The Economic Evaluation Of Substations Based On Utility-LCC

Life Cycle Management (LCM) has achieved initial progress in the investment management of some new substations. It also plays an active role in substation renovation, equipments selection and bidding. Although, the application of LCM in substations is still in its infancy, it has made great achievements. However, reasonable control of the funding and maximizing enterprise value is not the only paramount consideration of Grid enterprises. Their first and foremost task is to ensure security of substation operation, which is related to the quality of the power supply. Both the economic and social benefits must been taken into account.On basis of the LCM application in substation, a comprehensive utility-cost (UC) analysis and evaluation system of the substation is established. UC system includes utility and life cycle cost (LCC) that reflect the social performance of the substation and the whole amount of investment.A substation’s utility mainly consists of the social blackouts loss, the degree of asset utilization, land of opportunity costs and environmental costs. Among them the introduction of land opportunity costs and environmental costs brings innovation and improvement to the utility system. The shadow cost of the land obtained from the opportunity cost of the land and the land leasing cost of LCC gives a reflection of the land’s real and potential value. As for the environmental costs, this article fully considers the substation electromagnetic radiation, radio interference:noise pollution and the greenhouse effect caused by SF6, and gives a calculation method to quantify the environmental impact of economic indicators.The substation LCC includes four parts of the initial cost, operation and maintenance costs, failure costs and decommissioning costs. On the basis of previous studies, this article gives more refined definition for these four costs and more specicific calculation methodology. Among them, the initial cost is taking into account not only the equipment cost, land leasing costs, but the introduction of innovative renovation costs and interest on loans. The interest in equal installments of principal and interest repayment formula is derived in this article. The proposed definitions with more delicate division help provide a more precise estimation of a long-term investment. With the finely divided and quantum chemical calculations, the company can make optimal decisions, and promote the companies to save costs and improve profits.Finally, this article used the typical design of a500kV substation as an example. The application of UC analysis and evaluation methods was elaborated to discuss the difference and respective advantage of gas insulated switch (GIS) substation and air insulated switchgear (AIS) substation in economic and utility performance. Then the evaluation of overall performance leads to corresponding conclusions. Finally, uncertainty analysis has been done for factors that might have an influence on the evaluation results of the program.