubishi, Honda, Daihatsu, and Magnum Products spring to mind, makers of engines, gensets, and compressors. Rental backup equipment is used temporarily. That could mean a few days, a week or two, a month, or even the multimonth life of the project. But so far, most people still perceive it as definitely temporary. That could change.

The blackout in mid-August in the Northeastern states and Canada shocked people into realizing, "Yes, it can happen here." It was an uncomfortable situation; it was temporary. Afterward it was a good (temporary) topic that people affected could talk about to their friends and relatives in other states. The event was also a most serious warning. "There's just not enough power available for our viewers," said television and radio correspondents, with knowing nods.

What Is Available? How Quickly Can You Get It?

How much power is available to rent? Will it be adequate for your building or factory? "Cat Rental Power and Caterpillar dealers operate the largest North American power rental fleet, with units from 20 kilowatts to over 5 megawatts, predominantly clean diesel with some gas-fueled units," notes Mike Wuebben, Caterpillar's rental power manager. "A full complement of cable, transformers, and fuel tanks are available, with a full scope of engineering, support, and installation services. We can also offer energy solutions for cooling and air compression." The supply of necessary accessories and engineering support is an important facet of the rental sector. Most managers who require immediate backup power know only what power they need and seldom exactly what that entails. One of the perceived advantages of renting standby power is that the equipment comes with everything necessary to make it run efficiently and in time to save the day.

Backup power is available for individual households, but most applications we investigated seemed more demanding than that. To counter that impression, Jim Rose, MQ Power's product development manager, says gensets in the small- to medium-size range seemed to be in greater demand now. "Due to changing and improving technologies, the load demands for today's generators have improved in recent years," explains Rose. "Ten years ago, a 20-horsepower motor might not have been available with a soft start control. This meant that the generator had to be sized [large] to start the motor. Today, with available solid state, soft start controls, the same motor might be started with a generator half the size. This makes the small-to-medium units more popular today than ever."

In this same area of backup power and revealing why there might be a trend to purchase beyond rental for small gensets, Larry McCormack, president of Colorado Standby LLC, notes, "The 6-kilowatt to 12-kilowatt units are growing very fast and have been for the last two years. The public is just now becoming aware of these systems, and thanks to high-volume low-margin companies like ourselves, [the systems] have become much more affordable than in the past. The Internet has played a huge role in that awareness." He adds that his company does not deal in the ultra-large units you see at hospitals or airports, but it is seeing an increase in the larger home standby units and the smaller commercial units of 20 to 45 kW.

At Baldor Electric Company, the largest increase observed in its generator business has been in the bigger gensets. "Both the rental and sales markets continue to show a strong growth in larger-kilowatt units," asserts Bill Lang, marketing manager for Baldor generators. What about the small-to-medium gensets? "This market is starting to see some activity again this year," adds Lang. "Baldor has been planning to capture more of this rental business with new products and marketing plans that will assist rental operators in rejuvenating their generator inventories."

Prime Energy is a division of Rental Service Corporation, part of the Atlas Copco Group, whose focus is on providing temporary power for a diversified customer base. "It is likely that just about any business segment you might ever think of will, at some point, need temporary power," states Richard House, sales manager for Prime Energy. "Our expertise ranges from the small, 100-kilowatt needs of a remote construction site just breaking ground to supplying backup power to an entire municipal utility district through a sophisticated network of synchronized equipment.

"Businesses needing temporary power typically fall into four categories," continues House. "The first is to supplement unscheduled power failures that usually require backup power as quickly as possible. The second is the contingency-plan scenario, whereby a business is preparing for the unscheduled need before it occurs. Planning like this is an insurance policy to prevent any major economic impacts to the business should power fail. Many businesses in areas like the Gulf Coast [of the] United States implement a ‘natural disaster or hurricane' contingency plan for the six-month hurricane season. In the event a hurricane should approach land, these businesses want to be assured that they have backup power at their disposal and are willing to pay equipment providers a monthly fee for this guarantee. The third category is for ‘peak shaving' and ‘load shedding,' whereby a business determines when the high-demand periods are for power in its area and provides temporary power during these periods. The fourth is a negotiated long-term rental to back up a manufacturing operation that would potentially experience a major economic impact should their power fail. For instance, Prime Energy supplied backup power to a West Coast DVD manufacturer using automatic transition switching to prevent any interruption in production should there be a power failure."

How quickly can standby power be available? During the August blackouts in the Northeast and Canada, Cat Rental Power and Caterpillar dealers began mobilizing trucks and establishing marshaling yards within 60 minutes of the occurrence. Nearly 500 MW of temporary power were delivered in support of hospitals, community services, industrial operations, and other local needs.

Is This Market Growing?
We asked professionals involved in energy use and distribution how they see the current (no pun intended) situation, and there were almost as many answers as speakers. There is significant agreement on some key issues. Gene Stone is president and chief sales engineer of All-World Diesel Generator Inc., headquartered in Idaho. "In many parts of the country, the potential electrical energy shortage problems have not surfaced enough yet to cause alarm," observes Stone. "Here in the Northwest, it is surprising the number of companies that do not have standby electrical power and don't seem to be too concerned. The East Coast has had to live with the prospect of hurricanes and storms, and standby power is quite common, but even in many parts of California we still find major companies that rely on power to keep their operations going, with no commitment to install standby power." Stone goes on to state that he believes it is an economic issue more than a practical or planning issue. Backup power costs money, and many companies choose other places to spend their money. "A majority of people just don't feel the problem is going to get serious enough to warrant the financial commitment," explains Stone. "'Let's just rent a generator if we need one!' That's my take on the market. Generator companies tend to live on emergencies, storms, hurricanes, other natural disasters and wars that take out the power." There is widespread agreement with these views.

Standby power (rented or under contract) has become a good option for many situations. Companies mentioned earlier have served the market well. Standby equipment has traditionally been considered temporary, but it might be permanent too. The permanence is not in the fact that it lasts forever but that it is always available, with not even an hour's delay for delivery. Recently Caterpillar supplied power equipment for a permanent/temporary situation. Five of its largest gas-fired engines supplied energy for a new electrical power plant in Geneva, IL, located 40 mi. west of Chicago. The $18 million project involves construction of a 29-MW power plant capable of providing critical peak power for up to 40,000 homes.

"We are finally starting to see renewed growth in the traditional rental market segment," says Lang of Baldor. "The market has been flat. The economy has been a major culprit, of course, and the age of the rental fleet. Our confidence is based on the fact that the pipeline of excess inventory from Y2K and the resultant slashing of prices seem to be over." Lang made another interesting statement that certainly bears repeating and remembering. "The majority of rental customers know and demand ‘rental grade' equipment because their livelihood depends on it. Even though it may be economically feasible to purchase a ‘low-cost' generator, the true rental customer knows this will not fulfill his job demands."

The Perception of Power
Most people can understand that the electricity will go off if a thunderstorm brings down the pole on the corner of Sherman and Main or a cottonwood crashes across the lines opposite the hospital. Many people do not understand that there is not a limitless supply of electricity. "Power is not a constant," explains Dan Thomsen, eastern region manager for the power generation business of Ingersoll-Rand. When too much power is used, the supply to a factory or a house can be shut down remotely (and not by the owner). Companies located in parts of the country where power outages are not unusual have begun to take steps to ensure that their business carries on even when all around is dark. Take a cold-storage company in Florida, for example. During the months of the hurricane season, there is a chance that power will be disrupted. That would be commercial disaster for a cold-storage company, so it arranges to have power available. It rents standby power for several months (in this case, the months of the hurricane season). Manufacturing companies and chemical plants make similar arrangements to use equipment from such companies as Ingersoll-Rand. "It's a matter of being ready," emphasizes Thomsen. "A city will install power as backup because there will be peaks in demand, requirements above what is routinely available." How big is this market for standby power? The official guess is that it exceeds $400 million now and could almost double in the next few years as people understand the advantages of having standby power immediately available.

"Many businesses are reevaluating their plans and procedures for business continuity in the event of a major power interruption," confirms Wuebben, Caterpillar rental power manager. "In some cases, they are establishing these plans for the first time. Planning for business continuity and finding a support network to rely upon are growing in importance, and businesses can benefit from assessing the financial and power-quality benefits offered by onsite and emergency standby generation."

What is the cost for a serious outage? New York City officials estimate that the economic cost of the August blackout will exceed $1 billion in their own city. That's only about one-fifth of the area involved. NYC Comptroller William Thompson explained that $800 million of economic activity did not happen, while some $250 million worth of perishable goods were lost. What does one day of lost business (or not having any of the daily paperwork of invoicing or purchasing done) cost your organization? Costs that might be ignored or forgotten include overtime for emergency services and lost tax revenue. Are those who cannot work because of loss of power paid for their time or do they receive mandatory (unpaid) vacation?

MQ Power supplies portable generators to the construction, rental, and entertainment industries. "The majority of standby generators are purchased rather than rented," says Rose for MQ Power. "There are several reasons for this. First, due to the complexity of determining and planning load circuits for an emergency power system, involvement of a qualified engineer is generally required. Second, in many jurisdictions, portable generators are allowed to remain on-site for only prescribed periods of time—12 months, for instance. Portable rental generators are usually connected to load panels with temporary, aboveground cabling. Standby generator installations use cabling that is typically underground. It makes a cleaner, safer installation that meets the National Electric Code requirements."

What Should You Expect in a Genset?
"A person looking to rent power equipment should make sure he or she is getting a quality rental-grade generator," advises Lang. "Quality is the key word. It is quality that will give you days or weeks of trouble-free operation. An indication of quality can come from the manufacturer's warranty. Baldor generators, for example, offer a three-year warranty. Ease of use is also of major importance in a rental generator." An interesting caution given is to ascertain the requirements for running 240V equipment. "With Baldor generators, it's plug and play," says Lang. "You can plug in both 120-volt and 240-volt equipment right up to the kilowatt limit of the generator, in any combination. Many generators have one or two pages of [complex] instructions on the use of the ‘full power switch.' If you don't have the loads set just right, you can damage the generator and the equipment. Look for automatic handling of this potential problem."

"The primary consideration in selecting a genset is whether or not it will meet all the operating requirements of the application," advises Rose. "That sounds easy, but often the renter is offered product because it is ‘on special' or ‘It's all I've got right now.' A renter needs to understand what the operating requirements really are. Besides sizing the genset properly, there are other important considerations, such as environmental concerns. Does the unit meet local requirements for engine emissions? Is the unit adequately equipped for sound silencing? Does it have the necessary plug-ins for running accessory equipment? Does the generator have adequate fuel capacity for the intended use? If the unit is trailer-mounted, what are the overall dimensions? Not all trailer-packaged generators are the same, and some sites have limited access or narrow gates to consider. I recommend that renters develop a checklist of these items and take the list with them when shopping for a rental generator. It will make the selection process much easier."

Making a list of your application needs is a good idea. McCormack of Colorado Standby offers a list too. He says the main features you should look for in an emergency generator system are dependability; quietness; clean, consistent power (in both voltage and frequency); a reasonable price (which is not the same as cheap) for a name-brand product; and consultation with an electrician for the proper sizing and installation quotes. "A couple of other points would be to never, ever back-feed your electrical system," adds McCormack. "It is illegal and very dangerous to the power company that is trying to restore your electricity. And choose a fuel type that is best suited to your area. Natural gas is not a good choice for California [because of earthquake potential], and LP [propane] is probably a much better fuel."

"There are usually two groups of companies that supply the temporary market," says House of Prime Energy. "The smaller rental businesses support the greater-than-100-kilowatt market with equipment typically rated for intermittent service, providing few of the accessories needed to support a total energy package. On the other hand, the major rental providers, capable of supporting everything from a major refining operation to supplementing power to a utility grid, must provide continuous-duty-cycle generators along with a host of sophisticated accessories and the technical know-how to engineer such a project. When selecting a supplier for a large, multimegawatt project, the consumer should look at the supplier's technical expertise just as critically as [he or she does] the equipment being supplied."

Contingency Rental Agreements
Everybody agrees that extended power outages from natural disasters, major utility equipment failures, vandalism, or even terrorism can have a tremendous negative financial impact on many types of businesses. Typical standby power systems—sized to power security, emergency lighting, and life-safety systems for short outages—generally are unable to power air conditioning, commercial bulk refrigeration, or industrial manufacturing processes needed to get through a longer outage.

An economical alternative to installing massive amounts of standby generation is to enter into a contingency-power rental agreement," says Ken Cannella of Cummins Power Rent, a division of Cummins Power Generation with more than 80 years of experience in increasing the availability and reliability of electric power around the world. The contingency-power rental agreement is a contract that ensures adequate rental power will be delivered within a certain window of time—typically from two to 48 hours, depending on the type of contract and other conditions. "Cummins Power Rent offers contingency agreements with national account customers who pay a fee to reserve a rental power unit," says Cannella. "The units can be parked at a Cummins distributor or at a customer location. It's a lot like buying power insurance—where Cummins guarantees that a certain number of generating units will be delivered to a location based on the time it takes to move them from the storage location to the point of use."

Another type of agreement involves a guaranteed first right of refusal. Under this contract, the rental units would be supplied from rotating stock generators and delivery may take up to 48 hours, depending on road conditions. In either type of agreement, a customer can be assured that adequate power will be available within hours to get a business up and running again.

PAUL HULL writes on construction and environmental topics for several international magazines.

DE - Nov/Dec 2003