Turbine System Economics and Reliability Availability Maintainability

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5.0
Turbine System Economics
and Reliability, Availability
& Maintainability (RAM)
Bonnie Marini, Ph.D.
Manager, Gas Turbine Design
Gas Turbine Engineering
Siemens Power Generation
Orlando, FL
phone: 407 736-6428
email: bonnie.marini@siemens.com
445 445
5.0-1 Introduction
With the varied and fast changing global power market, the complexity of
turbine system economics has increased dramatically. In the past, power plants were
primarily government regulated and base loaded. Dispatch and electricity pricing
was relatively predictable. In today’s market, with IPPs, there are endless variations
in the way power is produced, provided, regulated, and purchased. OEMs and power
producers need to understand methods to quantify and compare parameters, and to
understand the drivers and uncertainties to properly evaluate decisions and their
potential for profi tability in this constantly changing marketplace.
5.0-2 The Power Market Drivers
To understand the power market, one must keep in mind the key differences
between this market and others:
Electric power can not be economically stored.
Unlike other commodities, electric power cannot be easily or economically
stored. For the most part, it must be produced on demand. While there are some
efforts to retain energy generated during off peak hours using technologies such as
pumped storage, fl ywheels, and/or superconductors, the cost is high and the effi ciency
and reliability of these methods is low.
The demand for electric power is constantly fl uctuating.
The fl uctuating demand for electric power is clear. Demand varies during
the day, with a morning and evening peak and varies over the year with a winter
and summer peak. Some of this fl uctuation can be predicted based on historical
information, such as the typical change in consumption over a day, and the typical
seasonal variations, but the fl uctuations can shift signifi cantly from the norm due to
uncontrollable events like periods of severe weather.
Utilities have a high capital investment cost.
The initial required investment for a power plant varies based on the type of
power plant. Typically, utilities have very high fi xed costs, spending almost fi ve times
the initial investment per dollar than other manufacturing endeavors1. These fi xed
costs, which are typically between $475/kW and $1430/kW2, include equipment for
generation, transmission, distribution, and permitting.
Power plants have a relatively long life cycle.
Power plants do require signifi cant initial investment, but they compensate
with very long life. Power plants operate for decades, with units operating 30 years
or more.
Fuel prices are subject to negotiation and electricity prices are constantly varying.
These factors impact the ability to compete effectively in the deregulated
market.
There is an unfl inching expectation that required electric power is always and
immediately available.
Electricity has become a critical and integral part of the economy and there
is no tolerance for an inadequate supply no matter what the circumstances. This is
refl ected in the fact that electric consumption is generally accepted as one of the lead
economic indicators.