This overview of ratemaking and rate-design principles should ease the myriad tasks awaiting new rate analysts and attorneys, while provoking nostalgia among industry veterans still manning the...
Rate Case Analytics
Hard numbers support operating- and capital-cost claims for gen plants.
and record generator outputs, heat rates, and controllable parameters. Plant operators use this real-time performance information to continuously optimize the heat rates of the AmerenUE fossil units by making operational adjustments.”
In yet another example, PM&D technology is mentioned in BC Hydro’s 2007 Annual Report , along with smart grid, smart metering technology, and spatial asset management, as examples of new technology initiatives to improve system performance. “The advanced equipment monitoring and diagnostic system tracks changes in equipment condition to help maintenance engineers at our generating facilities optimize and plan preventive maintenance.”
BC Hydro monitors 14 of its 30 hydroelectric facilities using predictive analytic technology, although those units cover more than 90 percent of the utility’s hydro capacity. Gas turbine and other hydro assets also will be added, according to Mr. David Lebeter, director of generation operations.
Many owners and operators with large and geographically dispersed generating assets deploy real-time heat rate and predictive analytic software through centralized maintenance and diagnostic centers. One leading predictive analytic software product now is being used to avoid failures and improve reliability at hundreds of power stations, either at individual plants or through a centralized M&D center. Such software implementations have been progressing over the last decade or more.
Beyond bolstering rate cases, owners and operators also are reporting performance improvements by deploying these technologies. Entergy, for example, avoided a catastrophic failure of a 411- MW steam turbine-generator at its gas-fired Waterford station. Analytics software began to show anomalies in the operating data and vibration specialists were dispatched to investigate, ultimately prompting a unit shutdown. Subsequent inspections revealed a 1.5-inch deep crack in a generator rotor shaft. While repair of the unit was estimated at around $5 million, Entergy estimated it would have incurred an over $30 million financial hit if the unit failed catastrophically, plus the potential for loss of life and limb. The Waterford units are 33 years old.
In addition to enabling plant owners and operators to optimize heat rates and use exorbitantly priced fuel as wisely as possible, these technologies can increase uptime by avoiding failures and converting unplanned equipment events into predictive maintenance activities, and generally raise capacity factors by reducing forced outages. From the perspective of utilities reporting to their commissions, they are relatively low-cost approaches to reigning in operating costs and supporting necessary capital expenditures.
The nation’s flagship fossil, hydro, and nuclear generating fleets continue to age, and the reality is that new replacement capacity isn’t coming to the rescue anytime soon. The earliest a nuclear unit could be on line by all accounts is 2017. Most coal-fired projects have been postponed, delayed, or bottled up over global warming issues, as three major Wall Street investment firms have issued their “carbon principles,” stating that they will not finance new coal until carbon capture and sequestration is commercially available. That’s not expected until 2020. Some gas-fired assets are getting permitted and built, but at today’s natural gas prices, they’ll face difficulty competing against the aging, but long since paid off, existing fleet.
Thus, the industry is working to