Some Issues on Supply-Side Management of electricity

1   What is Supply-Side Management (SSM)??

The SSM is widely known to take actions and to ensure the generation, transmission and distribution of electricity (energy generated from any sources) efficiently. For discussion, I assume, the “supply-side” is to include the following activities:

1.  Supply and utilization of energy resources: This should focus on per capita consumption fulfilling the energy needs and energy security of any country. Moreover, it will particularly focus on imported fuel substations.

2.  Power generation and energy conservations:  It not only focuses on the maximization of renewable power generation but also includes operational improvements in existing plants, distribution units and energy efficiency techniques as a whole.

3.  Transmission and distribution of electricity: It focuses on fulfilling energy transfer and supply scenario along with building smart transmission and distribution substations. 

4.  Storage of renewable resources and energy products: It aims to conserve the natural resources like water for dry season and production of hydrogen and ammonia gases for other applications, including Industrial and commercial purposes.

2  Why pursue SSM?

Electricity consumption is growing rapidly in the global scenario. The highest rates of growth have been observed in developing and transitional economies. For an improved system, an effective SSM will increase the efficiency of electricity use which the end-users are supplied with. This allows the utility companies to defer mobilizing major capital expenditure, which might otherwise be required for increasing their capacity in growing markets.

The SSM makes the installed production capacity able to provide electricity at lower cost (permitting lower prices be offered to consumers) and reduces emissions per unit out of the end-use electricity provided. The SSM can also contribute to improving the reliability of a supply system. With the ongoing trend of deregulating the supply industry, it is becoming more important to embark on supply-side management where the supplier, user and the environment all are benefited. The SSM requires data to conduct regular performance monitoring of existing power plants. It is an essential management activity to keep conversion efficiency at its highest.

Unfortunately, as I learnt, many plants do not carry out rigorous analysis of performance regularly. The typical energy efficiency of a modern, well-maintained thermal power plant is around 33 to 38 percent (Frans van Aart, 2004). However, the typical efficiency of the hydropower and renewable energy are well above 80 percent. Nepal, being rich in renewable energy resources, has vast opportunities to explore hydropower to meet the net zero emission (COP26 Goals).

Figure I, under the title of ‘dominant electricity supply resources,’ shows the breakdown of primary energy resources used worldwide for electricity generation.The contribution of other renewable energy in demand is approximately 1 percent, so with the case of Nepal too. 

Replacements of fossil fuel have been greater topics everywhere. Fuel substitution (or fuel switching) is simply substituting one fuel for another. Examples would be expanding the use of natural gas in industry, transport, domestic cooking and heating, and for electricity generation, rather than using liquid petroleum based plants. Although such actions refer to energy supplies, most in practice involve the energy user for implementation and thus could also be considered “demand-side management,” which is observed most of the times.

As a general rule, the combustion of natural gas is carried out much more efficiently than oil or coal, on a heating value basis. In industrial equipment, control of gas-fired equipment is usually much more precise and maintenance is easier to carry out (partly because there will normally be much lower levels of corrosive components in the exhaust gases). A similar situation applies to commercial and domestic furnaces and boilers. The increased efficiencies that are achievable will often result in useful cost reductions even where the “new” fuel is more expensive than the “old” fuel. Thus, fuel substitution can be regarded as a cost effective SSM measure.

An example of fuel substitution in energy supply in the transport sector is in Delhi, where 84,000 public vehicles were converted from using gasoline and diesel as the fuel source to compressed natural gas (CNG) in a period of one year. In other sectors too, the increased use of natural gas for electricity generation and public investment to develop the natural gas based infrastructure for long distance travel and local distribution is also promoting fuel switching mechanism. The share of gas in power generating capacity has risen from 2 percent to 8 percent over the past 10 years and the LPG has largely replaced coal and kerosene in urban households (UNFCCC/SBI/2003/INF.14, 20 November 2003).

Various aspects of resource utilization for the production of electricity are the basic planning model of SSM. The resources and resource planning offer the potential for cost effective efficiency improvements in elements of the supply chain and thus are classed as SSM options.

Have we thought about clean coal technologies (CCTs)? 

New technologies offer huge potential for using discarded coal. Improved efficiency in extracting energy from the coal delivers the same amount of electricity but with reduced gaseous emissions and solid waste.

There are many ways of using coal efficiently and neatly, depending on different coal types, different environmental issues and different levels of economic development. John Makens in "Upgrading Transmission Capacity for Wholesale Electric Power Trade" says, “Some CCTs require highly complex, expensive technology and infrastructure which therefore may not apply to all developing countries.” He added that CCTs can include a broad range of items, such as:

•   Coal cleaning: Processes used to increase the heating value and the quality of the coal by lowering the level of sulphur and non-combustible mineral constituents. These simple methods, almost always used in developed countries, are suitable for developing countries.

•   Emission reduction technologies: “Bolt on” or “end of pipe” technologies, including:

  -    Activated carbon injection to absorb pollutants.

  -    Electrostatic precipitators in which particulate/dust laden flue gases pass between collecting plates where an electrical field creates a charge on the particles. The particles are attracted towards the collecting plates, where they accumulate and are subsequently removed.
  -   Fabric filters to collect particulates by passing flue gas through tightly woven fabric. Wet particle scrubbers, in which water is sprayed into the flue gas stream as a fine mist of droplets. The fly ash particles impact with the droplets forming a wet byproduct, which is then removed for disposal.

  -   Flue gas desulphurization (FGD), the process by which sulphur emissions are removed post-combustion by wet scrubbers, by dry scrubbers, by sorbent injection processes, by regenerable processes, or combined SO2/NOx removal processes.

-    Selective catalytic reduction (SCR) and selective non-catalytic reduction (SNCR) in which steam is used as the reducing agent and is injected into the flue gas stream (passing over a catalyst in the SCR process).

•   “Next generation” technologies, such as underground coal gasification (UCG) where coal is converted in situ to combustible gas that can be used for power generation, thus eliminating a large portion of the supply chain normally associated with coal fired generation. The gasified coal can be treated to remove sulphur derivatives and particulates to ensure combustion is clean.”

Overall, CCTs improve the efficiency of coal-based electricity generation, with benefits such as

  -   Increased electrical power output per unit of coal fired.
  -   Reduced environmental impact per unit of coal fired, possibly in conjunction to removal of CO2 and SOx emissions. 
 

3   Transmission

The core area of supply-side management concerns transmission and distribution of electricity to customers. A reliable system depends on the reliability of the lines taking power from the generator to the end-users, and also includes step down substations, feeders and distribution transformers, among others. 

3.1   Transmission lines

Transmission lines carry electricity from one point to another point over long distances. The majorities of transmission systems operate with AC and are built over-ground. Its main difference from distribution lines is that most transmission lines operate at relatively high voltage (typically from about 66 to 765 kV). Underground transmission lines are much less common than over-ground.

Greater demands on most transmission systems require greater power transfer capacities. Even with adequate electricity generation, bottlenecks in transmission interfere with the reliable, efficient and affordable delivery of electric power. The amount of power on a transmission line is the product of current, voltage and “power factor”. There are three types of constraints that limit the capability of a transmission line, cable or transformer to carry power: thermal/current constraints, voltage constraints and system operating constraints (John Makens, 2006). The dynamic stability criteria assumed to operate the EHV AC lines is only 30-50 percent of its thermal/rated capacity which is a multiplication of the sending and receiving end voltages divided by total reactance of the line also multiplied by Sine of angle DELTA (rotor angle).

3.2    Data monitoring

To ensure that generation, transmission and distribution (electricity use) are all properly balanced and operated at the highest efficiency, it is necessary to have comprehensive information on all elements of the system. There are many computerized systems available to do this. These are collectively known as “supervisory control and data acquisition” systems (SCADA). Such SCADA systems can switch selected equipment on or off, based on the current situation of the utility company supply system. The SCADA systems can also be used to monitor and control buildings’ operations, operating heating, lights and cooling equipment as required. The SCADA systems also are used to switch large loads on or off to ensurea customer does not exceed an agreed maximum demand and thus pays extra for the electricity consumed.

While this control of large loads normally remains with the owner and operator of the equipment, it is possible to set up systems in which control of major loads rests with the utility company, allowing it to delay loads from the highest peak time to another—a more convenient—time. In many such cases, the reduction in peak load represents a shift to more efficient generation by the utility, and thus, is a useful supply-side management measure.

4.  Substation

A substation is used to switch generators, equipment, circuits or lines in and out of a system. It is also used to change AC voltages from one level to another, or to change AC to DC current (or vice-versa). Some substations are small with only one transformer; others can be quite large with several transformers and switchgears.

Distribution transformers are normally very efficient, with losses of less than 0.25 percent in the largest units. However, when the overall losses of many transformer steps in a distribution system are taken into account, the losses can add up. In addition, the load on transformers decreases when facilities close for the day or at the weekend: the no-load losses in lightly loaded units increase as a percentage.Transformer losses in power distribution networks can exceed 3 percent of the total electricity generated in conventional technological option.

The core loss (Iron Loss) can be optimized in less than 0.5 percent if the amorphous core technology is employed.The other technology is 3D transformers, which has less core loss and energy saving using the smart control system. The second loss is coil or load loss, termed because the efficiency losses occur in the primary and secondary coils of the transformer. Coil loss is a function ofthe resistance of the winding materials and varies with load.

5  Distribution

Distribution networks consist mainly of overhead lines, underground cables, transformers, and LV switchgear. Most consumers are supplied at low voltage, defined typically as less than 0.4 kV, with domestic customer supplies usually at 230 volts or less. 

Some of the larger commercial and industrial consumers are typically supplied at high voltage, over 11 kV, 33 kV and more. Electrical losses are an inevitable consequence of transferring of energy across electricity distribution networks. In the UK, the losses amounted to around 7 percent in 2000/2001. The level of losses varies from year to year, influenced by several factors, both technical and operational.

The International Energy Agency (IEA) publishes figures regularly for losses in transmission and distribution. While the numbers vary from year to year, typical figures for 1998-2001 are around 7 to 8 percent, with European Union figures averaging about 7 to 7.5 percent (although the range is from under 4 percent to over 10 percent). According to various World Bank/ESMAP reports, some countries report distribution losses as high as 30 percent of the energy supply.Much of these very high losses can often be attributed to theft with, say, half coming from technical losses. There are likely to be important opportunities for reducing losses by investigating the level of losses and where these occur in any distribution system.

5.1 Distribution system reinforcement and Upgrading 

It is essential to upgrade and reinforcement of distribution system for supply side management program. While there are many similarities in distribution networks, there can be important differences in geographical size, such as:

•    Number of customers connected.
•    Quantity of electricity distributed.
•    Degree of dispersion of customers across the network.
•    Proportion of different types of customers.
•    Amount of underground versus overhead lines.

There may also be wide differences in design, operating and investment principles, any of which can influence the network configuration. The level of losses in a network is driven by a number of factors. There are three main categories of losses; variable losses, fixed losses and non-technical losses:

•   Variable losses, often referred to as copper losses, occur mainly in lines and cables, and also in the copper parts of transformers. They vary according to the amount of electricity transmitted through the equipment and are proportional to the square of the current. Losses are also proportional to the length of line, the resistivity of the material, and inversely proportional to the cross-sectional area of conductors. Typically, variable losses are about two-thirds to three-quarters of the total losses (UK Office of Gas and Electricity Markets, 2003).

•   Fixed losses, or iron losses, occur mainly in transformer cores and do not vary according to current and/or load. These are typically a quarter to a third of total losses.

•   Non-technical losses, unlike the two items above, refer to electricity delivered and consumed but not registered as sales. This includes theft as well as simply errors in recording and billing (e.g. meter errors, lack of calibration, no meters installed).

Demand management is another means of reducing variable losses because loads transmitted at peak time result in greater increases in losses than the same amount at off-peak times. If distribution companies can encourage users to smooth out their demand, losses can be reduced.

Finally, variable losses can be reduced by balancing three-phase loads throughout the network on a regular basis. Fixed losses do not vary according to current. They take the form of heat and noise and occur so long as a transformer is energized. The level of fixed losses can be reduced by upgrading the core material of transformers (e.g. special steels and amorphous iron). They can also be reduced by eliminating transformer levels (reducing the number of transformers involved), and by switching off transformers in periods of low demand.Low power factors will also contribute to losses. Raising power factors by installing capacitors will lead to lower distribution losses, as can distributed on-site generation.

5.2    On-site generation

Strictly speaking, some might not consider on-site generation to be a true supply side management measure. On-site generation at an electricity user might be away from cutting the electricity supplied by the grid to zero, of course, and this would no doubt have an effect on the electricity supplier. The utility, in the absence of investment funds for increasing generating capacity, might wish to reduce the electricity it supplies to one customer to supply others, provided the original customer can self-generate all or part of its power needs.

The benefits of on-site generation can therefore be:

•   On-site “self-generation” reduces demand on the grid and may allow deferment of investment in additional capacity;

•   The principal electricity supply can be at the end-user itself, reducing transmission losses incurred in getting a supply from a distant power source.

The on-site generating equipment can use a variety of energy sources—from conventional fossil fuels to renewable energy such as solar, wind, bio-energy, etc. Systems may adopt conventional boiler-steam turbine technologies or can be installed as cogeneration plants (often worthwhile if an industrial plant has steady electricity and heat loads year-round, or has a low-cost source of energy available, such as waste heat from an industrial process). In some cases, the on-site generator can be connected to the grid, to import electricity if on-site electricity production is inadequate (“standby electricity”) or to export to the grid if excess electricity is available. The cost of standby power from the grid to satisfy imports, and the value given to surplus electricity exported to the grid, are subjects of negotiation between the parties. Technical standards will also have to be met, such as voltage levels and AC frequency.

5.3    Power factor improvement

Power factor is the ratio between the useful load (in KW) and the apparent load(in KVA) for a system. It is a measure of how effectively the current is being converted into useful work output and is an indicator of the impact of the load on the efficiency of the supply system. A load with a power factor of one result in the most efficient loading of the supply, while a load with power factor says 0.5 will cause much higher losses. Whenever loads are connected to an AC supply, there is a possibility that current and voltage will be out of phase. Loads such as induction motor draw current that lags voltage, while capacitive load (e.g. synchronous motors, battery chargers) draws current that leads voltage. Loads those are predominantly resistive, such as heaters and cookers draw current in phase with voltage. The angle between the current and voltage is known as the “phase angle ϕ”—this can be leading or lagging (or zero) depending on the load. The power factor is defined as cosine ϕ and is always less than one. It represents the ratio of active power (or useful power) to the total power supplied by the generating station.

Power factor correction is normally considered a key demand-side management option because it is usually implemented by the electricity customer and leads to a reduction in their electricity bills. However, it is a measure that reduces the power supplied by the utility and therefore it may also be considered a supply-side management option.

Indeed, utility companies often put in place incentives (or penalties) to encourage their customers to improve their power factor, in order to relieve load on their generators. When the power factor is less than unity, the amount of useful power supplied by the generating plant at maximum output will be less than its full capacity (in other words, not all the power supplied is turned into useful work). This results in inefficiency and, therefore, utility companies usually require customers to achieve a power factor of at least 0.9 (sometimes 0.95). Those who fail to meet the minimum will be charged a penalty on their bills to compensate for the various losses incurred by the generator (e.g. losses in distribution cables and transformers). Operating at a high power factor allows energy to be used more efficiently (hence, the setting of a limit, such as 0.9 or 0.95). Since most loads in practice are inductive, lower power factor can be increased (“corrected”) by installing capacitors in the system. In most plants, a practical solution is to install capacitor banks at the main point of power supply. Depending on the power factor, more or less capacitance can be connected at any time. Slightly more efficient, but costlier, is installing individual capacitors around a facility to correct the power factor in different parts of the network. In all cases, the utility company benefits because less power needs to be generated to meet the end use needs of customers with high power factors.

6   CONSTRAINTS AND CHALLENGESOF SSM

Utility companies may change the load profile to allow their least efficient generating equipment to be used as little as possible. They may improve maintenance and control of existing equipment, or upgrade equipment with new items utilizing improved technologies. In brief, an electrical utility may embark on SSM to:

-    Ensure reliable availability of energy at reduced generating cos.
-    Reduce energy prices to some or all of their customers.
-    Meet increasing electricity demand without incurring major capital investments until later.
-    Minimize environmental damage.

Suppliers of other types of energy will have corresponding motives.Energy users will normally focus their efforts on demand-side management methods (DSM) but some will consider the supply side too. For example, they may look at on-site generation alternatives

—including cogeneration—or consider diversifying to alternative fuel sources (such as natural gas, solar, wind, bio-fuels, etc.).

One of the challenges in adopting SSM is the need for comprehensive information to be widely available to utility staff—including operating, technical and commercial departments

—about measures that could be appropriate to their specific situation. In some cases (e.g. power factor correction) it will be the primary responsibility of customers to take the relevant measures and make the necessary investments, so that the efficiency of overall supply can benefit. Balancing the interests of the supplier and consumer may sometimes prove difficult, especially when capital investment gets involved. Investors will need incentives of some sort to be persuaded to take action, and these incentives will normally be in terms of improved profits and rarely in terms of environmental improvements.

Even where SSM can typically produce economic benefits to the utility or indeed the customer, there will often remain a problem of convincing company management to authorize expenditures. Sometimes a short-term approach is used and the evaluation of a project requiring a significant investment may fail to take into account long-term benefits and life cycle costing. All too often a “first cost” basis drives decisions: this frequently results from a lack of capital funds.

Regarding the efficient operation of existing facilities, it is often the lack of management that leads to poor energy performance, and not the lack of tried and tested equipment and processes. Senior managers all too often fail to appreciate the benefits achievable using simple low-cost measures, and focus on expanding production rather than improving efficiency. Some will believe that no progress can be made without massive investments in new technology, and that—since the company lacks funds—nothing can be done.

With respect to transmission and distribution of electricity, the challenge for many utility companies will probably be the funding of large investments to replace old equipment or to add significantly to capacity, as electricity demand grows quickly in developing countries. Load aggregation is interesting because the problems of several customers can often be solved at the same time. However, it is essential that comprehensive historical data on load profiles is available, and such data is readily available at any time in the future. Analysis of this data may have to be done by outside specialists if the expertise is not available in-house. Reliable and timely data are needed to ensure that the proper combined load profile is being maintained and that all parties, including the utility, are benefiting.

Finally, power factor improvement and challenges is something that both parties, the electricity consumer (who will probably have to invest in the necessary equipment) and the supplier, must see the benefits for themselves.

7  CONCLUSION

With increasing demand for energy worldwide and the resources being limited or becoming ever more expensive, it is important (and usually cost effective) to improve the efficiency of energy supply. This, in turn, usually means a benefit to the energy consumer in terms of lower energy prices. Improved efficiency on the supply side will also contribute valuably to reducing the impact of energy use on the environment. While demand-side improvements are certainly important, supply-side options also need to be identified, evaluated and implemented where the economics justifies.

Miss Adhikari is an Industrial Engineering Student (Fourth Year) in Thapathali engineering Campus

This article is taken from Urja Khabar bi-annual Journal Publish on 16th June, 2023