How much will I save by changing to a closed-loop system?

Water is one of the most precious resources on the planet, yet it is often overlooked in industrial and laboratory cooling applications. While tap water may seem like an inexpensive and convenient option for cooing, it carries hidden costs – both financial and environmental. Even if a business isn’t directly paying for its water usage, excessive consumption places unnecessary strain on local water supplied and infrastructure. As water conservation becomes an increasingly critical issue, industries must rethink how they use water, particularly in cooling processes.

A closed cooling system, such as a chiller or an airblast cooler, provides a more efficient, sustainable, and cost-effective alternative to once-through tap water cooling. These systems recycle heat transfer fluids in a closed loop, reducing water waste, lowering operating costs, and preventing long-term damage to equipment. But how much could a business actually save by making the switch?

By working through a structured calculation, businesses can determine not only the annual cost of tap water cooling but also the break-even point where investing in a closed system becomes the more economical choice. Below, we outline the key calculations involved and provide a detailed worked example to illustrate the real savings potential.

Step 1: Calculating the Annual Water Cost for Tap Water Cooling

To determine the total cost of using tap water, the following factors need to be considered:

1. Operational time data you’ll need for this calculation:
Hour of operation per day (e.g., 8 hours)
Days of operation per week (e.g., 5 days)
Weeks of operation per year (e.g., 50 weeks)

2.  Total Run Time Per Year:
Hours per day x Days per week x Weeks per year = Total Annual Running Hours

3. Water Consumption Information:
Flow rate of tap water (litres per hour)
Total annual water usage = flow rate x total annual running hours

4. Water Cost Calculation:
Find out your cost of water per 1000 litres (including supply and sewerage charges)
Annual water cost = total annual water usage / 1000 x cost per 1000 litres

Step 2: Calculating the Operating Cost of a Closed Cooling System

A closed system, like a chiller or airblast cooler, has running costs primarily associated with electricity consumption. To calculate this:

1. Power consumption factors you’ll need to know:
Voltage of Supply (e.g., 400V)
Phase of supply (single-phase or three-phase)
Current drawn at peak load (in Amps)

2. How to Calculate Power Required per Hour:
Voltage of Supply x Current Drawn at Peak Load ÷ 1000

3. How to Calculate Annual Electricity Cost:
Find out your electricity cost per kW/hr
Annual Electricity Cost = Power per Hour x Total Annual Running Hours x Electricity Cost per kW/hr

4. Total Cost of Ownership
Purchase price of the chiller or airblast cooler
Annualised cost (e.g. spread over 5-10 years)

Step 3: Determining Payback Period

One of the most compelling reasons to switch to a closed system is its ability to pay for itself through reduced water consumption. To calculate the payback period:

1. Annual Savings:
Annual tap water cost – Annual electricity cost of the system

2. Payback Period Calculation:
Purchase price of the chiller ÷ Annual savings
This result gives the number of years or weeks required for the savings to cover the initial investment

Worked Example: G01

To illustrate the cost implications of using tap water for cooling versus investing in a closed system like the G01, let’s work through a detailed example using average UK business costs for 2025.

Step 1: Calculating the Annual Water Cost for Tap Water Cooling

1. Operational Time Data:
Hours of operation per day: 8 hours
Days of operation per week: 5 days
Weeks of operation per year: 50 weeks

2. Total Run Time per Year:
8hours/day x 5 days/week x 50 weeks/year = 2000 hours/year

3. Water Consumption Information:
Flow rate of tap water: Assume 10 litres per minute
Total annual water usage: 10 litres/min x 60 min/hour x 2000 hours/year – 1,200,000 litres/year

4. Water Cost Calculation:
Cost of water per 1000 litres: The average combined water and sewerage cost for UK businesses in 2025 is approximately £3.50 per cubic meter (1,000 litres)
Annual water cost: 1,200,000 litres/year ÷ 1000 x £3.50 = £4,200

Step 2 Calculating the Operating Cost of the G01

1. Power Consumption Factors
Voltage of Supply: 230V
Phase of Supply: Single-phase
Current Drawn at Peak Load: 5

2. Power Required per Hour:
230V x 5A ÷ 1000 = 1.15kWh

3. Calculating Annual Electricity Cost:
Total Annual Running Hours: 2,000 hours (as previously calculated)
Total Annual Energy Usage: 1.15kWh x 2000 hours = 2300kW
Electricity Cost per kWh: Approximately £0.2703 per kWh
Annual Electricity Cost: 2300kW x £0.2703 per kWh = £621.69

4. Total Cost of Ownership:
Purchase Price of the Chiller: Assume £5000 (this is an estimate; actual prices may vary depending upon specification)
Annual Operating Cost: £621.69
Total First-Year Cost: £5000 + £621.69 = £5621.69

Step 3: Determining the Payback Period

1. Annual Savings:
Savings from reduced water usage: £4200 (annual water cost)
Minus Additional Electricity cost: £621.69
Net Annual Savings: £4200 – £621.69 = £3578.31

2. Payback Period Calculation:
Initial Investment: £5000
Annual Savings: £3578.31
Payback Period: £5000 ÷ £3578.31 x 52 = 72.66 weeks

Findings

By replacing a tap water cooling system with the G01, a business could recoup its investment in approximately 73 weeks (just over 1 year and 5 months).

Beyond this payback period, the company would continue to save nearly £3,600 annually, while also reducing water waste, improving sustainability efforts, and protecting equipment from mineral build-up and contamination.

Even if a business doesn’t directly pay for its water, excessive use strains local water supplied, increasing the likelihood of future regulatory restrictions or price hikes. A closed system not only saves money but also future proofs cooling processes against rising costs and environmental concerns.

By using real-world data, this framework can be tailored to suit different facilities and operational conditions, helping businesses to make the best cooling decisions for their needs.

Need Help Choosing the Right Cooling System?

At Applied Thermal Control, we specialise in high-performance process cooling solutions designed for efficiency, reliability, and long-term costs savings.

If you’re considering switching from tap water cooling to a closed system lime a chiller or airblast cooler, our expert team can help you find the best solution for your specific application.

Contact us today to discuss your cooling needs and discover how ATC can help you to reduce costs, improve efficiency, and enhance sustainability.