Power Distribution in India is facing severe challenges. Predominant among them are high network failure rates, technical losses, PQ issues, customer dissatisfaction and high costs for asset upgrade & maintenance. Distribution Transformer (DT) is a key asset of the distribution network. Among the installed 4 Million DTs in India (as per CEA statistics) 6-8 lakhs DTs fail every year resulting in high financial losses. The losses in DTs can be primarily attributed to the following reasons:
- The DTs are very old and have exceeded their operational life but are still being used
- Operations and Maintenance (O&M) of the DTs and other network assets is not followed as a rigorous and robust practice
- Utilities, especially Public Discoms and Franchisees, have limited budget for network upgradation and maintenance
- Losses due to poor standard of equipment.
Further, technical losses in DTs occur because of the physical nature of the equipment and infrastructure of the power systems, i.e., I2R or copper loss – in the conductor cables, transformers, switches, etc. High Technical Losses (No Load & Load losses) persist in DTs of all major utilities across India – and their losses are very high when compared to the ideal losses for the same capacity.
DT Loss reduction through ‘active’ repairs
What is active repair?
Currently the most prevalent form of maintenance that takes place in Indian utilities is a breakdown repair during a fault occurrence. Across all major distribution utilities including private players, DTs are repaired when they fail or get damaged.
However, considering the high technical losses on DTs, which are much greater than the ideal loss levels, DT repairs happening only at the time of breakdown/failure results in huge loss of energy.
Active repairs is a method through which DTs can be repaired even before a breakdown/ failure incidence occurs, to significantly bring down the high technical losses (No Load and Load) to near ideal levels.
Active repairs involve augmentation or replacement of the active materials in a DT – Core and Winding, depending on the condition and design of the DT.
Depending on the No Load and Full Load losses, DTs can be categorised under 6 permutations and combinations, which drives the 3 types of active repairs.
6 DT categories are derived using Lower Threshold (P1) of 20% and Upper Threshold (P2) of 40%, for both No Load and Full Load loss levels (i.e., the existing loss levels compared to P1 and P2 above the Ideal loss levels), which have been arrived at in consultation with various DT experts and manufacturers.
Against each case, an action has been mapped from 5 unique actions. For Case 1, where the No Load and Full Load losses are both within 20% of Ideal loss levels, any active repairs, though can help reduce the technical losses further, are generally not economically viable.
For case 6, where both No Load and Full Load losses exceed 40% than the Ideal loss levels, any attempt to bring down these technical losses through active repairs may not be effective. In such cases, entire DT replacement may be the only viable option.
For any of the technical losses (No Load or Full Load) ranging in the 20% to 40% bracket from Ideal loss levels (Case 2 to 5), above mentioned active repair type and corresponding action can help bring down the respective technical losses to near Ideal loss levels.
Though DT technical loss reduction can also be achieved through replacement of the DTs altogether, the cost of new DTs do not justify the savings from loss reduction.
Especially in the scenario where utilities generally have limited CAPEX and other operational budget, benefits from technical loss reduction through active repairs of DTs outweigh its cost many times over.
Types of active repairs
Aside from normal maintenance activities, the following two types of active repairs can be useful for upgrading transformers:
- Core Augmentation
- Winding Augmentation/ Replacement
Core or Winding augmentation is an approach to increase a transformer’s useful life. At the same time, it also improves its no load and load loss characteristics. Augmenting a transformer means upgrading the transformer by adding more cooling methods to fulfill the growing energy requirements. DTs can be modified to take increased load potential by maximising the efficiency at which excess heat is dissipated from the main core and windings.
Upgrading a transformer instead of purchasing a new unit is more cost effective, it minimises disruptions to site operations and increases expected useful working life as well.
Business case for active repair
As per our study of one power distribution utility in India, which has over 4.5 lakhs consumer connections, 2,800 DTs across various capacities from 10kVA to 630kVA, aged from very recent procurements to as old as 1927. Most of the DTs are of 200kVA followed up 315kVA and 100kVA capacities.
Based on No Load and Full Load loss data availability of good set of DTs (some around 10% DTs) and other key parameters like downtime losses, loading of DTs and power purchase cost growth rate it is observed that existing technical losses of DTs is very high when compared to the Ideal loses for the same capacity. For 200KVA capacity DTs, which forms 50% of total DTs, the difference in total Technical losses from ideal values is more than 0.6 units per hour per DT. For some other capacities, the losses are as high as 1.63 units per hour. This results in staggering INR 21.12 Cr technical loss on DTs every year for the utility, despite being one of good managed and lower AT&C loss utilities.
If active repairs on DTs are done for this utility based on the guidelines mentioned in Section 2.1, Gross opportunity (savings from technical loss reduction) for the utility comes to INR 91.5 Cr, in a period of 10 years.
Against these, the cost of Active repairs (including cost of one-time Health Diagnostics, regular preventive maintenance, periodic oil change and filtering, future breakdown repairs, installation and transportation of DTs etc.) is estimated to approx. INR 21.1 Cr, which results in a Net savings opportunity of INR 70.4 Cr.
Even after considering a Finance cost of INR 7.96 Cr to fund the active repairs, the Net additional profitability is INR 62.5 Cr for the utility, with a ROI of 150% and Payback period of 2.74 Years.
This case is however still limited considering the 10 years timeframe considered for the utility. For other utilities with continued business perpetuity, like the state Discoms, the business case can be much bigger and much more attractive. The financing for such Energy Efficiency intervention can likely come through some form of programmatic financing.
Need for integrated player in DT management
Given the scenario, it is likely that a third party with capabilities in transformer maintenance and repairs, energy management and finance could play a significant role in the management of DTs going forward. This could be a Managed Service Provider (or MSP) who is a dedicated third party company (it can be a DT manufacturer or service provider), procuring and managing Distribution Transformers for a utility based on agreed Service Level Agreements (SLAs). This MSP can help restore the technical losses to near Ideal levels and add huge value in terms of loss reduction savings and manage DT assets with best practices.
Benefits
- Single agency ownership across life cycle of DT Management (from Procurement, O&M, Repairs, Scrapping etc.)
- Defined and agreed upon SLAs, and payments tied to performance of MSP. Some key parameters and its commitment by MSP are mentioned below:
- To maintain technical losses for all DTs within maximum 10% of ideal loss levels
- To ensure timely replacement / repair happens from inventory in case of any failure/breakdown
- Reduction in DT Failure/Breakdown Rate
- Regular maintenance
- Detailed reporting of DTs maintained, DTs repaired, etc.
- Reduce and maintain no load and load losses for all DTs within maximum 10% of Ideal loss levels
- To ensure a minimum DT failure/breakdown rate (for e.g., within 2% in our business case with a utility)
- Regular maintenance, oil change and timely repairs
- Additionally, MSP could also support functional uptime of other assets tied to DT like Energy Meters, Capacitor Banking etc.
Detailed reporting of DTs maintained, DTs repaired, etc. by MSP.
Credits: International Copper Association India (ICAI)
