Buying a generator is a bit like buying a car–once you’ve bought it, you still have to pay for gas, inspections, maintenance, wiper blades every now and then…In other words, how often you use it and how hard you push it will determine what you can expect to spend on it while you own it, and this can vary widely from one person to the next.
Unlike their gasoline- or diesel-powered counterparts, generators that run strictly on natural gas don’t come in small, portable models. If you’re looking for natural gas power generation, you’re looking at either a standby generator as a backup to your utility electricity, or a prime or continuous power generator that provides power in lieu of a public utility. The former may be for either residential or commercial purposes, while the latter is usually commercial.
Let’s take a look at these two main options and see what consumers can expect to spend over the course of the generator’s lifetime in four main categories.
Generator Purchase Price
Unsurprisingly, the best way to get a feel for natural gas generator prices (and find the best deal) is to shop around. Once you do you’ll find the sticker price of whole-house generators typically ranges from $2,500-$6,000 (before tax) and are commonly sized between 6kW and 20kW. Twenty kW is large enough to power virtually everything in a home of up to 5,000 square feet.
With portable, residential generators, it is possible to save a couple hundred dollars by using a manual transfer switch rather than an automatic switch (all generators used to power home appliances or rated 5kW or above are required to have a transfer switch). But an automatic transfer switch (ATS) is highly recommended as it will automatically kick on your backup power without you having to manually flip the switch in bad weather or an emergency, and it doesn’t add that much to your final bill.
Natural gas generators for commercial and industrial applications start around where residential generators end, about 20kW, and can go as high as 4000kW. A generator that size weighs almost 30 tons, so obviously you’re looking at a hefty price tag, potentially as high as $2 million.
Luckily, only the biggest, most power-intensive enterprises will ever approach a need that big. A good rule of thumb in sizing the generator is 50 kW plus 10 watts per square foot. So a small retail shop might need 65kW, while a Kroger might need 1000kW. The former can be had for $30,000-$40,000 new, while the latter retails for anywhere from $100,000 to $500,000 or more.
It’s important to note that prime power generators will be more expensive than standby generators because they have to be able to run for much longer lengths of time and handle sustained heat generation without breaking down.
A shoddily installed generator is a dangerous hazard. Incorrect wiring can backfeed power into the grid and be fatal for linemen, firefighters, and anyone else working on the lines during an outage. So while you should get quotes from several installers before selecting one, it’s always recommended to let the professionals handle the installation.
According to HomeAdvisor, the average installation cost of a standby home generator is about $4,000, although the range of possibilities extends from several hundred dollars to over $9,000. Obviously, the more complicated a job is for the installer, the longer it will take them to complete, and the more they’re likely to charge. For example, a property where the electric meter is on one side of the house and the gas meter is on the opposite side creates more work for the installer.
These are some of the factors that play into stationary home generator installation costs, which may or may not be included in the total price (so be sure to check):
- Preparing the site and pouring the concrete pad: $50-$75 per square foot
- Connecting to existing utility lines: $50-$100 per hour
- Wiring to electrical panel and installing transfer switch: $65-$100 per hour
- City permits and inspections: $50-$200 each, typically one for plumbing and one for electrical
- Materials: $300-$2,000
Commercial generators are inherently more complicated than smaller residential models because they’re so much larger and retrofitting is often necessary in older buildings. Some dealers estimate $1,000/kW for buying, installing, and one year of maintenance for the generator; so a 65kW natural gas generator would cost $65,000 with installation.
Separating out purchase price from installation, small businesses can probably expect to pay between $3,000-$6,000 to set up the generator. Of course, what costs $6,000 in Alabama may cost $12,000 in Connecticut; that’s just the nature of the economy. So in places like New York City, for example, installation prices for apartment buildings can soar into the hundreds of thousands of dollars.
How much you spend on natural gas for your generator is a function of how many kW it is, what size loads you’re carrying, and how often you’re running it. Your generator’s spec sheet will tell you what kind of fuel usage to expect at ½ load and full load.
As an example, a 20kW Generac home standby generator uses 204 cubic feet of natural gas per hour at 50% load, and 301 cubic feet at full load. With natural gas averaging about $12.75 nationally for 1,000 cubic feet, that puts fuel expenses at $2.60/hour at half-load, and $3.83/hour for a full load. So a five-hour outage would cost about the price of a movie ticket to cover with generator power.
Of course, once you go up in size to commercial generators, fuel demands rise. A 60kW natural gas generator burns nearly 800 cubic feet at full load, and a 100kW unit burns more than 1300 cubic feet. Natural gas prices for commercial and industrial customers are significantly lower than residential gas, so business owners get some relief there, but it’s important to recognize how fuel consumption impacts the bottom line with large natural gas generators.
Natural Gas Resources
Certain preventative maintenance needs to be performed on your unit on at least a semi-annual, but preferably monthly basis. You probably know if you’re the type of person who’s comfortable performing this upkeep yourself. If you are, you can save hundreds of dollars over the generator’s lifetime…assuming you know what you’re doing.
You’ll be responsible for tasks like:
- Changing the oil and filter, including cold weather kit for cooler regions
- Inspecting (and replacing when necessary) belts, connections, clamps, and bolts
- Repairing coolant leaks
- Checking battery and alternator voltage and exerciser circuits
Generac and other brands offer maintenance kits and accessories for DIY-ers, and there are countless tutorials and resources on the web covering virtually every task you’ll come across as a generator owner.
If you’re not comfortable (or interested in) doing the upkeep on your generator, your dealer and/or installer likely offers maintenance plans of one to 10 years, with discounts for committing to longer terms. A home standby generator up to 20kW may cost around $300-$400 per year to service. Moving up into the commercial sizes, service plans can run from $500 per year to $2,000+. Especially if you’re using them for prime power, heavy-duty commercial generators that see dozens of hours of usage per week are best entrusted to professional maintenance personnel.