Franco Podio, Gilfredo Cavagnolo and Enrico Maria Cipriano
November 13, 2012
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For the purpose of evaluating the cost of new machines with existing embedded parts in civil structures, it is necessary to introduce coefficient Kconf that considers the relative cost of the cast iron components compared to the whole ex novo supply. These coefficients, identified by analyzing the price composition of some supplies, can be estimated as 0.8 for Francis, 0.6 for Kaplan, 1 for horizontal Pelton and 0.85 to 0.9 for vertical Pelton units.
Similar considerations can be found in other literature.8
Curves of the weight for unit power for transformers were inferred from catalogues and purchase orders. With a reference,9 ENEL can deduce analogous curves of the cost by unit power.
Taking as a reference the voltage level of 132 kV for oil transformers having an oil natural air natural (ONAN) cooling system, the curve of the cost in function of the power will have an exponent of 0.56. If the cost of some of ENEL's recent years' supplies are displayed on a diagram, the pattern is substantially confirmed.
It is necessary, particularly for the transformers, to underline that the price is very sensitive to the capitalization losses established in a tender. In fact, diagramming the price of several purchase orders including the capitalization losses, ENEL finds that the regression coefficient is close to 1. Further investigations have confirmed the transfer criteria published elsewhere9 both for the high-voltage transfer level and for different cooling systems.
The simplified model for three levels for the step-up transformers shows:
220-230 kV, Tr = K x An0.45
132-150 kV, Tr = 0.86 x K x An0.56
15-20 kV, Tr = 0.74 x Kx An0.74
Secondary parameters include voltage level, cooling system, insulation level, short circuit voltage and losses.
Overhead cranes
The two parameters to estimate the cost of an overhead powerhouse crane are the capacity and span. From an analysis of the data coming from new supplies of powerhouse cranes carried out in recent years (22 supplies) and with a span varying from 7 meters to 20 meters, ENEL demonstrated that the parameter span in a simple model can be disregarded.
Among the secondary parameters that can affect the costs are, besides the span, lifting head, specification of test standard and operating mode. The cost of a gantry crane can be estimated from the cost of the overhead crane by adding the cost of the metallic structure of the stand.
Diesel generator
To find a simple model, ENEL referred to manufacturer price lists. The fundamental parameter is the apparent power and whether a soundproof enclosure is supplied. The quadratic model becomes linear for a diesel generator set with a limited power. Among the secondary parameters are the speed and typology of the diesel motor.
Turbine and generator cooling system
Cost of the cooling system of the turbine and generator unit in a closed circuit with water-water heat exchangers placed in the downstream channel, with oil-water heat exchangers for the bearings and air-water heat exchangers for the generator, can be expressed as a function of the power of the unit or of the cooling system nominal flow.
The second case is applied only when it is possible or when a preliminary project of the plant has already been done.
Among the secondary parameters that can cause a variation in costs are the materials used (e.g., carbon steel or stainless steel), length of the circuit, and difference of the temperature between the inlet and outlet.
Rectifiers and batteries
To evaluate the cost of rectifiers and batteries, ENEL assumes the rated current as a fundamental parameter. The direct current system of ENEL's power plants has a rated voltage of 110 V. It is evident that the cost is very sensitive to the variation of the cost of the raw materials, and over recent years this has seen a remarkable price increase.
Cast resin transformers
For transformers dedicated to the auxiliary service (insulated cast resin transformers), the fundamental parameter to evaluate the cost is power. For this equipment, the linear relationship obtained for small power is not valid for higher power.
It is possible to verify that the variation of the weight and of the price in function of the power are analogous, in a relationship having 0.66 as the exponent of the power.
The weight variation and consequently the cost variation is also a function of the voltage level (see Figure 5).

Among the secondary parameters that can contribute to a different cost are voltage level and short circuit voltage.
Hydraulic and civil works
The more complex aspect of the hydroelectric plant evaluation is estimating the civil works component. The latest modifications to the Italian fiscal policy caused a significant increase in the taxable real property value that now involves all plant components including the hydraulic works. For this reason, ENEL has established a procedure whereby there is a comparison of historical data available and comparisons between plants built in the past and those recently built or those being built, in order to evaluate the rebuilding cost. This has been created by establishing homogeneous and objective criteria to assess the costs, useful life of the works and consequent degradation due to ageing.
This article presents the initial results of this standardization study. In other countries, new taxation systems are being analyzed that could be fairer, be simpler and incentivize a better use of resources. This could push energy production companies to invest in renewable energy sources in a rational way, by managing the various requests of the system more efficiently, especially in the areas of energy production, tariff, incentives, various use of resources, and increases in ecologic emissions.

Figure 6 shows the cost of civil works related to replacement of a horizontal Pelton turbine. The parameters considered for construction costs and residual value estimation are:
— Dam: type and volume;
— Tunnels: type and section area;
— Galleries: type and section area;
— Penstocks: type and weight
— Turbines: type, speed and power;
— Generators: type, speed and power.
Consider a statistical evaluation concerning 39 dams and works in roller-compacted concrete with volume greater than 30,000 m3 for more than 6.3 million overall, with an average value in 2000 of €33.6/m3 and a range of variability between €14.3 and €66.0 /m3.10
The resulting component life and residual value is:
— Turbine: 45 years, 5% to 10%;
— Generator: 45 years, 5% to 10%;
— Automation system: 15 years, 0%;
— Auxiliary systems: 40 years, 5% to 10%;
— Dam: 90 years, 5% to 10%; and
— Penstock and hydraulic works: 65 years, 5% to 10%.
We have presented a methodology and a tool for carrying out cost estimates for hydroelectric plant components. This tool does not intend to establish a specific price which, as said before, is determined by market rules and tender strategies and methods.
The cost estimates remain a valuable guide for carrying out the assessment needed for the investment analysis and for the patrimonial evaluation of the goods present in a plant and inherent taxation implications.
Franco Podio is electromechanical engineering technical manager, Gilfredo Cavagnolo is hydro development technical manager, and Enrico Maria Cipriano is real estate technical manager with ENEL SpA.
1. Erbiste, P.C., "Estimating Gate Weights," International Water Power & Dam Construction,
2. Castelli, B., O. Hartman, and L. Ravicini, "Cost and Economics of Hydroplant Modernisation," International Water Power & Dam Construction,
3. "Dimensionamento Preliminare del Macchinario Idraulico per Impianti Idroelettrici," Servizio Macchinario Idraulico, Rome, Italy, 1980.
4. Gordon, J.L., "Estimating Hydro Power-house Crane Capacity," International Water Power & Dam Construction,
5. "Diretrizes Para Projetos de PCH," Eletrobras, www.eletrobras.gov.br.
6. Novos Empreendimentos: Proposta de Orçamentação de Hidrogeradores, Eletrosul, XIV SNPTEE, 1995.
7. Malquori, E., "Relazione Generale Sullo Stato dell'Arte delle Turbine," Congresso Nazionale Macchine e apparecchiature idrauliche - Memoria esposta da C. Reynaud (ENEL) al convegno di Baveno - maggio 1993.
8. Hydro Life Extension Modernization Guides - Vol. 2: Hydromechanical Equipment, EPRI, Palo Alto, Calif., USA, 2000.
9. Electrical Transmission and Distribution Reference Book, Westinghouse, 1950.
10. www.cement.org.
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