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A rotary UPS uses the inertia of a high-mass spinning flywheel (flywheel energy storage) to provide short-term ride-through in the event of power loss. The flywheel also acts as a buffer against power spikes and sags, since such short-term power events are not able to appreciably affect the rotational speed of the high-mass flywheel. It is also one of the oldest designs, predating vacuum tubes and integrated circuits.

It can be considered to be on line since it spins continuously under normal conditions. However, unlike a battery-based UPS, flywheel-based UPS systems typically provide 10 to 20 seconds of protection before the flywheel has slowed and power output stops. It is traditionally used in conjunction with standby diesel generators, providing backup power only for the brief period of time the engine needs to start running and stabilize its output.

The rotary UPS is generally reserved for applications needing more than 10,000 watts of protection, to justify the expense and benefit from the advantages rotary UPS systems bring. A larger flywheel or multiple flywheels operating in parallel will increase the reserve running time or capacity.

Because the flywheels are a mechanical power source, it is not necessary to use an electric motor or generator as an intermediary between it and a diesel engine designed to provide emergency power. By using a transmission gearbox, the rotational inertia of the flywheel can be used to directly start up a diesel engine, and once running, the diesel engine can be used to directly spin the flywheel. Multiple flywheels can likewise be connected in parallel through mechanical countershafts, without the need for separate motors and generators for each flywheel.

They are normally designed to provide very high current output compared to a purely electronic UPS, and are better able to provide inrush current for inductive loads such as motor startup or compressor loads, as well as medical MRI and cath lab equipment. It is also able to tolerate short-circuit conditions up to 17 times larger than an electronic UPS, permitting one device to blow a fuse and fail while other devices still continue to be powered from the rotary UPS.

Its life cycle is usually far greater than a purely electronic UPS, up to 30 years or more. But they do require periodic downtime for mechanical maintenance, such as ball bearing replacement. In larger systems redundancy of the system ensures the availability of processes during this maintenance. Battery-based designs do not require downtime if the batteries can be hot-swapped, which is usually the case for larger units. Newer rotary UPS units use technologies such as magnetic bearings and air-evacuated enclosures to increase standby efficiency and reduce maintenance to very low levels.