Overhauling CCGTs under NETA, IRR Conference, London, 2001


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A paper that explained the implications of overhauling gas turbine-based power plants under the then new UK power trading arrangements.

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Overhauling CCGTs under NETA, IRR Conference, London, 2001

  1. 1. Overhauling CCGTs Under NETA Shaun West Technical Services Manager Innogy plc © Innogy 2001
  2. 2. Outline Commercial and technical considerations Timing Inspections and overhauls Return to service Decision making Planning for the unplanned Opportunity maintenance Competency and resource management Summary © Innogy 2001
  3. 3. Considerations © Innogy 2001
  4. 4. Considerations © Innogy 2001
  5. 5. Commercial Considerations Use forward gas and power curves to identify best outage period Consider optimising with other plant in portfolio to maximise gross margin Need to consider effect of plant outage overrun – risk of late return to service – risk of failure after return to service © Innogy 2001
  6. 6. Typical Forward Curves 24 30 29 23 28 G as Price (p/therm ) 27 21 26 20 25 24 19 23 18 22 17 21 20 16 Month Month Month Month Month Month Month Month Month Month Month Month Month 1 2 3 4 5 6 7 8 9 10 11 12 13 © Innogy 2001 Electricity Price (£/MW h) 22
  7. 7. Commercial Considerations Identification of optimum outage timing – period of low power price following predicted return to service date – period of high predicted gas price during outage This period could be during the winter as it is the difference between the two forward curves! © Innogy 2001
  8. 8. Optimising with a Portfolio Level of ‘spare’ capacity Risk (probability) of overrun Cost of holding back other plant in reserve Self-insure – without ‘self-insurance’ financial penalties maybe high Market instruments to cover risk? – few and often expensive (ACE and Innogy in UK) © Innogy 2001
  9. 9. Technical Considerations It is important not to replace components before life is consumed – need to consider repair/replace strategies Need to keep account of plant life usage – typically in terms of EOH – also condition based Leads to understanding ‘engineering deficit’ – how rapidly the plant wears out © Innogy 2001
  10. 10. Technical Considerations Timing – will overhaul teams be available? – will parts be at site? – spares? Schedules – is the interval between overhauls sufficient for refurbishment and procurement of long-lead items? © Innogy 2001
  11. 11. Outage Timing © Innogy 2001
  12. 12. Planning - the timing What do the forward curves look like? When will plant life (EOH) be consumed? – based on base-load and flexible operation What is the ‘risk’ of flexible operation? – sell gas, frequency response, etc What are the costs of running past the overhaul interval – will blades be fit for refurbishment? © Innogy 2001
  13. 13. Summer vs Winter Outages Innogy’s outage season starts in February and finishes in November Summer 2000 large availability payments Winters are now warmer and wetter - less power demand Gas prices now pegged to oil – high fuel costs in winter © Innogy 2001
  14. 14. Conclusions Use of forward curves for fuel and power suggests that we will move to 12 month outage season Better consumption of component life – leading to lower cost per EOH Risk - the UK will push F-class technologies harder than any other market in the world © Innogy 2001
  15. 15. Inspections and Overhauls © Innogy 2001
  16. 16. Planning the Outage It is vital that planning considers – scope – outage duration and outage period – staff resources – equipment © Innogy 2001
  17. 17. Scope of Overhaul What is a standard overhaul? – what is the value of extending the overhaul to do more work – value in the marginal cost increase Innogy no longer does ‘A’ inspections on 13E2 gas turbines Innogy carries out extended ‘B’ inspections on 13E2 within the standard period © Innogy 2001
  18. 18. Scope of Overhaul Innogy has undertaken – reduced scope ‘C’ inspections - following a ‘B’ inspection – standard scope ‘C’ inspections - due to need to generate – extended scope ‘C’ inspections - due to need to overhaul © Innogy 2001
  19. 19. Duration Scope of work defines the overhaul plan The plan identifies the critical path Optimising the critical path reduces the overhaul duration and overrun risks Validity of the plan is dependent on: – staff resources – equipment – lay-down area – documentation © Innogy 2001
  20. 20. Staffing Availability of: – overhaul teams (fitters, lagging, scaffolding, C&I, welders, etc) – own maintenance team – OEM or other competent engineers – re-commissioning engineers © Innogy 2001
  21. 21. Culture ‘One team - one goal’ culture for all involved – station staff, technical contract engineers, trade/craft contract staff H&S - paramount QA - good job first time Innovation - how can ‘we’ do it better next time? © Innogy 2001
  22. 22. Equipment Availability of equipment: – additional vane carriers or combustors – specialist tooling – up-ending facilities and transport – cranage – lay-down areas Must identify all critical items on the overhaul plan © Innogy 2001
  23. 23. Lay-down Plans © Innogy 2001
  24. 24. Documentation © Innogy 2001
  25. 25. Documentation © Innogy 2001
  26. 26. Return to Service © Innogy 2001
  27. 27. Rapid Return to Service? What value? – power contracts (generation) – gas arbitrage (sell gas on) – options (power/gas swaps) and services – market volatility More products to sell Value is greater the earlier the date is known © Innogy 2001
  28. 28. Rapid Return to Service? Drivers for shorter overhaul durations Overhaul period Overhaul duration Late shut down to take advantage of high power prices © Innogy 2001 Overhaul is completed but gas price is high and traded Plant returns to service when power price is high
  29. 29. Generation and Options Value of gas trade - 400p Value of option - 50p 25 Price £ 20 15 Option 10 5 0 0 1 2 3 4 Contract date © Innogy 2001 5 6 7
  30. 30. Rapid Return to Service Important to reduce overhaul duration OEM’s durations are not ambitious – different drivers and don’t understand the power market Profitability may be increased even though the outage costs more – 24/7 working – onsite machining ‘insurance’ © Innogy 2001
  31. 31. Returning to Service Re-commissioning is now key – don’t forget the C&I! Must minimise exposure to the balancing market – must not trip whilst on load – must come to load in a predicable manner Some benefits with aggregation © Innogy 2001
  32. 32. NETA - balancing market penalties Trip exposes operator to system buy price – typically £2-1000/MWh, average £100/MWh – 680MW x 3.5h = 2,380MWh – 2,380MWh x £100/MWh = £238,000 – gas trade 42,000 therms at 20p/therm – revenue of gas = £23,000 – deficit generated of £200,000 Less risk prior to gate closure © Innogy 2001
  33. 33. Benefits of Aggregation Reduces exposure to the balancing market Larger the number of units the lower the exposure the the balancing market Costs associated with over and under generation To make best use of aggregation need better than half-hour trading resolution © Innogy 2001
  34. 34. Planning for the Unplanned ‘E © Innogy 2001 ve ry t br ime ok I l en oo ’- kI sit fin e en d so gin m ee eth in r g
  35. 35. Planning for the Unplanned Inspections of plant always reveal something unexpected But power plants always run with broken parts! Question - when can I run on and when do I have to replace? © Innogy 2001
  36. 36. Commercial-technical Dilemma The business plan for the station is most often held at a senior level The budget for the station is most often devolved downward Dilemma - the financial year based budget holder may have a detrimental effect on the commercial long-term performance Trading makes the dilemma even more difficult to resolve! © Innogy 2001
  37. 37. Run/no-run? Row-one blade tip missing Cracking is found in blades Retaining pin has come loose but not damaged turbine Fretting and overheating of burner plates © Innogy 2001
  38. 38. Row-one Blade Tip Missing © Innogy 2001
  39. 39. The Story…. OEM - shut-down and install new Generator’s position - high pool price, no blades available, must generate Vibration levels within acceptable levels Engineering advice taken - O&M procedures put in place The machine ran on for six weeks with blades poor condition © Innogy 2001
  40. 40. Generator Transformer Failure © Innogy 2001
  41. 41. The Story…. Issue - main transformer failure, average failure rate once every ten years Problem - not cost effective to hold spare, major loss of output if fails, 18-month delivery times Solution - condition monitoring, insurance for business interruption, spare’s insurance © Innogy 2001
  42. 42. Cracking on Turbine Blades © Innogy 2001
  43. 43. The Story…. Concern - vanes burning due to insufficient cooling OEM - only half-set of vanes available Owner - need to operate for at least six months Operator - O&M procedures put in place based on Engineering advice Outcome - machine operated successfully for six-months © Innogy 2001
  44. 44. Generator Earth Fault © Innogy 2001
  45. 45. The Story…. Issue - rewind of stator three- to sixmonths Problem - total loss of generation, not cost effective to hold spares, long lead times Solution - condition monitoring, business interruption insurance and spare’s insurance © Innogy 2001
  46. 46. Lost Retaining Pin © Innogy 2001
  47. 47. The Story…. Concern - minor inspection showed that the pin was missing OEM - no new pins available for six-weeks Owner - need uninterrupted operation for next six weeks Solution - installed modified re-engineered design suitable for six-months operation © Innogy 2001
  48. 48. Fretting and Overheating © Innogy 2001
  49. 49. The Story…. Concern - minor inspection revealed excessive fretting and burning OEM - should not happen Owner - needed uninterrupted operation for next twelve months Solution - installed modified refurbished design suitable to reduce fretting damage and overheating © Innogy 2001
  50. 50. Decision Making © Innogy 2001
  51. 51. Run/no-run Decisions Who makes the decision? – OEM/competent engineer? – owner/banks? – insurers? – O&M contractor? – trader? All should be considered to some degree Driving factor is to keep the plant available © Innogy 2001
  52. 52. Run/no-run Decisions ‘We need to have a decision - NOW!’ ‘There are high prices available we’re loosing opportunity’ ‘I don’t want to know the technical details..’ © Innogy 2001 ‘What’s the risk of running on?’ ‘How long can we run safely for?’ ‘How long will it take to fix and how much will it cost’
  53. 53. Run/no-run Decisions Problem with making these decisions – best placed engineer is not the holder of the station business plan – holder of station business plan can understand the consequences but understands less the reasons Joint decision is therefore necessary – but must be made on equal basis – but quickly!! © Innogy 2001
  54. 54. Planning for the Unplanned © Innogy 2001
  55. 55. Planning for the Unplanned Before considering unplanned outages it is important to remember – insurers do not like surprises – surprises are expensive How can the number of surprises be minimised? © Innogy 2001
  56. 56. Planning for the Unplanned Before any outage a number of scenarios should be considered The scenarios should cover the major risks to outage duration A number of mitigation strategies should then be formulated Formalise risk process will aid the development of the strategies © Innogy 2001
  57. 57. Mitigation Strategies Plant condition monitoring to ensure ‘no surprises’ Regular visual and NDT inspections ‘Spares club’ to reduce the cost of emergency spares from the OEM Source of independent engineering advice to – challenge the OEM – provide O&M practices to manage the problem © Innogy 2001
  58. 58. Planning for the Unplanned Sometimes when it’s broken ‘it really is broken’ Important to have relationships with service providers to enable rapid stripdown and re-build – outage contractors – independent technical advice – parts suppliers (own, new or club) – de-stacking – stator re-winding © Innogy 2001
  59. 59. Opportunity Maintenance © Innogy 2001
  60. 60. Opportunity Maintenance It is important to identify repairs and maintenance with a fast turn-around to "hit" during small scale outages Ensures that annual plant availability is maximised Allows plant to maintained safely and effectively But ‘if it ain’t broke don’t fix it’ © Innogy 2001
  61. 61. Opportunity Maintenance Can be simple to identify – NGC working on lines and limiting export – TransCo limiting gas off-take – full shut-down for DCS up-grade – high fuel prices Can be difficult to resource Important to plan early so that resources are available © Innogy 2001
  62. 62. Making the Most of the Opportunities Good work management system required – keeps list of defects – produces lists of spares – instructs contractors – raises permits and work instructions for signing Could be paper-based but integrated system offers significant benefits © Innogy 2001
  63. 63. Competency and Resource Management © Innogy 2001
  64. 64. Competency and Resource Management Staff and contractors come and go…. ……..but the power station will remain Lessons learnt must be remembered if the power plant is to remain competitive This responsibility does not just rest with the management team Responsibility rests with the whole O&M team © Innogy 2001
  65. 65. Competency Need to define what competencies must be held by the O&M team Need to measure the competencies Important to manage the risk of losing ‘critical’ staff member without losing competency – develop other staff – identify potential recruits © Innogy 2001
  66. 66. Competencies The main competencies that are required to maintain and overhaul a CCGT are – E,C&I – mechanical Specialist competencies would (normally) be contracted Specialist labour (fitters, riggers, welders, etc) would be contracted © Innogy 2001
  67. 67. Competencies E,C&I – HV - generator, transformers, switch yard – MV/LV - motors, distribution, actuators – control systems – instrumentation Mechanical – gas turbine – steam turbine – HRSG – balance of plant © Innogy 2001
  68. 68. Competencies Start here to identify and measure your competencies Identify competency needs Measure competency level Identify personal training requirements Training ‘on the job’ or formal © Innogy 2001
  69. 69. Summary © Innogy 2001
  70. 70. Summary Commercial and technical considerations – identifies when the ‘best’ period for the outage Inspections and overhauls – read the OEM’s book but remember it’s only guidance Return to service – making the plant available is valuable, even if you do not generate © Innogy 2001
  71. 71. Summary Decision making – difficult decisions require both technical and commercial input Planning for the unplanned – plan for the unplanned and reduce the unexpected surprises Opportunity maintenance – balance maintenance with ‘if it isn’t broken don’t fix it’ approach © Innogy 2001
  72. 72. Summary Culture – ‘one team’ – ownership of outcomes Competency and resource management – what’s needed, where is it, how best to develop it? © Innogy 2001
  73. 73. Questions? © Innogy 2001