UPS as a Service UPSaaS

UPS-as-a-Service is a new concept that allows IT and datacenter managers to solve budget constraints. Using a“pay-per-use”model, critical loads benefit from a conditioned and uninterruptible power supply but only pay for the kWh used. “Today businesses spend between 70% and 80% of their annual IT budgets on items that just keep their systems running”, says a study from IDC. While Software-as-a-Service is well established in the data & IT market, major players are driving the demand for the “everything-as-a-service“ trend.

Added Value beyond features

The buying process of UPS systems focuses mainly on costs and technical product features like efficiency, technology, footprint etc. but a “pay-per-use “solution provides more financial advantages. The 5 main advantages of the UPS-as-a-Service concept include:

  1. No Investment, releasing budget and eliminating finance costs
  2. No ownership: you pay-per-kWh consumed using an all-inclusive monthly budget
  3. Support load growth: the solution is flexible and can be adapted to load growth and even additional levels of redundancy
  4. Monthly billing: based on a fixed price per kWh you receive a monthly invoice of consumed conditioned power. The consumption report is easily accessible via a web portal
  5. Accounting benefits: Expenses become operational costs and move from CAPEX to OPEX and will become beneficial even with the new accounting standard IFRS-16 effective January 2019  

Financial efficiency of 109%

Comparing the total costs after 7 years, purchasing a UPS, services and replacement batteries is 9% more expensive than UPSaaS™. UPS-as-a-Service is absolutely transparent in terms of monthly expenditures giving the user more freedom to plan ahead and leverage their IT budget for investment in more productive and revenue generating hardware like new servers and more storage space.  

An ‘all-inclusive’ Service

UPS-as-a-Service is unlike any other financial concept on the market. UPSaaS™ includes the entire UPS system (included N+X redundancy), cabling and distribution as well as a full service contract providing maintenance, installation, (de-) commissioning and spare parts. It even includes battery replacements during the contract period. The customer only receives a monthly bill depending on the consumption of conditioned power on a fixed price per kWh. Servicing and monitoring is completely outsourced to AEG Power Solutions. The end-user outsources everything and does not need to allocate and train staff.  

New Accounting Standards offer additional balance sheet benefits

The new accounting standard IFRS-16 has been introduced to a provide more accurate and transparent overview of the value of a legal entity or corporation. Effective as of January 2019, all leases will be treated as finance leases and asset purchase financing will be treated as a direct purchase and counted as CAPEX (Capital Expenditure). However all products used under an UPSaaS™ contract will be considered as Service and will therefore be treated as OPEX (Operational Expenditure).

How does it work?

The complete range of AEG Power Solutions three phase UPS systems, including the latest M600 modular and S500 monoblock ranges can be used for an UPSaaS™ contract. On the finance side, AEG Power Solutions is partnering with Burland Energy SA, an established provider of ‘as-a-Service’ concepts in the datacenter world.   The UPSaaS™ contract is managed by Burland Energy who are responsible for its management, monitoring and billing. AEG Power Solutions provides all the hardware components and services during the contract period. The contract process stages include:  

1. Send a UPSaaS™ request form

  • The end-user calculates how many kWh of power is needed and agrees an uninterruptible power solution for the project with AEG Power Solutions.
  • Burland Energy calculates a charge per kWh based upon the equipment and services required for the project.
  • The end-user receives a binding quote from Burland Energy via AEG Power Solutions.     

2.  The UPS System is installed

  • AEG Power Solutions installs all the equipment and provides ongoing maintenance and service throughout the life of the contract.  

3. Billing

  • Burland Energy sends a monthly consumption report along with a related invoice  
  • The end-user books all invoiced costs and fees as operational expenditure

4.  End of contract    

  • Anytime after the agreed contract kWh are consumed
  • Decommissioning of the UPS system after the contract ends  

All equipment is owned by Burland Energy and customers only pay for the energy they consume. The fixed kWh price is all inclusive and the contract contains the total amount of kWh. The monthly invoice is based on the actual consumption. Customer access to the equipment is limited to a “kill switch” (EPO). Burland Energy retains ownership of the assets at all time. There is a minimum consumption stipulated as part of the contract and once this has been exceeded the user can choose to either continue with the service or return the equipment. However, purchasing of the UPS system asset is not an option.  

UPSaaS™ provides IT and datacenter managers with a new way to purchase conditioned power for their sites in an all-inclusive “pay-per-use” model. With monthly billing the end-user can monitor their actual kWh consumption and know that they have a fully-maintained UPS system from AEG Power Solutions with no hidden costs.