KAESER Know How blog post: The benefits of compressed air contracting
KAESER Know How Blog

In this blog post we discuss what compressed air contracting is and the benefits you could realise by selecting this option - especially in the current climate where many CapEx budgets are constrained thanks to COVID-19.

Compressed air contracting
KAESER Know How Blog

In this blog post we discuss what compressed air contracting is and the benefits you could realise by selecting this option.

Compressed air contracting
Compressed air contracting

The benefits of just buying the compressed air you need

October 2020

The current pandemic may well have derailed your capital expenditure plans this year - even though your requirements may not have changed. If that’s the case, how can you achieve the same compressed air system upgrades you need without the initial capital expenditure outlay? Compressed air contracting - or just buying the actual compressed air you need - may well deliver the answer. In this blog post we discuss what compressed air contracting is and the benefits you could realise by selecting this option.

There are other ways to bring the compressed air you require into your operations besides the simple purchase of a compressed air system. Especially in the current economic climate, it may be well worthwhile to look into contracting options rather than acquiring your own equipment. 

As an essential utility, like electricity, gas and water, it is possible to simply just pay for the compressed air you actually use. Compressed air contracting offers many benefits compared to the conventional approach of compressed air system operation. The user immediately reaps the benefits of a cost-effective and energy efficient compressed air supply without having to make the initial investment. 

The contracting partner handles the planning, installation and operation of the system, based on the needs and specifications of the system operator. In this way the user avoids having to invest in a compressed air station, is saved the working hours and expense of servicing and maintaining the equipment, and converts fixed costs into immediately deductible variable operating costs by purchasing only the compressed air at a contractually agreed fixed price per cubic metre. 

Operation and servicing of the compressed air supply by the system provider ensures energy-efficient and reliable operation, as the provider also has an interest in adapting the station to changing operating conditions and to reflect state-of-the-art technology. 

There are also benefits when it comes to maintenance. For example, Sigma Air Utility from Kaeser is linked via Teleservice to the Kaeser Service Centre: this ensures maximum compressed air efficiency and availability at all times through the latest energy-saving technology, cost-effective remote diagnostics and preventive maintenance. 

When an end users opts to purchase only the compressed air in the required volume and quality instead of buying a compressed air station, they benefit from greater cost transparency in their operations: instead of mixed costing, plant owners have a reliable basis for budgeting in the form of a fixed price per cubic metre of compressed air pre-agreed in a long-term contract. The basic price for the entire contract period covers equipment and running costs as well as a baseline quantity of compressed air. For compressed air deliveries over and above that quantity, the unit price is also contractually agreed. Exact measurements guarantee that the customer is billed only for the volume of air actually drawn from the network. 

Contracting is a particularly attractive compressed air supply option for customers looking for immediate energy efficiency improvements. For example, if top management imposes a short amortisation period of, let’s say, two years, the number of possible energy saving measures is severely limited, which effectively excludes the potential for modernisation. Outsourcing presents an elegant solution in such cases. 

The potential savings achieved through compressed air contracting vary. When a company makes the switch, the contracting partner generally installs an entirely new compressed air system to ensure full utilisation of the entire energy saving potential. The actual reduction in compressed air costs will depend on the system being replaced. However, savings of up to 30 percent are not uncommon. This also applies over the long term, because the contracting partner, who is selling the compressed air at a fixed price, has the biggest incentive to operate the equipment as efficiently and economically as possible. The partner will therefore use state-of-the-art technology at all times. This includes both energy-optimised, high-efficiency compressors and intelligent compressed air management systems. Thanks to efficient pressure band control, this technology makes it possible to reduce maximum system pressure and, as a result, to lower energy consumption drastically.

Sigma Air Utility

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Learn more about Sigma Air Utility - the compressed air contracting model from Kaeser Compressors today. Just phone 1800 640 611 or fill in our form below and we’ll get back to you.

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