In the current scenario where India is facing acute power shortage and setting up greenfield plants involves large investment and long gestation period, maintenance, renovation and modernisation of the existing power plants is considered the best option.
In the last five years, the demand for power has been increasing at a compounded annual growth rate of 8 per cent in India but the supply has not kept pace. As a result, large parts of the country are experiencing daily power outage of around 30,000 MW for various reasons including breakdown of old units.
Though setting up new plants to meet the rising demand is one solution, the costs and the long time span involved prove to be major deterrents. Installing one MW of fresh generating capacity through greenfield projects reportedly entails a capital expenditure of around $1 million whereas an equivalent capacity addition can be achieved by investing almost one-third of that amount in renovation and modernisation of power plants. Apart from being low capital intensive, they do not require environmental clearances, thus reducing the time frame considerably. Hence R&M and proper maintenance of power plants operating below the rated standards is being touted as the next best option by industry experts. In fact this was reiterated by many industry professionals and experts at the 'Safe Future Now' summit organised by S_D, the German testing, inspection and certification company and Central Bureau of Irrigation and Power (CBIP) in October in Delhi.
"Majority (of) power plants being coal fired in India and with recent data suggesting that quite a few are nearing the end of their life-cycles, there is an urgent need for renovation and modernisation in order to optimise power generation efficiency, adopt best technology and improve environmental impacts to ensure a more viable and sustainable future," says MVK Rama Rao, Managing Director of Haryana Power Generation Corporation Limited who was the Chief Guest at the summit which focused on 'Optimising performance of Thermal Power Plants for a sustainable and safe future'
The Report of The Working Group on Power for the Twelfth Plan (2012-17) has also emphasised on maximising power generation through renovation, maintenance and modernisation. "Optimisation of generation from the existing generation capacity is of utmost importance in the resource crunch environment. The installation of new power projects involves large investment and long gestation period. Therefore, following options are recommended for maximising generation from existing projects : Renovation & Modernisation of power plants, Energy Audits and Better Operation and Maintenance practices," says the report.
The government and Central Electricity Authority (CEA), India's apex planning body for the power sector, have already begun to focus on these activities. Various policy documents such as National Electricity Policy, Integrated Energy Policy etc., provide a broad framework which lays emphasis on integrating energy efficiency in the future through R&M programmes.
In fact CEA is planning to invest Rs 20,000 crore in R&M during the 12th Five-Year Plan.
"From April 2009 onwards, CERC tariff regulations started giving revised provisions for mid-life and post 25 year R&M of coal stations and R&M of gas stations after 15 years. These revisions will have far reaching impact on the R&M investment decisions to be taken by the generator," pointed out V Ramesh, Additional General Manager, NTPC Ltd at the 'Safe Future Now' summit.
The objectives behind maintenance, renovation, and modernisation is to improve the performance in terms of output, design modifications and minimising inefficiencies as also meeting safety requirements and environmental norms. Bratin Roy, Vice President -Industry Service TÜV SÜD South Asia, listed out the objectives in his presentation at the 'Safe Future Now' summit: " The objectives behind renovation & modernisation are to achieve rated output/higher than rated output, better availability of generating equipment, improved performance/efficiency and life extension of unit, facilitate adoption of improved operations and maintenance practices, improvement in emission levels from thermal power plants."
The opportunities for R&M services are huge considering the condition and age of existing power plants. Many of the old plants are operating on outdated technologies and reduced capacities.
Looking at the current scenario, some of the power plants set up recently have also begun to adopt comprehensive plant optimisation and maintenance solutions to reduce downtime and costs. Additionally, power plants under construction are also reportedly trying to put in place maintenance systems from day one of operation. So a wide range of opportunities have opened up for players in the R&M field. Many of them are also cashing in as revealed by Chacko: "In our experience, the private sector power equipment manufacturers are quite proactive in their approach towards R&M projects. The last decade has seen an increase in the number of players and they do look at R&M projects as a viable business opportunity. In particular some firms have pre-selected their contractors and sub-vendors even before being awarded projects in order to reduce time taken for resource mobilisation."
Besides generation improvement and life extension, other benefits achieved from R&M include improvement in availability, safety and reliability. Further, many of these plants are also plagued with uncontrolled emission discharge limits. R&M can also take care of this by introducing energy efficient practices and procedures. According to Roy, these measures can lead to a life extension of the plants by another 15 to 20 years, increase of rated capacity by 4 per cent to 8 per cent and increase of efficiency by 8 per cent to 10 per cent.
Seconds Abhijit Lohakarey, Senior Manager - Energy, Utilities & Mining, PwC India, "Faster increase in the generation capacity as compared to setting up of new power plants, life extension of units by 10 years or more, improved plant efficiency and consequent reduction in fuel consumption, better compliance with emission and emission norms are the advantages of R &M."
CK Chacko, Managing Director, Fitwell Construction Pvt Ltd lists out some more: "Renovation and maintenance can be termed as a means of 'evolutionary growth' in power capacity with lower capital expenditure for power producers when compared to erection of greenfield plants. The greater part of time, labour and capital is consumed in the erection of civil structures which can be avoided in renovation and maintenance. It may also be considered that the renovated power plants are less demanding of labour for routine operations and maintenance, which results in further savings for the power producing utility during the life of the components."
But maintenance, renovation and modernisation have not yet gained momentum as they should have. Many power companies both in the public and private sector do not follow a comprehensive and integrated R&M policy.
"Integrated solutions focus on operational and implementation synergies with due consideration of plant and market needs and demand, which often get missed in traditional component/equipment specific approach," says Roy, who feels that modern maintenance measures should include preventive and predictive maintenance condition-oriented maintenance, inspection planning, NDT program, monitoring methods calculation methods (e.g. fracture mechanics calculations) remaining life assessment repair/replacement of damaged components, etc.
Chacko on the other hand opines that R&M be made mandatory instead of leaving it to the owners of the plants as it is now. "It may be made mandatory for the owners to carry out renovation and maintenance without undue delay. Financial resources may be made available to the weaker utilities to carry out their programmes," he says.
Lohakarey suggests integrated measures to be taken by the government, power plants and other stakeholders: "There should be increased participation of various agencies such as consultants, OEMs, R&M agencies and funding agencies before the units reach the end of their design life. Setting up a dedicated R&M cell should be made mandatory (with required number of competent resources) at utilities and finalising the integrated R&M plan well in advance. Funding by financial institutions at concessional interest rates, tax incentives for adopting PPP model for implementation of R&M programmes and providing e-incentives for meeting R&M related performance guarantees and penalties for non-performance are the other steps to be taken," he elaborates.
No doubt maintenance, renovation and modernisation are the need of the hour. However, the renovation and modernisation solutions should be custom designed to suit each plant's deficiencies, operational impediments and problems, opine industry pundits.
- Janaki Krishnamoorthi
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