Premium Power Quality contracts and labeling

KEMA Nederland B.V. Utrechtseweg 310, 6812 AR Arnhem P.O. Box 9035, 6800 ET Arnhem The Netherlands
T +31 26 3 56 91 11 F +31 26 3 89 24 77 contact@kema.com www.kema.com Registered Arnhem 09080262
30620162-Consulting 07-0401
Premium Power Quality contracts and
labeling
Work package 2 of the Quality of Supply and
Regulation project
Arnhem, 27 April 2007
Authors W.T.J. Hulshorst, E.L.M. Smeets, J.A. Wolse
KEMA Consulting
By order of the European Copper Institute

© KEMA Nederland B.V., Arnhem, the Netherlands. All rights reserved.
This document contains confidential information that shall not be transmitted to any third party without written consent of
KEMA Nederland B.V. The same applies to file copying (including but not limited to electronic copies), wholly or
partially.
It is prohibited to change any and all versions of this document in any manner whatsoever, including but not limited to
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KEMA Nederland B.V. and/or its associated companies disclaim liability for any direct, indirect, consequential or
incidental damages that may result from the use of the information or data, or from the inability to use the information or
data contained in this document.

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CONTENTS page
1 Introduction 5
1.1 Background 5
1.2 Objectives 6
1.3 Report outline 6
2 Power quality mitigation 7
2.1 Who is responsible? 7
2.2 Voltage quality dimensions 8
3 Power quality contracts 10
3.1 Power Quality contracts EdF, France 10
3.1.1 Background 11
3.1.2 Principle 11
3.1.3 Build up 11
3.1.4 Measurement 13
3.1.5 Power quality services 13
3.2 Premium Power Quality contract, Italy 14
3.2.1 Power quality objectives 14
3.2.2 Performance monitoring 14
3.3 Eskom, South Africa 16
3.3.1 Background 16
3.4 Detroit Edison Company’s, USA 18
3.4.1 Background 19
3.4.2 Agreements regarding interruptions 20
3.4.3 Agreements regarding to voltage dips 21
3.5 United Illuminating Company, Connecticut, USA 25
3.6 Public Service Electric & Gas, New Jersey, USA 25
3.7 Argentinean experiences of delivery quality 26
3.8 Power Quality Measurements 26
3.9 Summery Power Quality contract 28
4 Power quality classification 29
4.1 Flicker 31
4.2 Harmonics 33
4.3 Voltage variations 33
4.4 Voltage dips 38
5 Conclusions 43
Appendix A 46

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1 EXECUTIVE SUMMARY
Customer power quality and reliability needs differ greatly. An established basic level is not
adequate for all customers. Customers requiring higher reliability or increased power quality
can take action to obtain the level of service they need. Competitive markets minimize the
costs and ensure that customers have a choice in obtaining these levels.
An interesting problem arises when the market fails to offer products that meet customers’
power quality needs. If customers cannot find equipment that is designed to tolerate
momentary power interruptions, for example, they may pressure the supplier and the
regulator to increase the power quality of the overall distribution system. It may be in the
supplier’s interests to help customers address the power quality and reliability problem
locally.
Even before regulation started, utility companies in some countries had offered premium
power quality contracts. Customers can choose the minimum level of power quality needed
within a contract between the utility and the customer. For a higher price, a form of
assurance is given of a minimum level. If this level is not met, financial compensation is paid
by the utility company. Most of the contracts deal with reliability and voltage dips. To register
the power quality level, a measuring device is often located at the customer’s supply point.
Results have shown that the power quality level of customers having a power quality contract
increased. Since most of the power quality contracts had already started before regulators
existed, regulators are not necessary for setting up power quality contracts, these can be
arrived at by mutual agreement between the utility companies and (groups of) customers.
For other groups of customers, regulators could stimulate a classification model where for
example an A means a high power quality level and an F means a low power quality level.
One DNO is starting to use this model in the Netherlands. Within the premium power quality
contracts or power quality classification it should be noted that DNOs cannot be fully
responsible for the power quality at the point of supply to the customer. Other customers do
have an impact on the power quality but a TSO can also have an influence on the power
quality at the point of supply.

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INTRODUCTION
1.1 Background
It is generally known that quality is an important aspect of the electricity service. Not only are
low prices important, but quality also matters to customers. Price and quality are
complementary; together, they define the value that customers derive from consuming
electricity. Deregulation introduces a clear business separation between energy suppliers
and network operators. New types of companies, called “Distribution Network Operators”
(DNO), are responsible for the distribution of electricity to customers and fair competition.
In this general context, guaranteeing an acceptable Quality of Supply is also one of their
tasks. As discussed in WP 1, nowadays the Quality of Supply is to have three major
components: energy supply reliability, voltage quality (also known as power quality) and
“commercial” quality (linked to the quality of the customer relationship and customer
satisfaction).
Among the parameters that make up the Quality of Supply, reliability is obviously the first one
being systematically taken into account in regulations or contractual applications. Nowadays
the next step could be the regulation of voltage quality (see WP4/5). Although responsible for
the quality delivered to the end consumer, DNO also depend on the quality available
upstream, at the transmission networks level (operated by the TNO).
In order to avoid the high cost of equipment failure, all customers have to make sure that
they obtain an electricity supply of satisfactory quality and that their electrical equipment is
capable of functioning as required when small disturbances occur. This can only be
guaranteed if the limits within which the power quality may vary can be specified. Such limits
can be defined by standards, by the national regulator, by the customer in a power quality
contract, by a manufacturer in a device manual or by the grid operator in an operating
guideline. These limits must be meaningful and transparent, and it must be easy to compare
actual power quality levels against them. Coordination of all these different limits is
necessary, on the one hand to prevent devices or installations from malfunctioning, and on
the other hand for clear communication about the quality of supply that is provided or
demanded.

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1.2 Objectives
As explored in the first report of this series1
, there is currently a shortage of experience in the
regulation of voltage or power quality. At the same time, it is also true that voltage quality
regulation is more complex to implement than the regulation of interruptions or commercial
quality. This is mainly due to the multi-dimensional nature of voltage quality and the inherent
difficulties in its measurement. Nevertheless, there is also a trend of regulators becoming
more aware of the need for voltage quality regulation and taking steps in that direction.
This report describes the action taken by grid operators and customers by means of premium
power quality contracts. Most of these contracts had already been mutually agreed between
customers and grid operators before regulators existed. The goal for premium power quality
contracts or the classification of power quality is to guarantee acceptable quality levels at the
end-user’s connection points. Where possible, this report considers the five main voltage
quality dimensions, namely: (1) (short) interruptions, (2) voltage dips, (3) flicker, (4) supply
voltage variation, and (5) harmonic distortions.
1.3 Report outline
This document deals with a desk survey to show the different types of Premium Power
Quality contracts already used in some countries around the world (e.g. France, the USA and
South Africa). In Chapter 3 we describe the background and the methodology used by the
different companies. In Chapter 4 we describe a simple classification methodology of
labelling Power Quality on a single PCC developed by some of the Dutch utility companies.
This report (work package 2) is part of a program on the quality of supply and regulation.
Within work package 1, a survey was made to establish the regulation of quality (reliability
and voltage quality) within Europe. In work package 3, the sensitive consumers (or type of
consumers) regarding power quality will be established. Finally, in work packages 4 and 5
general guidelines will be made as a starting point for the regulation of power quality.
1
KEMA (2006) “Quality of supply and market regulation; survey within Europe” Arnhem October 11,
2006.

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2 POWER QUALITY MITIGATION
Customer power quality and reliability needs differ greatly. An established basic level is not
adequate for all customers in the grid. Customers requiring higher reliability or increased
power quality can take action to obtain the level of service they require. Competitive markets
minimize costs and ensure that customers have a choice in obtaining these levels. A study
performed by Oak Ridge National laboratory2
for the US Department of Energy addressing
the market’s role can also be used for the European markets. The cost of solving a power
quality problem depends on the location in the grid. The power quality in a grid differs for
each location. While some solutions may be cost effective for solving a power quality at one
location in the grid, it might have less or even no effect at another location in the grid.
Customers can install equipment within their facilities to achieve any desired level of power
quality and reliability they desire. Filters, surge protectors, UPS, and backup generators are
all available. Further, the customers can decide if it is necessary to increase the reliability or
power quality for the entire facility, or if it is more cost-effective to address individual loads
within the facility. Only the customers know the value of increased reliability or power quality
for their situation.
A typical home may have a number of high power loads such as a heat pump, water heater,
oven, dryer, refrigerator and freezer. While none of these loads is particularly sensitive to
momentary power interruptions, a few of the electronic loads within the home (e.g. the digital
clock in the VCR, microwave and oven) are. Yet these sensitive loads are an insignificant
portion of the energy or power demand. It makes little sense to raise the power quality and
reliability of the entire distribution feed in order to serve these loads. It makes much more
sense to either design the clocks with enough energy storage to ride through momentary
interruptions, or to connect the individual appliances to a UPS.
2.1 Who is responsible?
An interesting problem arises when the market fails to offer products that meet the
customers’ power quality needs. If customers cannot find equipment that is designed to
tolerate momentary power interruptions, for example, they may pressure the DNO and the
regulator to increase the power quality of the overall distribution system. It may be in the
DNO’s interest to help customers address the power quality and reliability problem locally.
2
Measurement practices for reliability and power quality; Oak Ridge National Laboratory, June 2004

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European Standard EN50160 is generally used in European countries as a basis for the
quality of supply, which is often defined as the voltage quality or power quality. At this
moment, there is no standard for the current quality at the Point of Common Coupling (PCC),
but only for equipment. The interaction between voltage and current makes it hard to
separate the customer as “receiving” and the network company as “supplying” a certain level
of power quality. The voltage quality (for which the network is often considered responsible)
and the current quality (for which the customer is often considered responsible) affect each
other by mutual interaction.
Figure 2.1 Voltage versus current quality
In general, the grid operator is responsible for the voltage quality at the PCC. However, as
we have seen with the European survey on the quality of supply, there are situations where
the grid operator cannot be blamed, such as:
• disturbances within the transmission grids having an impact on the PCC in a
distribution grid,
• force majeur events
• external failures caused by third parties.
2.2 Voltage quality dimensions
We will focus on the most important aspects from a customer’s perspective. In a report3
published under this project, we concluded that, next to (short) interruptions, the following
power quality parameters are considered to be the most important ones for customers:
• supply voltage variations: A voltage variation is an increase or decrease in voltage
normally due to variation in the total load of a system or a part of it.
• flicker severity: Voltage fluctuations cause changes of e.g. the luminance of lamps, which
can create the visual phenomenon called flicker. The degree of unsteadiness of human
visual sensation via a lamp, called ‘flicker’, is strictly related to the fluctuation of the
voltage supplying the lamp, the characteristics of the lamp and the physiology of the eye-
brain of the person involved.
3
WP 3 “What PQ levels do different types of customers need”; KEMA 2007

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Sources of flicker are mainly heavy industrial loads:
o Resistance welding machinery
o Arc furnaces
o Rolling mills
o Large motors with varying loads
o Step changes due to switching heavy loads
But elevators, refrigerators and other small household equipment can also cause flicker.
Flicker sources can affect a large number of customers. As there is a wide range of supply
impedance on the public networks, conditions change substantially from the substation up
to the end of a feeder.
• harmonic distortion of the voltage waveform: A sinusoidal voltage at a frequency equal to
an integer multiple of the fundamental frequency of the supply voltage. Harmonics in the
supply voltage are mainly caused by non-linear customer loads connected to all voltage
levels of the supply system. Harmonic currents flowing through the system impedance
give rise to harmonic voltages. Harmonic currents and system impedances and thus
harmonic voltages at the supply terminals vary in time. Harmonics are mainly caused by
industrial and residential loads with non-linear characteristics. A source may produce
harmonics at a constant or a varying level, depending on the mode of operation. Industrial
loads that may be a source of significant levels of harmonic distortion include power
converters, furnaces, etc.
• supply voltage dips: Dips are a different type of phenomenon than the others. Where it is
possible to evaluate system performance against a harmonic, flicker or unbalance index
over a relatively short period (e.g. a week), voltage dip performance must be evaluated
over a longer period of time (at least one year). Voltage dips with a retained voltage below
an interruption threshold (typically 10% of the stated voltage) are referred to as short
interruptions in a number of (inter) national standards and guidelines. The amplitude of a
voltage dip is defined as the difference between the actual voltage and the nominal
voltage of the system. Voltage changes that do not reduce the system voltage at the point
under consideration to less than 90% of the nominal system voltage are not considered to
be voltage dips as this is within the range of slow voltage variations and voltage
fluctuations, for example, due to rapid and repetitive load changes. It is essential to
understand that a certain number of voltage dips cannot be avoided in supply networks
and that for most equipment it is normal to accept the risk of a limited number of incorrect
operations due to this type of disturbance. Voltage dips are mainly caused by faults in the
supply network due to lightning, accidents, damage to installations, etc. or high starting
currents and rapidly varying loads in a customer's system.

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3 POWER QUALITY CONTRACTS
The availability of sophisticated and sensitive net technologies has led customers to demand
higher levels of power quality. To meet these needs, some utility companies have set up
premium power quality contracts for their customers. For customers who wish premium
power, in many cases, the most cost effective method for addressing the power quality and
reliability is modifying the distribution system in all customers on that branch of the system
needing mitigation, or if customers are not charged (or very partially) for systems upgrades.
The distribution company can identify the additional costs involved in providing this type of
above average service and bill the customer for it. The customer is free to evaluate this
solution against local alternatives.
On the other hand, some price sensitive customers can be interested in reduced costs and
are perhaps willing to accept lower levels of reliability than the level provided under the basic
regulated service. These customers can “sell” interruption rights back to the power system.
The distribution company can then interrupt these customer when the system is under stress
and avoid interrupting other customers.
The utility companies in some countries around the world have set up a program for power
quality contracts. The best known programs are discussed in this chapter, which provides a
brief synopsis of many organizations that have ongoing activities in power quality or
reliability. This list is not intended to include all the utility companies, but rather only the
significant ones that are presently involved in examining power quality contracts. This list is
mainly based on the reports
4 5 6 7 8 9
.
3.1 Power quality contracts EdF, France
In France, both the Transmission System Operator (RTE) and the main distribution company
(EdF) offer their customers customized contracts with assigned voltage quality levels
(“engagements” or contractual levels). If the customer claims for better contractual levels
than the normal ones, he can ask the operator for customized contractual levels in his
contract, paying an extra charge. Customers who have customized contractual levels must
4
Ceer third benchmarking report on quality of electricity supply – 2005.
5
God elkaviteit (in Swedish), STRI;10-2003
6
EPRI Power Quality newsletter, Spring 1997, Number 2
7
Different websites of the utility companies referred to in this chapter
8
Regulation on voltage quality, WP4/5, KEMA 2007
9
Roundtable on power quality at the interface T&D, Cired 2003

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have a monitoring recorder installed (it can be owned by the customers themselves or by the
network operator). The existence of voltage quality contracts has led to a high diffusion of
voltage quality.
Recorders installed at the connection point of single customers: in distribution networks,
about 16% of MV customers have a voltage quality recorder installed; in the transmission
network, the figure is about 12% of EHV-HV customers.
3.1.1 Background
At the beginning 1990 the use of increasingly sophisticated and more sensitive electronic
equipment led to EdFs customers requesting higher levels of electricity quality. In order to
fulfill the customers’ needs, EdF set up a number of electricity quality contracts and services
for large and medium customers. In 1994, EdF began to use the so-called Emeraude
contract as an experiment for 6,000 customers. The contract had been developed jointly
between EdF and customer representatives.
3.1.2 Principle
The Emeraude contract applies the principle of compensating customers for damage if the
utility company exceeds an agreed upper limit on the number of power disturbances. EdF
guarantees minimum levels of power quality in the contracts and customers must not exceed
maximum levels for emissions to the system. If customers exceed their limits, they may be
required to find a mitigation solution, especially if they impact the power quality delivered to
other customers. Both the levels are decided at the national level and are approved by the
appropriate authority.
3.1.3 Build up
The Emeraude contract consists of three different types of package:
1. Basic contract with standard quality thresholds
This contract is used by EdF to serve a majority of MV customers. For a period of one year it
covers specified levels of power disturbances both from supply companies and customers
during normal operation of the power network. The regional threshold value for the number of
interruptions is decided each year with reference to the population density in four areas in
France. It has shown to be successful for offering standard levels of electricity quality.

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Table 3.1 shows some values that EdF guarantees at medium voltage and what is required
from the customers. If EdF exceeds the values in the table, the customers can demand
compensation for damages and losses incurred.
Table 3.1: EdF’s and customers' obligations for medium voltage in 1997 (basic contract)
Quality parameter EdF’s annual electricity
quality obligation
Customers’ electricity
quality obligation
Planned interruptions (work on
the net)
Number < 2
Duration < 4 hours
No
Long interruptions (>3 min)
(Number)
<10,000 inhabitants: 6
10,000-100,000 inhabitants: 3
>100,000 inhabitants (except
cities): 3
Cities >100,000 and Paris
suburbs: 2
No
Short interruptions (1 s – 3
min) (Number)
<10,000 inhabitants: 30
10,000-100,00 inhabitants: 10
>100,000 inhabitants (except
cities): 3
Cities >100,000 and Paris
suburbs: 2
No
Voltage variations (RMS) Voltage is ± 5% of contractual
voltage and Uc is
± 5% of nominal voltage
No
Voltage fluctuations and flicker PLT: ≤ 1
(measured according to
IEC 1000-4-15)
Voltage changes in stages: <5%
of contractual voltage.
(measured according to
IEC 61000-2-2)
Unbalance ≤ 2% ≤ 1% if Short Circuit Power >40
MVA
Frequency 50 Hz ± 1%
50 Hz +4% and -6% (island
systems)
No
Harmonics (temporary clause) Harmonics: 10 minute values
according to EN 50 160 and IEC
61000-2-2)
Levels are defined as a function
of the order number, according
to agreement
Customer adjusted
agreements. Short
interruptions (1 s – 3 min)
Voltage sags
Customer-adjusted values
Not taken in account are:
Duration < 600 ms
Residual voltage >70%
No
2. Basic contract with customer-adjusted levels:
This agreement is offered to customers whose operations are sensitive to power
disturbances. This contract gives a more comprehensive guarantee, allowing the threshold
number of short power supply interruptions and voltage sags to be determined by the
customer requirements. This customer-adjusted agreement can be established for longer
periods than a year and costs about 1,000 euros per year if the agreement covers voltage

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sags and approximately 500 euros per year if the agreement does not include voltage sags.
This fee pays for EdF’s installation of on-site monitoring equipment and the production of a
yearly report, both of which help keep customers apprised of their power supply and
equipment characteristics.
3. Plus contract (Réseau plus):
This contract guarantees the maximum yield for customer installations with very sensitive
processes demanding high levels of power quality. As a part of this contract EdF conducts
studies when critical improvements of the power supply system become necessary. EdF and
the customer share the costs for the investigations in proportion to the customer needs, the
power network's properties, and the number of disturbances generated by the customer and
EdF. The investigations have a dual purpose: to enhance EdF’s power supply and to make
the customers installations less sensitive to disturbances.
3.1.4 Measurement
In order to ensure a broad application of Emeraude, EdF started the development of new
electronic monitoring that can be installed at the PCC to characterize and record power
disturbances such as long and short interruptions, voltage dips, overvoltages and RMS
voltage variations. This measuring equipment will provide EdF with objective figures and
statistics for use in reports to customers on the quality of the electricity service. This
equipment should also considerably reduce the costs of data collection and analysis.
3.1.5 Power quality services
In addition to Emeraude, EdF offers a variety of power quality services to large and medium-
sized customers:
The Fiabelec service is offered to customers who want to make their electrical installation
less sensitive to power disturbances. It ensures a power quality that matches the costumer’s
needs. The cost of the service depends on the complexity of the problem to be solved,
costumer requirements, and network characteristics. Jointly provided by equipment
contractors and more than 100 local units of EdF, this service includes:
• technical and economic studies of suitable solutions
• diagnosis of customer installations
• operation and maintenance equipment
• equipment operation and maintenance
• Commissioning of power conditioning equipment

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• Equipment performance guarantee, which includes an indemnity in case of failure.
The Prevenance service is a free service that arranges for EdF to consult with customers
about appropriate dates and times for performing maintenance and improvement work on the
power supply network.
The Echo Réseau service, also free of charge, allows EdF to provide information about the
quality of their power supply to customers planning factory construction or expansion
projects.
3.2 Premium Power Quality contract, Italy
In Italy, the energy regulator (the Autorità) is responsible for setting tariffs and quality
standards. According to its founding law, the main objectives of the Autorità are to guarantee
the promotion of competition and efficiency and to ensure adequate service quality standards
in the electricity and gas industries. To achieve this, the Autorità has legal powers to
establish minimum quality standards with corresponding incentives (penalties/rewards). This
has for example been implemented in the case of continuity of supply.
3.2.1 Power quality objectives
At this time there is no regulation system for voltage quality in Italy. Preparatory steps have
however been undertaken by the Autorità to establish such a system in the future. The
Autorità strategy is to first get a better understanding of existing voltage quality levels in Italy.
As part of this, the following activities have been undertaken:
1. A voltage quality measurement campaign has been set up. Utility companies have to
install voltage quality meters at strategic locations and report on voltage quality
performance to the Autorità.
2. There is also an obligation for utility companies to install voltage quality meters at the
request of customers. The costs of these meters are borne by the customer.
3. Finally, there is the possibility for customers and utility companies to enter into a
voltage quality contract. Currently, however, no voltage quality contracts have been
established.
3.2.2 Performance monitoring
The Autorità launched a performance monitoring campaign in early 2006. The measurement
campaign will last for 2 years, i.e. until early 2008. As mentioned earlier, the objective of this

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campaign is to gain better insight into the existing levels of voltage quality in Italy. The
underlying objective of the monitoring campaign is to collect reliable and robust voltage
quality data. This data forms the starting point for an envisaged voltage quality regulation
system.
At this time, there are about 600 locations where voltage quality meters are installed. The
choice of location of the meters is such that the measurement data is a good reflection of the
Italian distribution network. Meters are dispersed all over the country more or less in
proportion to the number of MV substations.
About 400 meters have been installed on the bus bars of MV and HV/MV substations. The
costs of these meters are paid through the R&D component of the tariff. Furthermore, an
additional 200 meters have been installed at delivery points to customers. The Autorità had
campaigned strongly for customers to install voltage quality meters. Of these 200 meters, 75
were requested and paid for by customers at their delivery point. The other 125 meters are
installed at supply points to other customers. Their costs are paid by the utility companies.
The specifications of the meters to be used for measurements have been developed by the
Autorità on the basis of IEC 61000-4-30 “Testing and measuring techniques – Power quality
measurement methods”. The following voltage quality aspects need to be monitored and
reported:
1 supply voltage variations
2 supply voltage dips and peaks
3 voltage interruptions
4 voltage harmonics
5 flicker
6 supply voltage unbalance and
7 rapid voltage changes.
A deliberate decisions has been made to exclude certain voltage quality dimensions from the
measurement systems. For example, frequency is not included as it is not considered to be
controllable by a distribution company. Furthermore, the measurement of voltage transients
and mains signalling voltages are considered to be too costly. This in particular requires
more expensive measurement devices driven by the increased need for memory capacity.
The results of the measurements are published by the utility companies to the Autorità who
analyses the data. In addition to analysis, the Autorità also publishes the submitted voltage

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quality data on a website (http://queen.ricercadisistema.it). Publicly available data is
aggregated and cannot be traced back to individual measurement points.
The present monitoring effort will form the basis for further decisions regarding voltage
quality regulation. It is anticipated that after the campaign is over, the Autorità will have much
better insight into existing performance levels. This will help in the development of a suitable
voltage quality regulation system.
3.3 Eskom, South Africa
Since electricity production plants and customers in South Africa are located a long way from
one another geographically, Eskom had some serious problems with the power quality due to
the long distances covered by the overhead lines. A program developed to follow the
customer’s requirements was set up and nowadays the South African standard for voltage
dip classification is referred to often.
3.3.1 Background
Eskom introduced an extensive power quality program at the start of 1990. It was considered
to have such a high priority that the performance of the network was linked to the
remuneration for the management of the company. The program was developed to follow the
customers’ explicit needs for enhanced power quality levels and the changing face of South
African industry since its re-acceptance into world markets.
In 1992, Eskom started implementing extensive power quality measurements at more than
150 of its transmission and distribution substations to quantify the levels of power quality
experienced by customers. The main reason for implementing the measurement program
was to address an increase in customer plant sensitivity and, hence, greater awareness of
power quality.
In conjunction with the power quality measurements, Eskom started two other projects. First
was an interview survey about power quality; a series interviews with over the half of
Eskom’s large customers (>5 MVA) in order to discover the costs incurred by the customers
due to power quality variations. This resulted in the development of an economic model for
six industrial sectors - chemistry, paper and mass, mining (gold and coal), textiles, food and
beverages, and metals. The use of this model allows Eskom to predict customer costs for
each type of electricity disturbance and has been incorporated into the electricity company's

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net planning.
The other project was to investigate possible high power solutions for power disturbances for
application behind the meter. Eskom identified a number of new solutions and bought and
installed three different equipments with competing technology - Statordyne, Written-Pole
motor-generator and Superconducting Storage device. The objectives of project were to:
• demonstrate concepts for solutions at the customers side
• develop skills and tools to allow the use of new technology in the power system.
The three projects mentioned above: measurement, survey of the customer’s costs and
demonstration of new technology, were crucial for developing Eskom’s power quality
services.
In 1995, Eskom introduced detailed power quality contracts at individual customer’s
interfaces and at bulk supply points. These contracts include both utility company
commitments and customer (emission) commitments. Voltage magnitude, harmonics,
imbalance, flicker, rapid voltage changes, frequency, voltage dips and interruptions are
addressed. In order to meet the requirements of these contracts, Eskom has implemented
internal power quality agreements at T&D interfaces.
Eskom offers three different types of guaranteed power quality contract:
1. Delivery according to national power quality standard (NRS 048)
2. Network-specific option
3. Premium power option.
Alternative 1 (NRS 048) means that Eskom guarantees a minimum power quality level
according to the NRS 048 standard. If the level is not met, Eskom is obliged to improve the
power quality to the costumer. If the costumer had a better quality than the minimum before
the NRS 048 was introduced, the costumer pays no additional charges for this and does not
need to sign agreements.
Alternative 2 (Network-Specific Option) means that the customer gets a better power quality
compared to the NRS 048. Eskom examines and establishes what level of power quality can
be offered from existing nets. A customer-adjusted agreement is signed with the customer,
who has to pay a certain part of the cost of the survey.
Alternative 3 (Premium power option) provides the customer with a better power quality than
the Network-Specific Option. Eskom invests in the net or on the customer’s side. This
alternative guarantees customers an improved power quality at a fixed cost during the

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contract period. If Eskom does not reach the levels of power quality agrees in the contract,
the customer gets the amount that is agreed in the contract. The customer can cancel the
agreement after a notice period and is also able to increase the agreement, if desired. The
Premium power option functions in this way:
1. a customer requests a level of electricity quality that exceeds what the system can
deliver
2. Eskom performs a technical study of the customers plant and power networks in order
to determine the sensitivity of plant equipment and how often power disturbances occur
3. Eskom develops and designs the solutions to meet the required power quality
performance levels
4. both parties negotiate and agree on a monthly charge for the required performance
level
5. Eskom purchases, installs and commissions the necessary power conditioning
equipment at the customer plant.
6. Eskom carries out maintenance during the period of agreement.
Service contracts are also offered that provide the consulting and reconfiguration support
listed in the first four steps above. Customers and consultants have been very positive,
assisted by the fact that a set of minimum quality of supply standards NRS 048 was
established for South Africa as a whole.
Eskom realizes that it is not possible to achieve an ideal level of power quality. However, it
has shown that it is possible to implement practical solutions for complex problems in a
profitable way.
3.4 Detroit Edison Company, USA
The Detroit Edison Company (DEC), a subsidiary of DTE Energy, is one of the largest
electricity utility companies in the USA. It serves more than 2.2 million customers in South-
East Michigan, the America industrial heartland. DEC offers a special manufacturing contract
(SMC) with premium power quality for manufacturers (automotive industry) in their region.
On the other hand, DEC also offers special interruptible rates to residential, commercial and
industrial customers. Customers get discounted electricity prices in return for permission to
occasionally interrupt electrical service (see textbox). Although shown on the website as a
power quality contract, we did not include this contract because it is rather more a DSM
contract than a power quality contract.

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3.4.1 Background
Most electricity suppliers deliver electricity at a basic quality that is acceptable for the
majority of large customers. There are however electricity consumers that need electricity
with a higher quality, especially if they have sensitive electronic equipment that is sensitive to
voltage dips. The cost of production losses caused by voltage dips has increased in recent
years for the manufacturing automotive industry located in the Detroit Edison Company
distribution area.
The DEC Special Manufacturing Contract (SMC) was introduced in 1994 for three of DEC's
largest customers: the Chrysler Corporation (after 1998, DaimlerChrysler), the Ford Motor
Company and General Motors Corporation.
Because of increased competition in the automotive industry, these companies wanted to
decrease their costs; DEC on the other hand was cautious about losing these companies to
other electricity suppliers. The companies wanted to have a long term contract for electricity
with competitive and predictable prices. Therefore, DEC set up a 10-year contract with these
customers. This contract is known as the Special Manufacturing Contract (SMC) and was
introduced in collaboration with EPRI.
In order to become the preferred electricity supplier for the period of 10 years the
manufacturers wanted guarantees for interruptions and voltage dips. Therefore, DEC and the
manufacturers agreed on a method for compensating customers for electricity disturbances
in case a certain annual level was exceeded. The amount of compensation is related to the
manufacturers’ costs for production losses due to disturbances. The delivery guarantees
Residential Interruptible Air Conditioning Rate
Our Interruptible Air Conditioning Program could save you up to 20% off your basic service rate. To
take advantage of this special rate, your central air conditioner or heat pump is wired to a separate
meter and radio control unit.
By allowing us to briefly cycle your service by remote control on very hot days or when there is a high
demand for electricity, you save over the basic residential rate. The cycles are limited to 15 minutes
maximum at a time followed by at least 15 minutes of operation and limited to no more than eight
hours in a 24-hour period so they should not noticeably affect the temperature inside your home.
Source: www.dteenergy.com visited 20 February 2007

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concerning interruptions started in 1995, and the guarantees concerning voltage dips started
in 1998.
3.4.2 Agreements regarding interruptions
The agreement applies to 58 plants operated by the three car manufacturers. It covers
offices, assembly factories, and processing plants and component delivery departments. The
SMC specifies that the car manufacturers are compensated when certain levels have been
exceeded. The level for interruption was based on measurements for the year 1993. For
some of the plants the interruption frequency varies between 0 and 1, meaning that at some
of these plants there can be a maximum of one interruption a year, while other plants are not
allowed to have a single interruption in the same year.
The penalty for interruption agreed in the contract varies according to the type of activity that
the electricity supply serves (office building, etc.). An example for the Ford plants is given in
table 3.2.
Table 3.2: Interruptions and penalties (Ford Motor Company)
Type of activity Number of
production plants
Numbers
interruptions a year
Penalty
Assembly and
pressing
6 3 $50,000 - $88,000
Gearboxes 4 2 $159,000 - $326,000
Components 9 9 $16,000 - $152,000
Offices 1 1 $30,000
Other 8 3 $2,000 - $11,000
Affiliates 1 1 $2,000 - $11,000
The conditions in the contract related to the number of interruptions have initiated a number
of projects in order to reduce the number of interruptions. The number of interruptions has
been reduced by using multiple supply paths. Although this has decreased the number
interruptions, the number of voltage dips has not been improved. Since interruptions are
normally worse than voltage dips, this does mean an improvement in the quality.
The results show that the number of interruptions within the electricity grid has reduced. The
car manufacturers have had fewer interruptions since this contract. The number of
interruptions in 1997 was 4% less than in 1995, and in 1998 the interruptions decreased by
an additional 32% compared to the year before. What is perhaps more interesting is that

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penalty payments in 1997 decreased by 40% compared to 1995 and by an additional 25%
during 1998.
3.4.3 Agreements concerning voltage dips
The 1994 agreement specified that voltage dips were to be included at a later stage because
DEC did not have adequate measurement results concerning voltage dips before the
agreement started. It was considered to be too risky for DEC to set up a contract without
knowing the expected number of voltage dips per year. Since the car manufacturers wanted
voltage dips levels to be included in the contract, DEC agreed to install power quality
monitoring equipment in all the plants to which the agreement applied. The intention was to
collect sufficient data to decide on the levels of the voltage sags in the contract.
In 1995 DEC began to install power quality monitoring devices. With the results of the PQ
monitoring devices it was possible for DEC to establish how often and with what strength
(magnitude and duration) the voltage dips occur at the 58 plants.
In the addition to SMC it was necessary to identify a ”qualified voltage sag” and a ”non-
qualified voltage sag”. A ”qualified voltage sag” is a voltage dip in the RMS voltage on some
of the phases remaining less than 75% of the nominal voltage. The duration doesn’t matter.
The factors taken into consideration in order to find the level of 75% included the Information
Technology Industry Council curve (ITIC Curve, the successor to the Computer Business
Equipment Manufacturers Association curve, CBEMA curve) and discussions with the car
manufacturers about what the considered levels of voltage dips would be.
CBEMA has developed a recommended capability curve for single-phase data processing
equipment operating at 120 volts (60 Hz). The ITIC provides an easier graphical format to
reproduce and requires improved ride-through capability for minor voltage dips.

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Figure 3.1 ITIC curve (ITIC – Information Technology Industry Council)

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Figure 3.2 CBEMA curve (CBEMA – Computer Business Equipment Manufacturers
Association)
The curves have been designed empirically in order to illustrate the correlation between
magnitude and duration for voltage dips. Voltage dips within the voltage tolerance curve do
not normally affect electronic equipment. The curves are used by the producers of electronic
equipment (computers, etc.) as a guideline for what the equipment has to tolerate.
Approximately 15% of voltage dips measured by DEC's monitoring system are deeper than
75% of the nominal voltage. Voltage dips caused by the customers are not taken in account,
nor are voltage dips that are measured on phases that are not loaded. If during a dip the
current is below a certain level, the phase is without load and the voltage dip is not taken as
qualifying. These rules ensure that only dips in relation to DEC's operations are evaluated.
Only the deepest voltage dip during a 15-minute period at each production site is counted as
qualifying. A 15-minute period starts when the first voltage dip in chronological order is
registered and ends when either the last voltage dip is registered or 15 minutes after the first
one has been registered. If an interruption is registered during a 15-minute interval, no
voltage dip is taken as qualifying during this interval. This prevents possible overlaps in the
agreement on average interruptions and voltage dips.

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For the calculation of a penalty, DEC has defined a method for calculating the depth of the
voltage dip. This so-called sag score is calculated by measuring the lowest voltage per
phase during the 15-minute interval for each plant. The sag score is then calculated by:
“Sag Score” = 1 - (Va+Vb+Vc)/3
The “Sag Score” will always be between 0.0833 and 0.9999. A “Sag Score” of 0.0833 will be
obtained if one phase is 75% of the nominal voltage, which is the threshold for a qualifying
voltage dip, while the other two phases have voltage levels of 1.0. A “Sag Score” of 1 is
when Va=Vb=Vc=0; which means a voltage interruption and thus does not have to be
included in the agreement concerning voltage dips.
The “Sag Score” limits are decided for groups of production locations. A “Sag Score” limit is
the maximum sum of allowable “Sag Scores” for a group of production locations. Daimler-
Chrysler has one “Sag Score” limit, like General Motors. The Ford Motor Company has six
“Sag Score” limits for different types of production plant.
The penalties for voltage dips are paid at the end of each year. A penalty is paid for each
plant where the “Sag Score” exceeds the agreed “Sag Score” limits. For example, if the
calculated sag score = 3.20 and the agreed sag score limit is 3.00, the penalty will be (3.20 –
3.00) multiplied by the penalty ($). The aim is to avoid penalties without making
improvements in the electricity grids. The aim is a driving force behind optimal
improvements.

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Table 3.3 shows an example of a “Sag Score” report produced by DEC for General Motors.
Table 3.3 Sag Score Report for General Motors
3.5 United Illuminating Company, Connecticut, USA
UIC is one of the electricity companies with a grid in the USA. It is perhaps the electricity
company that makes the most extensive measurements of all. Continuous measurements
are made on the medium voltage network. UIC uses their measurement data to perform
benchmarking. UIC uses their measurement data partly for focusing on customer needs, but
also for planning long-term improvements in the grids. They use also their measurement data
to inform potential customers about how many voltage dips they can expect in different parts
of the power network. In this way, sensitive customers can choose where the most
appropriate place is to settle a new establishment.
3.6 Public Service Electric & Gas, New Jersey, USA
PSE&G benchmarks their system through measurements, but also through customer
surveys and quarterly telephone interviews of selected groups of customers. When it comes
to reliability they make improvements in the poorest sections. Power quality becomes more a
result of ongoing work on improving the reliability.

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Reporting is made according to the methods stated in IEEE 1366 and according to the ”state
regulatory commission”. There is no requirement to report in SARFI but PSE&G follows up
SARFI for discussions with the customers. Measurements are made regularly in
transmissions and distribution grids to meet the requirements of reporting to the ”state
regulatory commission”.
3.7 Argentinean experiences of delivery quality
In 1992, Argentina introduced a system with penalties in order to decrease the number of
interruptions in the power networks to international levels. The change to a lower number of
interruptions was implemented over a period of three years with gradually increased
requirements on the reduction of the number interruptions, while penalties were gradually
increased. There were two aims: to compensate the electricity consumers and to give the
utility companies a signal for investments.
In order to get a better grip on the technical quality of supply, measurements were started to
record the interruptions in the medium voltage grids at Edenor, Edesur and Edelap at
medium voltage levels. Several indexes of reliability were tightened during the three year
period and in the case of exceeding the levels a penalty payment was credited to the
customer rated at up to 1 $/kWh. Nowadays the payments are up to 2.70 $/kWh.
Apart from voltage discrepancies, harmonics and flicker were also measured. In the
introduction stage from Sep 1996 - Sep 1998 the grid companies demonstrated to customers
that they been able to consider the solution for problems within a certain time. The grid
companies were also able to shut down interfered customers.
After a two year period, the grid companies have imposed a penalty payment concerning
guaranteed levels of harmonics and flicker. One guarantees disturbance levels in
accordance with international standards for different types of grids and different categories of
customer.
3.8 Power Quality Measurements
The standard for power quality measurement methods, IEC 61000-4-3010
, defines the
methods for the measurement and interpretation of results for power quality parameters in
10
IEC 61000-4-30 testing and measurement techniques – power quality measurements methods

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50/60 Hz a.c. power systems, and also gives guidelines for contractual applications of power
quality measurements.
According to IEC 61000-4-30, a power quality contract should specify:
• The power quality standard or specification in which achievable and acceptable limits
are defined.
• Events that are not a part of the contract, such as exceptional weather conditions or
power shortages resulting from external events.
• Whether flagged data (in the case of a dip, peak or interruption, the other PQ
parameters are “flagged”) is excluded from the analysis when assessing the results
for contract compliance.
• Which party performs the measurement; this could be a third party.
• How the financial cost of the measurement is to be borne by the parties concerned ,
this can depend upon the measurement results.
• The measurement time interval, minimum a week for voltage variations, unbalance,
harmonics and flicker, and minimum a year for dips and interruptions.
• The power quality parameters to be measured
• The electrical locations of the measuring instrument(s)
• The connection mode (phase-to-neutral or phase-to-phase)
• The measurement methods and the uncertainty
• The penalty payments if the power quality is not within the limits
• The duration of the contract.
The contract could also contain provisions for the resolution of disputes concerning the
interpretation of measurements and the subject of data access and confidentiality.
Class A (precise) measurement devices are required for contractual applications and
verifying compliance with standards. The measured power quality has to be compared with
the limits, this can be done in several ways:
• Counting the number, or percent, of values exceeding the contractual values
• Counting the number of consecutive values exceeding the contractual values
• Comparing the worst-case values with the contractual values
• Comparing the 95% (or other percentage) probability values with the contractual
values.

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3.9 Summary of power quality contracts
Most of the contracts initiated before regulation started as a contract between utility
companies and customers with sensitive process and high costs when there is a deficiency
in the electricity supply. An overview of the contracts discussed is given in Appendix A.
The Premium power quality contracts are not used by the large majority of consumers. Most
of the contracts concern reliability and voltage dips (events), however measurements are
made of other power quality aspects.
In most cases where contracts are used, the quality of the electricity supply has increased for
the customers with a premium power quality contract. Utility companies aim not to pay
penalties but to have incentives to decrease the number of interruptions and voltage dips.
One has to make sure that electricity companies will not only focus on improving the
availability or power quality for the customers with a premium power quality contract and
neglect the other majority of customers without a premium power quality contract; they do
need a basic level.
Relations between customers with a premium power quality contract and utility companies
are better since both parties have made agreements about the level of quality and
compensation (penalties) in case the quality is not met.
To measure the quality of supply, the installment of PQ monitoring devices is necessary; not
only during the contract, but also to measure the level before the Premium Power quality
contract starts.
Since each (group of) customers has its own sensitivity to power quality, the levels and
penalties agreed within the contract are different for each customer.
The quality of the T&D interface should also be established. As mentioned before, quality at
the PCC also depends on the quality of the transmission grids. Transmission companies,
who are responsible for the quality of the transmission grinds, should also commit to certain
levels of quality at the interface between T&D.

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4 POWER QUALITY LABELING
Most of the customers having a premium power quality contract are aware of the lack of
power quality in relation to their process. They are able to discuss with utility companies the
consequences of the lack of power quality and most of them are knowledgeable about power
quality. Since the majority of the customers does not have technical knowledge to discuss
the levels of acceptable power quality with utility companies, DNOs in the Netherlands have
initiated an easy classification system based on labeling the power quality11 12
.
When designing this classification format, the grid operators recognized that power quality is
not a subject with which many customers are familiar. This made it hard to communicate with
customers about the expected level of power quality and the consequences of lack of power
quality on the PCC. To communication to customers it is important that the classification is
kept simple and understandable. At the same time, the classification must be meaningful and
transparent and it must allow for the aggregation of large amounts of measured data into a
single measure of quality.
Most customers are familiar with the kind of classification that is already in use to classify the
energy efficiency of cars and household appliances such as washing machines. This “ABC”
classification uses letters to label the various levels of quality. The same format can be
adapted for voltage quality, as shown in Figure 4.1.
voltage
level
0.66
0.33
0.00
-0.33
-0.66
-1.00
1.00
A
B
D
C
E
F
dips flicker
very high quality
high quality
poor quality
normal quality
very poor quality
extremely poor quality
voltage
level
0.66
0.33
0.00
-0.33
-0.66
-1.00
1.00
A
B
D
C
E
F
dips flicker
very high quality
high quality
poor quality
normal quality
very poor quality
Figure 4.1 Classification of power quality characteristics
11
Prego 2 Onderscheidend vermogen (in Dutch); KEMA 2003
12
Prego 21 dip(lomatiek) (in Dutch); KEMA 2004

30620162-Consulting 07-0401
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One can debate whether -1 should be used as a limit for classification. In theory it is possible
for the value to be lower than -1. Choosing an exact border for classification F is not
necessary. The first step forwards defining a classification system of this kind is to normalize
all power quality characteristics. For each characteristic we can calculate the normalized
power quality level using the equation:
)(
),,(
),,( 1
q
pqv
pqv
l
m
r −=
where
),,( pqvr = The normalized power quality characteristic q, at site v, for phase p
),,( pqvm = The actual level of characteristic q, at site v, for phase p
)(ql = The compatibility level of characteristic q
When there is no disturbance, the normalized value will be 1 (m=0). If the disturbance level is
right on the limit specified by the applicable standard, the normalized value will be zero. If the
disturbance level exceeds the specified limit, the performance index r becomes negative.
The range from “no disturbance” to a level of “twice the acceptable disturbance” is divided
into six areas from very high quality (A) to extremely poor quality (F). This methodology is
flexible and boundaries can be estimated separately for each country.
We will discuss methods for describing the quality levels for the supply voltage. The following
quality aspects are distinguished:
• voltage variations
• voltage flicker
• harmonics
• voltage dips.
The voltage variations, the flicker level and harmonics are continuous phenomena, in
contrast with voltage dips, which are short-duration events. The quality levels are described
by using a PQ classification format. This classification should make it clear whether a PQ
standard is met or not, but should also express the relative performance for each specific
aspect of power quality. Most of this chapter is based on the power quality classification13
paper.
13
Classification methodology for Power quality, Continuon & KEMA, www.leonardo-energy.org

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For each power quality aspect a technical classification model is made, based on technical
standards. In the chapter on voltage dips we have extended this with a model that also takes
into account the costs of damage due to a lack of power quality. A similar extension can also
be made for the other power quality aspects.
4.1 Flicker
For the flicker level, as well as for the voltage variations and harmonics, the Dutch regulator
uses a percentile and level as a limit for the measured average values. For the ten-minute
average flicker level (Plt), this means a maximum value of 1.0 for 95% of all measured
samples, and a maximum value of 5.0 for 100% of all measured samples.
The compatibility level for the flicker is thus defined in terms of the 95th
percentile being lower
than a certain value. This type of compatibility level can be defined for all continuous
phenomena, such as flicker, voltage variations, harmonics, etc. These power quality
phenomena can be classified accurately using the percentile method. This method is
explained below by reference to the specimen flicker measurement illustrated in Figure 4.2.
The graph traces data measured over a one-week period at a PCC, showing 7*24*6=1008
ten-minute average values.
Figure 4.2 Ten-minute average flicker measurements at a PCC
By sorting the measured values, as shown in Figure 4.3, the 95th
percentile value can be
established. In the illustrated case, the 95% flicker level works out at 0.48.

30620162-Consulting 07-0401
-32-
Figure 4.3 Sorted flicker level data
Normalizing this flicker level by the standard of 1.0, for this PCC this leads to a value of
( ) 52.0
1
48.0
1,, =−=pqvr
This corresponds to a “B” classification (high quality). This leads to the classification system
illustrated in Figure 4.4.
A
B
D
C
E
F
very high quality
high quality
poor quality
normal quality
very poor quality
95 % percentile flicker level
0.66
0.33
0.00
-0.33
-0.66
-1.00
1.00
A
B
D
C
E
F
very high quality
high quality
poor quality
normal quality
very poor quality
95 % percentile flicker level
0.66
0.33
0.00
-0.33
-0.66
-1.00
1.00
Figure 4.4 Flicker classification
For checking the quality against the standard, as set by the regulator in most cases, the
percentile method is straightforward and accurate. One disadvantage of this classification
method is however that the end results does not give a lot of information about the actual
flicker levels. Figure 4.5 shows two very different distribution patterns, which nevertheless
yield the same 95th
percentile value; the distribution on the left correlates to much better
flicker performance than the one on the right.

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Figure 4.5 Two different distributions of flicker values
Grid operators need good general information about power quality levels, so a 95th
percentile
value does not on its own satisfy their needs. This problem can be addressed by using a
performance indicator that gives more information than the percentile method alone.
4.2 Harmonics
Harmonics and flicker are both continuously phenomena and based on a percentile. The
main difference between harmonics and flicker is that harmonics have several levels for each
harmonic number and the THD level. For each individual harmonics order and for the THD
level the classification can be established using the same equation as used for flicker.
However this would mean that there is not one classification but several (for each harmonic
and for the THD). Therefore the worst classification letter is proposed to be taken as
classification for harmonics.
4.3 Voltage variations
Depending on the demand level, network power flows and voltage control devices, the
voltage level at the PCC will change from minute to minute and from hour to hour. The
European Standard and the Dutch regulator define the compatibility level for the supply
voltage as 230 ± 10% volts, i.e. from 207 to 253 volts. More precisely, the standard states
that 95% of all ten-minute measured values for the average RMS voltage over a period of
one week shall be 230 ± 10% volts, and 100% of those ten-minute measured values shall be
within the range 230 – 15% to 230 + 10% volts.
Slow variations in the supply voltage can be classified by the STAV (Standard Deviation,
Average Value) classification method. This method provides more information about the
actual voltage deviations than may be obtained by a percentile method. The STAV method is
explained below by reference to the example illustrated in Figure 4.6, which shows measured
ten-minute average voltage values at a PCC over a one-week period.

30620162-Consulting 07-0401
-34-
Figure 4.6 Voltage measured at a randomly chosen PCC
From these measurements, the average value and the standard deviation are calculated as:
V3.2251
==
∑=
n
v
U
n
i
i
m and
1
)(
1
2
−
−
=
∑=
n
Uv
n
i
mi
σ =2.43 V
Assuming the voltage to be normally distributed, a classification method based on the same
principles as the percentile method can be used. Figure 4.7 shows the histogram and the
probability function for the measurements in Figure 4.6. Figure 4.7 shows the best-fit normal
distribution, from which it is clear that the measured voltage can indeed be modelled as a
normal distribution.

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Figure 4.7 Comparing measured distribution with normal distribution
In order to create a classification, the boundary between the C and D classifications has to
be defined. For this, the limits given by the Dutch national regulator are taken.
By way of further explanation of the STAV classification method, two different measured
voltage distributions are shown in Figure 4.8. This figure also shows the ±10% voltage limits
specified by the national standard. The upper limit may not be exceeded, and no more than
5% of all measured values may fall below the lower limit.
Figure 4.8 Different low voltage level distributions

30620162-Consulting 07-0401
-36-
Assuming a normally distributed supply voltage, we can calculate the probability of the
voltage straying outside these limits. For the upper limit, the requirement of 100% is softened
to 99.9% for practical reasons. This results in
{ } %9,99
253
=





 −
≤=





 −
≤=≤
σσ
mm U
YP
Ux
YPxXP
By using a statistical table for the normal distribution, we find that where the relationship
between the average and the standard deviation is concerned,
1.3
253
<
−
σ
mU
We can do the same for the lower limit:
%5
207
}{ =





 −
≤=





 −
≤=≤
σσ
mm U
YP
Ux
YPxXP
Hence:
65.1
207
−>
−
σ
mU
For both the upper and the lower voltage limit, the relationship between the average and the
standard deviation can be drawn as lines in the (Um , σ) plane. This is shown in figure 4.9.
Figure 4.9 Limits for the average voltage and standard deviation in the (Um , σ) plane
For supply voltage measurement, we can calculate the average and the standard deviation
and locate the resulting value as a single point on the (Um , σ) plane. This point must lie
within the triangle bounded by the upper and lower limits in order to comply with the national
standard. This means that with an average supply voltage around the nominal voltage of
230 volts, a larger standard deviation is allowed than with an average voltage that is offset
from the nominal value. This is because a high voltage with a large standard deviation gives

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a risk of exceeding the upper voltage limit, and a low voltage with a large standard deviation
gives a risk of falling beneath the lower limit.
Better performance is achieved when the voltage is more likely to be around the nominal
value. By using the same excess risk values – 99.9% for the upper limit and 5% for the lower
limit – and by proportionally reducing the permitted voltage limits, boundaries can be defined
for the other “ABC” classification categories.
Where the upper voltage boundaries are concerned, this means that
V3.26823*3/2253
V726023*3/1253
V0.253233/0253
V324523*3/1253
V7237233/2253
)230253(*253
230253
253
230253
230
11
/
/
/
/
/
=+=
=+=
=−=
=−=
=−=
−−=⇒
−
−
=
−
−
−=−=
fe
ea
dc
cb
ba
mm
U
.U
*U
.U
.*U
rUm
UU
l
m
r
while, where the lower voltage is concerned,
V7.19123*3/2207
V3.19923*3/1207
V0.207233/0207
V7.21423*3/1207
V3.222233/2207
)230207(*207
230207
207
230207
230
11
/
/
/
/
/
=−=
=−=
=+=
=+=
=+=
−−=⇒
−
−
=
−
−
−=−=
fe
ea
dc
cb
ba
mm
U
U
*U
U
*U
rUm
UU
l
m
r
Combining these limits results in a set of triangular areas on the (Um , σ) plane, as depicted in
Figure 4.10.

30620162-Consulting 07-0401
-38-
Figure 4.10 Low voltage level classification
From data on the supply voltage over the course of a week, the average and standard
deviation can be calculated and plotted as a single point on the (Um , σ) plane. The
corresponding classification can then be read from the figure. By plotting various
measurements in this way, trends can be made visible or the relative performance of various
locations can be compared. This is a very illuminating way of presenting slow voltage
variations as a characteristic of power quality.
4.4 Voltage dips
Voltage dips are receiving more and more attention as a characteristic of power quality
because it is now apparent that the annual socio-economic costs attributable to them are
comparable to those attributable to power interruptions. One problem with dips is that it is not
possible to measure performance over a short period of time. Only by monitoring over a
period of years can one describe the level of dip performance in quantitative terms.
The compatibility level for voltage dips is defined by tolerance curves, such as the ITI curve
depicted in Figure 4.11. This figure shows three areas. In area 1, electric devices should be
able to function according to specification. When the duration of the dip becomes too long,
and the residual voltage too low (area 2), or too high (area 3), electric devices are likely to
malfunction.

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0
100
200
300
400
500
600
1 ms 10 ms 0.1 s 1s 10 s
duration
remainingvoltage[%]
1 2
3
0
100
200
300
400
500
600
1 ms 10 ms 0.1 s 1s 10 s
duration
remainingvoltage[%]
1 2
3
Figure 4.11 ITI dip tolerance curve
It is possible to define a compatibility level as the annual maximum number of dips in area 2.
This number of dips is known as the SARFIITI dip performance indicator, but other dip
performance indicators can be used in the same way. The problem is, however, that different
devices have different tolerance curves, and the ITI curve was not designed to fit all
industrial, commercial or domestic customers. The basic problem with most dip performance
indicators is that they do not directly relate to the problems that are caused by dips. Long
shallow dips or short deep dips are very different in their effects on equipment and in their
causes and possible mitigations. A good dip classification method should account for these
differences in a meaningful and transparent way.
The basis for such a classification is found in the voltage dip table, which is a convenient
format for reporting measured or simulated voltage dips. The dips table shows the annual
average number of dips of certain depth and duration. The voltage dip table can be divided
into different dip types and regions. Nine dip types and three regions are distinguished in
Figure 4.12. Each region represents an area of responsibility.

30620162-Consulting 07-0401
-40-
100
90
80
70
60
50
30
40
20
10
0
500 ms. 10 s. 5 min.
K0
K1
K2
M0
M1
M2
L0
L1
L2
dip duration
remainingvoltage[%]
20 ms.
100
90
80
70
60
50
30
40
20
10
0
500 ms. 10 s. 5 min.
K0
K1
K2
M0
M1
M2
L0
L1
L2
dip duration
remainingvoltage[%]
20 ms.
Figure 4.12 dip types
The upper region, with the dip types K0, M0 and L0, depicts the area where it becomes very
hard for network companies to reduce the voltage dips further. The equipment manufacturers
therefore have to design their products to withstand these types of dip. The bottom region of
K2, M2 and L2 depicts the area where customers cannot be expected to install equipment
that is able to ride through dips of the types in question. In most cases it is therefore the
responsibility of the network company to minimize the number of these dips. The mid-region
of K1, M1 and L1 depicts the area where a balance has to be found between the customer’s
willingness to pay, the network investment required, risk financing cost, etc. Similar to
harmonics one can establish for each region the label (A up to F); the worst performance
region determines the total classification label. Another way to establish the label is by taking
the costs of voltage dips into account and establish the label based on those costs.
Each dip type requires a different approach. A power quality standard along the lines of
NRS 048 is best suited to addressing the differences involved. This method of dip standard
definition is based on setting limits for each dip type separately. These limits are based on
the estimated costs associated with each type of dip. These costs can be reported in a dip
cost table, such as the one on the right of Figure 4.13. The higher the costs, the fewer dips
can be allowed. This leads to a dip compatibility table that is inversely proportional to the dip
cost table. Figure 4.13 shows, on the left side, a compatibility table that is more or less
inversely proportional to the cost table, but not exactly. This is because the capital cost of
reducing the number of dips has to be taken into account as well when establishing a dip
compatibility table.

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-
8
4
-
4
2
-
2
1
-
1.7
5.2
-
3.4
10.3
-
6.9
17.2
= 1.0⊗
* 0.01
-
8
4
-
4
2
-
2
1
-
1.7
5.2
-
3.4
10.3
-
6.9
17.2
= 1.0⊗
* 0.01
Figure 4.13 A dip compatibility table (left) multiplied by a dip cost table (right)
The example in Figure 4.13 shows a compatibility table where a customer may experience
only eight dips per year of type K1, four of types K2 and M1, two of types M2 and L1, and
one of type L2. This dip compatibility table is clear and easy to understand. No limits are set
for dip types K0, M0 and L0 as equipment is expected to be compatible with dips of these
types.
From the compatibility table and the dip cost table, the value for the CARCI index (Customer
Average RMS voltage variation Cost Index) is obtained by multiplying the values per dip type
and adding the results. The CARCI index expresses the total expected annual costs due to
all types of voltage dip. The dip cost table can be normalized to get a CARCI value of 1.0 for
the compatibility table.
In order to classify measured voltage dips, one must first create a dip table by calculating the
annual average number of dips of each type. This dip table is then multiplied by the dip costs
table to get the CARCI value. The CARCI value is used as the normalized level of power
quality. The range from “no disturbance” to a level of “twice the acceptable disturbance” is
again divided into six areas from very high quality (A) to extremely poor quality (F), as shown
in Figure 4.14.

30620162-Consulting 07-0401
-42-
A
B
D
C
E
F
very high quality
high quality
poor quality
normal quality
very poor quality
CARCI
0.66
0.33
0.00
-0.33
-0.66
-1.00
1.00
A
B
D
C
E
F
very high quality
high quality
poor quality
normal quality
very poor quality
CARCI
0.66
0.33
0.00
-0.33
-0.66
-1.00
1.00
Figure 4.14 Classification of dip tables
This method of classification can be tailored to suit specific groups of customers or specific
network areas by adjusting the dip cost table. The dip table offers valuable information to the
network planner but can also be used by any (industrial) customer with its own, “personal”
cost table. In that case, the customer can calculate its own CARCI value and use the
average annual costs for ranking investment options. Questions such as “What would we
gain by making this equipment less vulnerable to dips of this type?” can be answered using
this method.
Because the annual number of dips can be quite low in some countries, it may be necessary
to use a sliding average for the annual number of voltage dips over a period of five years or
more. Otherwise, the classification may jump categories from year to year, which would
undermine the trust that customers and network planners have in this performance indicator.

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5 CONCLUSIONS
Voltage or power quality is an important aspect of the electricity service. Customers are
becoming increasingly sensitive to disturbances in power quality. In order to avoid the high
cost of equipment failures, all customers have to make sure that they obtain an electricity
supply of satisfactory quality, and that their electrical equipment is capable of functioning as
required when small disturbances occur. This can only be guaranteed if the limits within
which power quality may vary are specified and complied with by the network operator.
These limits can be defined by standards, by the national and international standards, in grid
codes and distribution codes, by the customer in a power quality contract, by a manufacturer
in a device manual or by the grid operator in an operating guideline.
In some countries, grid companies and (groups of) customers did have premium power
quality contracts before regulation started. Most of these contracts were for large industries,
no premium power quality contracts were known for the majority of the customers
(residential). There are some utility companies where residential customers can have
reliability contracts. Electricity companies can prevent overloading by switching off
customers’ equipment. In return, customers to pay less for electricity. However, these
contracts do not deal with power quality. Within this report we have focused on power quality
contracts.
Based on the findings in this report we conclude that premium power quality contracts are
attractive for customers with sensitive processes. Most of the contracts so far deal with the
number of interruptions and voltage dips. In case levels are not met, the electricity company
has to pay a penalty to the customer as a compensation for the time he could not produce.
There is a better common understanding for utility companies and customers when they
have agreed on a premium power quality contract. Results have shown that in most cases
the quality of supply increased with a power quality contract. Utility companies are not driven
to pay the penalty but to increase the quality.
In Italy, the regulator has addressed the possibility of a premium power quality contract. So
far no contract has been agreed between customers and utility companies. Why is the power
quality contract not successful in Italy while in other countries it is? This question is hard to
answer, but one has to recognize that there should be a consumer need for a premium
power quality contract. Nevertheless, regulators support the possibility of premium power
quality for groups of customers.

30620162-Consulting 07-0401
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On the other hand, regulators should not forget the majority of the customers, who do not
have a premium power quality contract. This means that power quality needs to be
regulated. One way of regulating power quality is using minimum standards. For other
methodologies, refer to our WP4/5 report14
for other power quality regulation methodologies.
For those customers who are not knowledgeable about power quality (the majority), utility
companies can use an easy classification system. Utility companies can provide contracts
with e.g. a B classification meaning a X% better power quality supply compared to the
minimum or average level. This make sure that customers do not need to have any
knowledge about all power quality aspects. Communication between customers and utility
companies can be easy without too much technical information.
If premium power quality contracts or classification systems are used, a monitoring program
is needed. Not only to monitor the power quality at the time during the contract, but also
before the contract was agreed. For events like voltage dips or interruptions, this take several
years before contracts can be agreed.
Based on the experience from some countries with power quality contracts, it has been
stated that:
- technical standards (like IEC, IEEE) are not a suitable basis for managing the number
of dips and interruptions, as these cannot be appropriately defined in a those standards
to the satisfaction of all stakeholders
- historical performance needs to be taken into consideration in the context of
contractual commitments to customers
- a formal quality management system that defines the roles of all stakeholders (utility
company, customer, equipment supplier and regulator) may provide an improved
management foundation
- managing T&D interfaces through specific agreements between DNO and TSO about
the power quality levels. The DNO cannot always be fully responsible for the power
quality supplied at the point of supply. Any lack of power quality originating in the
transmission grid could affect the power quality at the point of supply. This means that
DNOs should know what part of power quality is caused in their grids (or their
customers) and what part originates in the TSOs grid.
Within the Netherlands, grid operators have initiated a classification model for power quality
based on the minimum levels provided by the regulator. This classification model is used to
communicate with customers not knowledgeable about power quality. This so-called “ABC”
14
Regulation on Voltage Quality WP 4/5; KEMA 2007

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classification system is easy for customers to understand. To establish the limits between the
ABC levels; Dutch grid operators started an R&D program to investigate what the impact is of
the power quality initiated by the customers.

30620162-Consulting07-0401
-46-
APPENDIXASummaryofpowerqualitycontracts
Benchmarking
against own network Yes Yes Yes Yes Yes Yes Yes Yes
against regional level Yes Yes Yes Yes Yes Yes Yes Yes
against national level Yes Yes Yes Yes Yes Yes Yes Yes
methodology Own EPRI RBM EPRI RBM EPRI RBM EPRI RBM EPRI RBM EPRI RBM Own
Index Interuptions, dips Interuptions, dips Interuptions, dips Interuptions, dips Interuptions, dips Interuptions, dips Interuptions, dips Interruptions
Measurement
Systematic Yes Yes when necessary when necessary when necessary Continuous when necessary Yes
Ad hoc No No No No No No No No
interruptions, at PCC Yes Yes Yes Yes Yes Yes Yes Yes
interruptions, at customer Emeraude On request Acc. to agreement SMC Acc. to agreement Acc. to agreement Acc. to agreement Acc. to agreement No
Voltage dips Emeraude NRS 048 Acc. to agreement SMC Yes Yes Yes Yes No
Harmonics EN / IEC Yes IEEE IEEE IEEE IEEE IEEE IEC
Flicker IEC IEC IEEE IEEE IEEE IEEE IEEE IEC
Guarantees
Restore time Yes Yes Yes Yes Yes Yes Yes Yes
number of interruptions Yes Yes Yes Yes Yes Yes Yes Yes
number of voltage dips Yes Yes Yes Yes Yes Yes Yes No
Acc. tot PQ standard No NRS 048 No No No No No No
Acc. tot PQ agreement Emeraude Yes SMC Yes Yes Yes Yes No
Edenor m. Fl.
(Argentina)
San Diego Gas &
Electric
(California)
Duke Energy
(N. Carolina)
United Illuminating
(Connecticut)
Public Service
Electric & Gas
(New Jersey)
Quality assurance of
electricity deliveries
EDF
(France)
Escom
(South Africa)
Detroit Edison (Michigan)

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