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Renting vs Buying An Industrial Generator

Evaluating Generator Rental and Purchase Options

Many factors are in the equation when acquiring a commercial or industrial power generator. Once the sizing and style of the generator are determined, the next step is often deciding if a rental or purchase is the best option. This article provides an overview of factors to consider when renting vs. purchasing a generator and includes some of the pros and cons most businesses and organizations have to consider when making this decision. Since Diesel Service & Supply buys, sells and rents generators, this is a common but relatively complex question our staff helps many customers wade through.

Advantages of Renting a GeneratorPortable Rental Generators

The most obvious benefit of renting a generator is that renting requires a fraction of the start-up cost when compared to a purchase. Some additional rental benefits are:
 
  • Lower Initial Cost than Buying - for limited budgets this is often a key driver in the equation.
  • Available on Short Notice - most outages are not planned, and rental units are ready to go on very short notice in many areas of the U.S. & Canada.
  • No Maintenance & Limited Downtime Risk- Rental units are maintained throughout the course of the rental. If the generator experiences a problem, service technicians are available from your rental provider to repair and/or replace the unit. For high availability continuous operations like mines and oil wells, this can be critical in reducing exposure to downtime.
  • Generator Size Flexibility - Ability to return a generator sized for a particular job and select another appropriate generator for the next project.
  • Generator Configuration Options - Most rental generators are setup to provide many different configuration options like voltage selector switches, numerous connection options, advanced control panels, and are generally easier to modify on the fly in many cases.
  • No Installation Costs - most rentals are portable generator sets optimized for easy connection, they also enjoy minimal to no site planning/preperation and various electrical code requirements that come with many permanent installations.
  • Rent to Own Options - Affords the customer the ability to purchase a leased generator at the end of the rental period.
  • Time of Use - Only rent the generator as needed, for things like concerts and events this is ideal, and also common in short-term construction projects.
It is often a good idea to begin by calculating the rental cost against the purchase cost. When the cost of the generator rental approaches the purchase cost, a rental could be eliminated in favor of a purchase. However, factors in the above list can add to the deliberation and further complicate the issue.

For example, long-term rentals are common in the construction industry. Many times, new construction does not have utility power for a set amount of time. Road construction projects often require portable generators to move from one location to another within a project area. Hospitals and health care facilities that must have a constant, dependable power supply also have a need for temporary power. When an installed emergency generator is removed from automatic operation status, a sufficient power supply must be connected in its place. The generator supplying temporary power should be the same size as the primary generator.  

Advantages of Purchasing a Generator

Permanently Installed Generator
Long-term use is a primary reason for purchasing a generator set. Selecting the proper size and generator rating is imperative when designing the power generation system. A rule of thumb for ratings is:
 
  • Emergency/Standby - Used when utility power fails
  • Prime - Used approximately 8 hours per day
  • Continuous - Continuous operation. Shut down for maintenance
Establishing the properly rated generator for the application is an important part of the advantage's equation. If an improperly sized or rated generator is installed, the system may not perform to expectations, experience greater failure rate, or both.

Once the correct generator is selected and installed some key advantages of purchasing are:
 
  • Asset Ownership - You own the equipment and are not locked into rental agreements, set time periods, and can also resell it if desired.
  • Savings vs. Long Term Rental Costs - When renting a large commercial generator over many months the cost can escalate fast. This is where it is helpful to look at all the possible scenarios and do the math on how much it costs for extended rentals with monthly breakdowns, and also consider what happens if you need the generator for longer than initially planned (which is quite common).
  • You Control Power Availability - Emergency, prime, or continuous power in a permanent installation is not controlled by a rental contract. Your facility is also never limited in the event that local rental generaors may not be available during peak rental times (like hurricanes and major power outages).
  • No Ongoing Maintaince Fees from Rental Providers - If you are a heavy user and rack up the hours on a rental generator you will most likely be required to pay for all additional service provided to maintain the generator at set hour intervals  (such as load bank tests and service), which adds to the cost of renting.
  • Internal Staff Maintenance and Repair Options - Facilities with a maintenance staff can elect to perform their own maintenance and repairs saving some cost.  More advanced testing, such as load bank testing is still usually contracted out with a local service provider
  • Configuration Modifications - Every generator installation is different from the last, permanent installations require individual configurations that rental units often do not offer including things like ability to customize wiring, fabricate custom ad-ons, modify enclosures, and customizing exhaust systems and fuel tanks just to name a few.
  • External Vendor Maintenance and Repair - For facilities with limited or no maintenance personnel, most any qualified local generator service provider can be used.
Generators can be purchased with a wide range of options including portable, those in sound attenuate enclosures, and those installed in a facility. All generators are complete power generating units including an engine, cooling system, and generator end. Portable and sound attenuated units have fuel, intake air, and exhaust in the unit and only need to be connected to load. Indoor generators must have intake, exhaust, and fuel connections completed in addition to electrical grid connections. Visit our In-Stock Generators to see our complete inventory.

Transportation and ServicesCrane and Shipping Services

After the generator has been purchased or a rental agreement is signed, the remaining items are transported to the site for installation and connection. Smaller portable units can be easily moved to jobsites with a truck equipped with a ball & hitch or ring & pintle hitch. Semi-trucks equipped with 5th-wheel connections transport larger units.

The two basic styles of permanent generators installations are sound attenuated enclosures and skid mounted. Both styles can require special loading and shipping steps. We have approved vendors for crane and transportation services. We can help arrange loading at the pick-up location, transportation, and unloading at the drop-off location throughout the US and Canada.

Selecting a Generator Supplier

Selecting a generator supplier who can help meet your needs is one of the next primary steps to make in the decision process. The company should have some key attributes such as:
 
  • Time in Business - How long the company has been in business and what are the customer ratings?
  • Size of Stock - Does the company have a sufficient stock to supply the selected generator with a short turn-around time or is there a waiting period for the generator?
  • Transportation - Does the company have selected transportation and crane service vendors?
  • Service - Can the company supply rental, maintenance, and troubleshooting and repair services?
To summarize, a great deal of thought often goes into making this key decision on renting vs purchasing a generator. Diesel Service and Supply has 35 years in power generation sales, rentals, and service and can help make this process easier, call 800-853-2073 to talk to a representative or contact us online today.

 
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