Operating efficiency of generating units depends on factors like the fuel used, labor required, loading patterns, duration of operation, and reliability. It varies between units due to differences in their capability curves and varying levels of wear, maintenance issues, and mechanical efficiency based on the manufacturer. Shifts in a unit's production function, which relates power output to inputs like fuel, labor, availability, and auxiliaries consumption, can affect its operating efficiency over time as these input coefficients change with wear and tear. Input costs also vary between units due to differences in wear and tear, technology, brand of generators, and age of machinery, and impact the production efficiency, which needs to be maintained positively.

1. Business Economics
KEY SELLING POINTS - Dr. Sunitha Raju
Assignment 01
Group 2
Mukesh Dhaniya (Roll No. 36)
Nitin Negi (Roll No. 44)
Pankaj Kotwal (Roll No. 46)
Rajiv Kumar (Roll No. 52)
Sahil Grover (Roll No. 58)
12Jan’12
EPGDIB-VSAT 2011-12

2. The Early Bird – Electric Power Load Dispatching
KEY SELLING POINTS
Questions (i): How is operating efficiency of the generating unit defined? Why does it vary
between units?
 Operating Efficiency of each Generating units depends on below factors:
o Fuel that it consumes
o Labor that it required to keep it running
o Loading pattern of units
o Duration of operation & reliability with which it has performed
o Wear and tear
 Operating Efficiency varies between units as factors affecting it
o Each generating unit has unique capability curve. The limits on the operation of the
generator are those imposed by the capabilities of the machine itself and are
determined by the design of the machine.
o Wear and tear, maintenance problems, and mechanical efficiency vary over time
and from generator to generator depending on who manufactured it.
EPGDIB-VSAT 2011-12

3. The Early Bird – Electric Power Load Dispatching
KEY SELLING POINTS
Questions (ii): How do shifts in production function affect the operating efficiency of the
generating unit?
Generator Production is function of:
GP= a + b1P1 + b2P2 +b3P3+b4P4…… + bnPn
Where,
o P1 : Fuel
o P2 : Labor
o P3 : % Availability of unit
o P4 : Auxiliaries consumption (accounts to 5% of total power produced)
The production function for a given generating unit will be different based on co
efficients b1…bn and it needs to be updated periodically as these co-efficients keep
changing with passing time of operation due to normal wear and tear.
These production functions of each unit are fed into Early Bird system to obtain marginal
cost (MC) for a particular generating unit at whatever rate it is being operated. Based on this
data, the dispatcher sends command to units to increase generation whose MC is lowest
when demand is increasing and send command to units to reduce generation whose MC is
highest when demand is falling. This is how using MC data, operating efficiency of each
units is kept at maximum.

4. The Early Bird – Electric Power Load Dispatching
KEY SELLING POINTS
Questions (iii): Why do input costs vary between units? How do they affect the production
efficiency?
Input Costs between units are varying due to the following reasons:
1) Wear & tear
2) Technology used
3) Generators used from different brands
4) Age of Machinery
For the production efficiency to be positive the above factors need to be maintained, else
the impact would be negative.
EPGDIB-VSAT 2011-12