BC HYDRO UNDERTAKING
BC HYDRO REVENUE REQUIREMENT HEARING
2004/05 AND 2005/06
,--'.
HEARING DATE
BRITISH COLUMBIA UTI LlTlES
MMISSION
June 3, 2004
TRANSCRIPT
REFERENCE
BY
Volume 16, Page 2675
REQUESTOR:
JIESC
QUESTION
Please provide a document or written summary that explains the substantive
process by which the PET is filled out. Specifically, please explain how the
numbers are derived and how DloB ensures those numbers are consistently
derived.
RESPONSE
Further to the submission of the PET User Manual, attached are sheets for each of
the drivers in PET which describe the substantive process. These sheets are
extracted from the PET on-line help file. As well, attached are detailed input sheets
extracted from the PET software which show the driver categories and the input
valuations.
PET provides a rigorous and comprehensive evaluation of system improvement projects.
The tool is recognized by EPRI as leading edge. The tool is used for all system
improvement projects, is well understood by those using the tool, and has been in place
for several years. The result is that system improvement projects are appropriately
prioritized, and the resulting investments are prudent and beneficial to customers.
The predominant users of PET are the Field Service Engineers who are fully
trained and qualified to use the software. Specifically, effective use of PET
requires significant expertise with a solid foundation in electrical principles and in
statistical analysis. The Field Service Engineers use expert judgement in
developing the inputs for PET. For example, in determining the possibility of an
overloaded circuit, the engineer must understand the detailed functionality of the
various pieces of equipment, their ratings and overload capabilities (non-linear
relationship between level of overload and life expectancy and risk of failure of
equipment), and must be able to model the performance of the system under a
variety of overload conditions. The culmination ofthis assessment is the
identification of the equipment at risk for a circuit and the probability of failure. All
other inputs to PET require similar levels of engineering expertise. Those involved
in using Pet and in developing the comprehensive analysis required, are qualified
for this work and receive regular training on PET and on technical assessment.
Specific training in the use of PET includes a thorough understanding of the
drivers and their valuations, and reviews of typical and sample projects.
Experienced users, area planners and the Capital Program leader assist in the
training, particularly for new users of PET.
The Pet tool provides rigor and consistency in the following ways: 1) the structure
and format ensure that all projects are valued against the same drivers with the
same weighting, 2) the driver criteria is based on utility and industry standards (eg
acceptable voltage levels), and 3) expert judgement is appropriately incorporated
(eg overload conditions and probabilities).
As a descriptive example, following are comments on the Equipment Overload
driver:
The Field Service Engineer responsible for identifying needs on the distribution
system, must first determine which piece of equipment on the distribution feeder
is limiting the ability of the circuit to provide the needed capacity. Then the
capability of that equipment, based on specific model and type, needs to be
defined based on BC Hydro accepted standards. Then the estimated upcoming
peak load must be determined and entered to calculate the system shortfall.
Solutions are considered and may be as simple as upgrading a piece of
equipment or as complicated as redesigned a portion of the system. Project
alternatives are developed with full consideration to lowest life cycle cost. The
risk of project deferral is also entered in terms of the cost of an event should the
equipment fail, and the probability of that event occurring. The tool provides
parameters to guide the probability assessment as described in the attached
sheets. Given the input cost and risk parameters the tool calculates the project
priority value, meaning the benefit (or lack thereof) of proceeding with the project.
Once a project is identified and proposed, there are several levels of review as
described in detail in the previous response. The Area Planner reviews the Field
Service Engineers PET submission to validate adequate consideration of solution
options, to verify PET prioritization, and to review adequacy related to broader
business needs and system drivers. The Area Planner then reviews one or more
project proposals with the Capital Program Leader. Periodically all projects are
also reviewed by the Distribution Engineering Manager, the Distribution Planning
Manager, and the Distribution Strategic Planner. Project approval and financial
authorization also follows prescribed accountabilities including the Capital
Program Leader and the Distribution Planning Manager.
Equipment Overload Driver
To determine the risk cost for an equipment overload condition, the following values
must be entered or selected:
1. The type of equipment at risk.
2. The rating of the equipment in kVA.
3. The equipment maximum loading capability as a percentage of the equipment kVA
rating.
4. The estimated actual equipment load in kVA for the first year of the analysis,
followed by the annual load growth rate (in percent) for each subsequent year.
5. If the occurrence of the overload hazard is dependent upon a contingency condition
arising, the probability of the contingency occurring must be entered for each year of
the analysis. If a contingency is not involved, leave the entry blank (interpreted as
1.0) or enter 1.0.
6. If the project is deferred, enter the restoration costs (in k$ for each year) that will be
incurred due to the equipment overload or failure.
The rating in item 2 refers to the nameplate rating. For item 3, if there is no overload
capability (above the nameplate rating), set the value to 100%. The maximum allowable
rating of the equipment is determined from the product of the two values (items 2 & 3).
The estimated load is compared against the maximum allowable rating to determine the
probability of occurrence (also incorporates the contingency probability) which is
subsequently used to calculate the risk cost.
Reliability Driver
The hazard cost for unacceptable reliability is based on the amount of improvement in
the SAlOl statistic with the maximum possible improvement being the SAlOl target.
Improvement below the SAlOl target value will have no monetary value.
The SAlOl target can be entered directly or automatically extracted by using the Circuit
function button. The purpose of the function button is to allow the selection of the SAlOl
information directly from a file which contains reliability statistics at the circuit level. For
cases where no information available at the circuit level, the available circuits displayed
for the selected substation is ALL which, when selected, provides SAlOl statistics at the
substation level. Both the target value and the expected value without the project in
service are provided automatically when a circuit is selected. Note that both values can
be manually entered if desired.
The expected SAlOl value must also be entered if the project is constructed. In addition,
a probability value must be entered to quantify the level of confidence in the expected
SAlOl value.
The number of customers to be entered is the number of customers affected by the
project (the number of customers affected by the average outage value entered). If the
number of customers is unavailable or difficult to determine, the amount of load affected
(in kVA) can be entered as an alternative. Based on the load value, a system equivalent
number of customers will be determined. If the number of customers and the load
affected are both entered, the number of customers used in evaluating the risk cost will
be the maximum of the actual number and the system equivalent.
For each year of the analysis, the expected percentage increase in the number of
customers (or load if a load value has been entered) must be entered.
If deferment of the project would directly affect a high priority customer (Le. Hospital,
essential service or process, etc.) the YES box should be selected to incorporate this
consideration into the risk cost.
Power Quality Driver
The Power Quality Driver is designed to consider the following power quality conditions:
=> Overvoltage
=> Undervoltage
=> Voltage Flicker
=> Harmonics
=> Voltage Imbalance
To include a power quality disturbance type in the analysis, the Yes box must be
selected at the top of the power quality worksheet. If desired, all power quality
conditions can be included (all Yes boxes are selected).
The hazard cost for an unacceptable power quality condition is evaluated as a function
of the severity of the operating condition (without the project) relative to the desired
acceptable value or target. The target value for each power quality condition is clearly
identified.
For determining the number of days to be entered, if the particular power quality
disturbance occurs at any time in a day, then the day should be counted.
The number of customers to be entered is the number of customers affected by the
project. If the number of customers is unavailable or difficult to determine, the amount of
load affected (in kVA) can be entered instead. Based on the load value, a system
equivalent number of customers will be determined. If the number of customers and the
load affected are both entered, the number of customers used in evaluating the risk cost
will be the maximum of the actual number and the system equivalent.
Safety Driver
The safety risk cost is determined based on the probability of an equipment failure
occurring and the assigned monetary value for the impact of the failure. The target or
desired outcome is that there is no safety hazard. The risk cost of a failure considers the
average liability associated with an injury or death as a result of the failure.
The consequence (and risk cost) of an equipment failure is determined on the basis of
assigning a judgemental probability code to each year of the analysis. The actual
probability associated with a probability description can be displayed by clicking on the
description. The probability is incorporated into the risk cost.
The calculation of the probability of the hazard having an impact is also evaluated
according to where the failure is expected to occur. The area reflects the possible
number of people that may be impacted as a result of the failure.
Legal & Regulatory Driver
The Legal & Regulatory Driver is designed to consider situations where a cost may arise
due to a legal requirement (Le. aerial trespass, litigation, etc.) or a regulatory (legal or
legislative) directive. The consequence (and risk cost) of a legal or regulatory situation is
determined on the basis of assigning a judgemental probability code to each year of the
analysis. The actual probability associated with a probability description can be
displayed by clicking on the description.
The judgemental probability is applied to the hazard cost entered to determine the risk
cost.
OA TE...,.
06"()4.2004
Select the type of equipment
Trnnsfonner
II
Regulator
o
at risk of being overloaded
o
:.
Line
o
o
Cable
Other
o
t~~
Enter the foHowing data for the equipment'
"Nameplate" rating of the equipment in kVA ================>
Equip, maximum loading capability in % of "nameplate" rating==>
c::::::JkVA
c=::J%
Expected equipment
load 8. load growlh for each year =======>
Enter expected load !!:I..!sY8 for the first year
and the load growth rate lin 'Yo!for subSjNueo1 year$ :
. ..-...
If the project is deferred, enter the emergency restoration cost that
would be incurred due to the hazard occuring each year (1<$):
Equipment Overload Marginal AnalysIs Risk Cost (k$)
=======>
Equipment Overload Present Worth Value Risk Cost (k$)
Marginal Analysis
Project Priority Indicator
=====>
========>
Present Worth Analysis Project Priority Indicator ====>
~
~
I
I
DATE->
06.04-2004
For the customers affected by the project, to extract the SAID! statistics
select the appropriate circuit by clicking on the .Circuit" button below.
( CircUit)
(at the circuit level),
I Currentcircuitselected _>
TargetMID! based on circuitselected
"''''
(
>
Without the project in service,
enter the average outage duration per customer (SAlOl) for each year:
(the default value is for the circuit selected above)
Year
SAi6i"
With the project in service,
enter the expected average outage duration per customer (SAlOl)
and the probability 0( occurrence 0( SAlOl:
Enter the total number of customers affe<::ted
Enter the load affected by outage (kVA)
OR
Enter the percentage incre3se
in the number of customers
]
>
"'=.."'
==
=>
[
)
or load affected for each year:
,.,. .
Is an essential
or high priority customer
involved (i.e. Hospital, etc.)?
Yes
ilk>
o
ReliabilityMarginal AnaIY$jsRisk Cast (k$) ==
>
0)
ReliabilityPresent Worth Value Risk Cast (1<$)===
>
0)
Marginal Analysis Project Priority Indicator ==-===>
)
Present
)
Worth Analysis
Project
Priorttylndlcator
=====>
DA Tc->
j
Select
If
06-04-2004
the types of unacceptable
power quality which wiRoccur (multiple selections can be made) :
Types of PQ Qimyrt>ances
To include a PQ Disturbance
Type, click on the respective
Yu,.box
(the default Is ~
I
No
o
Ovel"lol!age
D
o
o
o
Undervoltage
After alt ule<;t!ons are
complete, scroll down to
complete the data entry for the
se!eded types.
Will Occur?
Yes
VoItag$ Flicker
Harmonics
o.qJ
Power Quality Present
Worth Value Risk Cost (k$)
__====-=>
Marginal Analysis Proje.ct Priority Indicator =====:>
Present Worth Analysis Proje.ct Priority Indicator
=====>
0.0)
DATE==>
06-04-2004
Enter a description of the "hazard" (Le. possible consequence
If the project does not proceed, enter the probability
ot equipment failure occurring each year using the
following judgemental
(
probability
code assignments :
Judgemental ProbabiJi!v
Definitely
Vli!rylikely
Likefv
UnlikefY
VeryUnllkelv
NoOccurrence
o
Safety Marginal Analysis
Safety Present
Vear
~J
f'robablUty Code
:1
3
4
6
I
f
To vie'w too j:l("ob$bililyvalue
associated
with a judgemental
prooob
d!'I$CriptiOl1, elicit on the oo$Criplioo
5
£
failure would occur;
Rural
o
o
==============>
Worth Value Risk Cost (k$) ============>
Marginal Analysis ProjectPrJority
3
Code
1
Urban
Risk Cost (1<$)
a
:2
6
<'"'"=J~<lgementalProbabilityCode.
Select the type of area where the equipment
Metropolitan
if nothing is done) ;
Indicator =-====>
Present Worth Analysis Project Priority Indicator ==>
Remote
o
0)
0]
]
J
'''--'''--
ility
W( wd.
4
6
. .Judgemental ProbabilityCode.
DATE==>
06-04-2004
Enter a description of the "hazard" (I.e. possible consequence
if nothing is done)
1
;
3
If the project does not proceed, enter the probability
of the "hazard" occurring each year using the
fOllowing judgemental probability
code assignments
:
Judgemental
Probability
Definitely
Very L.ik,,1y
l.lkely
Unlikely
Ve.ry Unlikely
No O<:curr"m:c
<===Judgemental
F'robabUiIy Code.
Code
1
2
:1
4
To view !Iw probability value
associated
with a judgemental
probability
descriptioo. clici ( 011Ihe deaooPlfOl1 word.
5
8
If the project does not proceed, enter the expected
"hazard" cost incurred for each year (k$) :
t:~
3
01
<======= "Hazard" Cost (kS). . . . . . .
Legal and Regulatory Marglna! Analysis Risk Cost (k$)
=========>
Legal and Regulatory Present Worth Value Risk Cost (k$)
======>
Marginal Analysis Project Priority Indk;ator ======>
Present Worth Analysis Project Priority Indicator ======>
C::::2]
C::::2]
C=::J
C=::J
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