A building has a gymnasium with sixteen 500 Watt incandescent ceiling lights. An equivalent amount of light could be produced by sixteen 250 Watt PAR (parabolic aluminized reflector) ceiling lamps. The difference in price is $10.50 per lamp, with no difference in labor. The gymnasium is used 9 months each year. How many hours per week must the gymnasium be used in order to justify the cost difference of a 1-year payback? Assume that the following rate schedule is used, that gymnasium lights do contribute to the peak demand. Rate structure: (Minimum demand of 20 kW/month to qualify for rate) Energy cost = $0.04 per kWh Demand cost = $6.50 per kW per month Taxes = Total of 8%
A building has a gymnasium with sixteen 500 Watt incandescent ceiling lights. An equivalent amount of light could be produced by sixteen 250 Watt PAR (parabolic aluminized reflector) ceiling lamps. The difference in price is $10.50 per lamp, with no difference in labor. The gymnasium is used 9 months each year. How many hours per week must the gymnasium be used in order to justify the cost difference of a 1-year payback? Assume that the following rate schedule is used, that gymnasium lights do contribute to the peak demand. Rate structure: (Minimum demand of 20 kW/month to qualify for rate) Energy cost = $0.04 per kWh Demand cost = $6.50 per kW per month Taxes = Total of 8%
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A building has a gymnasium with sixteen 500 Watt incandescent ceiling lights. An equivalent amount of light could be produced by sixteen 250 Watt PAR (parabolic aluminized reflector) ceiling lamps. The difference in price is $10.50 per lamp, with no difference in labor. The gymnasium is used 9 months each year. How many hours per week must the gymnasium be used in order to justify the cost difference of a 1-year payback? Assume that the following rate schedule is used, that gymnasium lights do contribute to the peak demand.
Rate structure:
(Minimum demand of 20 kW/month to qualify for rate)
Energy cost = $0.04 per kWh
Demand cost = $6.50 per kW per month
Taxes = Total of 8%
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