overhaul diesel engines - pub diesel engines newfoundland and labrador hydro i summary this report...

A REPORT TOTHE SoMo OF COMMISSIONERS OF PUBLIC UTILITIES

Electrical

Mechanical

Civil

( Protection & Control

& Distribution

System Planning

Overhaul Diesel Engines

Various Locations

July 2012

newfoundland labrador

hydroa nalcor energy company


Newfoundland and Labrador Hydro i

SUMMARY

This report presents the capital budget proposal for diesel engine overhauls performed on a

usage-based schedule at an interval of 20,000 operating hours. Overhauls or long block

replacements are required to ensure the generator set is able to meet its Hydro expected

life of 100,000 hours. The projection of future overhauls forecasts 48 overhauls over the

2013 to 2017 period at a total estimated cost of $5.12 million.


Newfoundland and Labrador Hydro ii

TABLE OF CONTENTS

SUMMARY .................................................................................................................................. i

1 INTRODUCTION ................................................................................................................... 1

2 PROJECT DESCRIPTION ........................................................................................................ 2

3 JUSTIFICATION .................................................................................................................... 3

3.1 Existing System .......................................................................................................... 3

3.2 Operating Experience ................................................................................................ 4

3.2.1 Reliability Performance .................................................................................. 5

3.2.1.1 Outage Statistics ......................................................................................... 5

3.2.2 Safety Performance ....................................................................................... 7

3.2.3 Environmental Performance .......................................................................... 7

3.2.4 Industry Experience ....................................................................................... 8

3.2.5 Vendor Recommendations ............................................................................ 8

3.2.6 Maintenance or Support Arrangements ........................................................ 8

3.2.7 Maintenance History ..................................................................................... 8

3.2.8 Historical Information .................................................................................... 9

3.2.9 Anticipated Useful Life ................................................................................... 9

3.3 Development of Alternatives ..................................................................................... 9

3.4 Evaluation of Alternatives .......................................................................................... 9

3.4.1 Economic Analysis ........................................................................................ 10

4 CONCLUSION ..................................................................................................................... 11

4.1 Budget Estimate ....................................................................................................... 11

4.2 Project Schedule ...................................................................................................... 11

APPENDIX A ............................................................................................................................ A1


Newfoundland and Labrador Hydro 1

1 INTRODUCTION

Hydro’s Diesel Engine Overhaul Project has been developed to ensure the reliability of

diesel engines at prime power diesel generating stations. Hydro has 21 prime power diesel

generating stations serving approximately 4,400 customers. With the exception of two

systems (Ramea and L’Anse-au-Loup), these generating stations are the sole source of

electricity for their community which means that if the station cannot meet the load then

customer outages will occur. The reliability of the prime power diesel generating stations is

single contingency, meaning that the plant is designed to be able to provide maximum load

in the event of the unavailability of up to one diesel unit (due to failure). This means that

while the failure of a single unit will not result in customer outages the failure of any

additional units before the initially failed unit is returned to service may result in customer

outages. This highlights the importance of the reliability of these diesel engines. In short,

the prime power diesel generating stations are the only power source for their community

and require major overhauls to achieve their expected service lives while providing reliable

power.

Figure 1 below is a photo of Ramea Unit 2077 prior to its installation in the Ramea Diesel

Plant.

Figure 1: Ramea Unit 2077



2 PROJECT DESCRIPTION

This project is required to overhaul the diesel engines at diesel generating stations. The

project consists of overhauling 48 engines over the next five years (2013 to 2017). The

overhaul schedule, which can be found in Appendix A, is based on the engines being

overhauled every 20,000 hours of operation. This is the criteria being used for diesel engine

overhauls. The overhaul schedule is a projection based on the estimate of when each

engine will reach 20,000 operating hours since its last overhaul. For a typical unit, 20,000

operating hours accumulates on average in 8.7 years but it depends on the usage of the

engine. As such, this schedule is subject to change and the year for which an engine is

projected to become due for an overhaul can vary depending on plant conditions and the

actual hours accumulated. While the specific engines projected to be due for overhaul in a

given year can vary from year to year, the number of engines projected to be due for

overhaul in a given year tends to be relatively consistent.

An overhaul consists of either a rebuild or a long block replacement. A rebuild consists of

the replacement of pistons, liners, main bearings, connecting rod bearings, fuel injectors, oil

cooler, turbo charger, water pump, oil pump, cylinder heads and all necessary gaskets. Also

included in a rebuild is a bench overhaul of the fuel pump and an overhaul of the alternator,

typically at 40,000 hours or when identified through maintenance checks. A long block

replacement consists of replacement of the block of the engine minus the auxiliary parts

such as cooler, actuator, turbo chargers, manifolds, and fuel lines. Both rebuilds and long

block replacements use remanufactured parts and include the replacement of the fuel lines.

The long block replacement program also comes with the advantage of warranty and a

manufacturer overhauled engine that can be delivered to site. Hydro is utilizing the long

block replacement approach where possible in the northern Labrador region to minimize

travel costs and engine downtime.



3 JUSTIFICATION

3.1 Existing System

The existing system of isolated diesel generating stations consists of prime power diesel

engines at 21 isolated diesel generating stations. The number of units at a generating

station ranges from three to five and the rated output of the units range from 30 kW to

1,825 kW. The diesel engines range in age from one year to 41 years and currently range in

operating hours from less than 500 hours to over 122,000 hours (as of the end of 2011).

Please refer to Table 1 below for details concerning the major work and upgrades to each

diesel engine during the previous five years.

Table 1: Major Work and/or Upgrades

Year Major Work and/or Upgrade

20121 Long block replacement of Black Tickle Unit 579

20121 Overhaul of Charlottetown Unit 2061

20121 Rebuild of Hopedale Unit 2054

20121 Rebuild of Little Bay Islands Unit 2058

20121 Rebuild of Makkovik Unit 2059

20121 Rebuild of Ramea Unit 2047

20121 Rebuild of St. Brendan’s Unit 578 (alternator only)

2012 Rebuild of Cartwright Unit 2052

2012 Long block replacement of Hopedale Unit 2074

2012 Rebuild of St. Lewis Unit 2080

2011 Rebuild of Grey River Unit 2062

2011 Rebuild of McCallum Unit 2063


2011 Rebuild of St. Brendan’s Unit 2056

2011 Rebuild of St. Lewis Unit 2039

2011 Rebuild of William’s Harbour Unit 2057

2011 Rebuild of Port Hope Simpson Unit 2042


2011 Rebuild of Rigolet Unit 2081


2011 Rebuild of Postville Unit 577


1 Refers to planned work for the stated year.



Year Major Work and/or Upgrade



2010 Rebuild of Spare Unit 2072

2010 Rebuild of Charlottetown Unit 2079

2010 Rebuild of Mary’s Harbour Unit 2038


2010 Rebuild of Nain Unit 574




2009 Rebuild of Paradise River Unit 254


2009 Long block replacement of Postville Unit 573

2009 Rebuild of Makkovik Unit 2059

2009 Long block replacement of Makkovik Unit 2029




2009 Replacement of Cartwright Unit 567 with Unit 2086

2008 Rebuild of Grey River Unit 2067


2008 Long block replacement of Mary’s Harbour Unit 2037

2008 Rebuild of Norman Bay Unit 561

2008 Installation of Norman Bay Unit 562

2008 Long block replacement of Port Hope Simpson Unit 2042


2008 Rebuild of Black Tickle Unit 2066

2008 Rebuild of Paradise River Unit 324

2008 Rebuild of Postville Unit 577

2008 Long block replacement of Makkovik Unit 3033

2007 Rebuild of Francois Unit 570

2007 Rebuild of Little Bay Islands Unit 2058


2007 Long block replacement of Charlottetown Unit 2034

2007 Rebuild of Charlottetown Unit 2061

2007 Rebuild of Black Tickle Unit 287


3.2 Operating Experience

Isolated diesel generation operates continuously since it provides the primary source of

electricity to communities isolated from the province’s electrical grid. A given unit is not in

service continually since the number of units in service varies based on the demand. In



automated plants the engine mix is automatically controlled by a control system to

maximize fuel efficiency, while in a manual plant this is controlled by the operator.

In any of the plants the operator has the flexibility to shut down engines for maintenance

provided there is another engine available to take the load for that time. As a result outages

to engines can occur without outages to customers.

3.2.1 Reliability Performance

A consequence of not completing this project is an increase in the frequency and duration

of customer outages (i.e. higher SAIDI and SAIFI values) as a result of an increase in diesel

unit failures.

3.2.1.1 Outage Statistics

Hydro tracks all distribution system outages using industry standard indexes, SAIDI and SAIFI

which are explained as follows:

SAIDI- indicates the System Average Interruption Duration Index for customers served per

year, or the average length of time a customer is without power in the respective

distribution system per year.

SAIFI - is the System Average Interruption Frequency Index per year which indicates the

average of sustained interruptions per customer served per year or the average number of

power outages a customer has experienced in the respective distribution system per year.

Loss of Supply is defined by the CEA as:

Customer interruptions due to problems in the bulk electricity supply system such as

underfrequency load shedding, transmission system transients, or system frequency

excursions. During a rotating load shedding cycle, the duration is the total outage time until

normal operating conditions resume, while the number of customers affected is the



average number of customers interrupted per rotating cycle.

In this case it applies to the loss of the diesel plant.

Table 2 below lists the SAIDI Loss of Supply outage statistics for the prime power diesel

generating stations for the previous five years. Table 3 below lists the SAIFI Loss of Supply

outage statistics for the same diesel generating stations for the previous five years.

Table 2: 2007 to 2011 Outage Statistics (SAIDI Loss of Supply)

System SAIDI (Loss of Supply)

2007 2008 2009 2010 2011

TRO Central

Francois (FRS) 0.550 2.583 0.481 0.833 0.249

Grey River (GYR) 0.083 0.000 0.000 0.165 0.000

Little Bay Islands (LBI) 0.167 3.333 1.084 0.083 3.561

McCallum (MCC) 0.000 0.000 1.500 0.167 0.000

Ramea (RAM) 2.183 1.518 0.167 0.283 1.221

St. Brendan's (SBN) 0.000 0.083 0.000 0.017 0.000

TRO Northern

Charlottetown (CHT) 0.682 2.233 3.667 1.545 0.133

L’Anse-au-Loup (LAL) 0.000 1.656 0.576 1.561 1.167

Mary's Harbour (MSH) 3.925 1.205 7.284 4.408 0.661

Norman Bay (NOB) 3.553 4.129 1.250 0.167 2.834

Port Hope Simpson (PHS) 6.282 0.783 0.000 1.228 0.550

St. Lewis (SLE) 0.450 0.455 0.566 0.500 1.531

William's Harbour (WHR) 1.000 1.083 0.450 0.333 12.167

TRO Labrador

Black Tickle (BKT) 0.483 18.900 2.078 11.892 2.867

Cartwright (CTW) 1.433 6.400 0.417 3.850 0.699

Hopedale (HPD) 8.241 5.100 3.302 6.913 2.406

Makkovik (MAK) 0.500 2.717 2.933 0.238 2.087

Nain (NAN) 0.533 11.265 4.651 3.767 1.407

Paradise River (PDR) 0.267 0.269 0.383 5.050 2.924

Postville (POV) 0.617 4.400 4.500 0.901 1.866

Rigolet (RIG) 0.850 1.967 4.312 3.503 0.616



Table 3: 2007 to 2011 Outage Statistics (SAIFI Loss of Supply)

System SAIFI (Loss of Supply)

2007 2008 2009 2010 2011

TRO Central

Francois (FRS) 5.000 2.000 5.961 3.000 1.987

Grey River (GYR) 1.000 0.000 0.000 1.986 0.000

Little Bay Islands (LBI) 1.000 5.993 6.000 1.000 5.947

McCallum (MCC) 0.000 0.000 1.000 1.000 0.000

Ramea (RAM) 2.000 5.266 1.000 3.000 9.537

St. Brendan's (SBN) 0.000 1.000 0.000 1.000 0.000

TRO Northern

Charlottetown (CHT) 5.990 5.000 6.000 11.953 2.000

L’Anse-au-Loup (LAL) 0.000 1.000 1.394 3.99 1.996

Mary's Harbour (MSH) 15.032 9.762 12.004 8.923 5.947

Norman Bay (NOB) 17.003 17.158 6.000 1.000 18.000

Port Hope Simpson (PHS) 13.987 4.000 0.000 4.978 3.000

St. Lewis (SLE) 5.000 2.015 2.992 3.000 7.969

William's Harbour (WHR) 5.000 13.000 6.000 4.000 2.000

TRO Labrador

Black Tickle (BKT) 4.000 17.000 10.981 4.981 4.000

Cartwright (CTW) 7.000 10.000 6.000 10.994 3.991

Hopedale (HPD) 9.009 7.000 11.000 11.602 5.902

Makkovik (MAK) 1.000 7.000 4.000 1.930 9.935

Nain (NAN) 1.000 17.998 10.951 6.937 5.935

Paradise River (PDR) 3.000 5.000 4.000 7.000 5.892

Postville (POV) 2.000 17.000 8.000 2.953 9.000

Rigolet (RIG) 7.000 4.000 8.975 2.958 1.994

3.2.2 Safety Performance

This is a reliability-based project. However, if this project is not executed, there is a higher

risk of diesel engine failure and diesel engine failure can result in extended customer

outages which can negatively impact public safety.

As well diesel engines can fail catastrophically with possible flying hazards for the

employees in the vicinity. The risk of this occurring increases if overhauls are not

completed.

3.2.3 Environmental Performance

This project is being justified from a reliability perspective but if overhauls are not



completed, failures could result in oil and glycol being released into the environment.

3.2.4 Industry Experience

Manufacturers of diesel engines will provide recommended overhaul frequencies which

typically are in the 15,000 hour range. Hydro adopted this philosophy for many years but

completed a review of its maintenance tactics in 2003 and extended the overhaul period to

20,000 hours.

3.2.5 Vendor Recommendations

The diesel engine manufacturers generally recommend an overhaul interval of 15,000 hours

but as a result of a review of maintenance tactics and failure history it was decided to

extend Hydro’s overhauls to 20,000 hours.

3.2.6 Maintenance or Support Arrangements

Generally, a routine annual inspection is performed by internal resources. The annual

inspection checks the fuel, coolant, and exhaust systems as well as the engine structure.

Problems identified during the inspection are typically corrected during the inspection. If an

engine fails prematurely, the manufacturer is typically consulted to help with a failure

analysis.

Also, to help manage the service of the parts for diesel engine, blanket orders have been set

up for Caterpillar and Detroit Diesel engines. Such arrangements are necessary to ensure

lead times on parts are acceptable and Hydro does not have to incur the cost of stocking

diesel parts in inventory.

3.2.7 Maintenance History

The five-year maintenance history for the prime power diesel engines is shown in the

following table:



Table 4: Five-Year Maintenance History

Year

Preventive

Maintenance

($000)

Corrective

Maintenance

($000)

Total

Maintenance

($000)

2011 69.0 782.7 851.7

2010 80.7 1,309.8 1,390.5

2009 40.2 1,265.4 1,305.6

2008 29.7 871.8 901.5

2007 24.8 950.5 975.3

3.2.8 Historical Information

Prior to 2012, diesel engine overhauls were being performed as operating projects.

Between 2007 and 2011, an average of 9.8 engines (49 over five years) were overhauled

annually. In 2012, Hydro adopted International Financial Reporting Standards (IFRS). Under

the IFRS, major overhauls are capitalized. As a result, since 2012, diesel engine overhauls

have been performed under capital projects.

3.2.9 Anticipated Useful Life

The diesel engines have an estimated service life of 25 years. Actual life depends primarily

on the operating hours of the unit.

3.3 Development of Alternatives

The alternatives considered for this overhaul project were to either rebuild the engine with

internal resources or purchase a rebuilt long block from the manufacturer. Overhauls in

areas in Central and Northern are planned to be rebuilt by internal forces, while selected

overhauls for Labrador are planned to use rebuilt long blocks from the manufacturer due to

minimizing downtime, travel, and internal resource requirements.

3.4 Evaluation of Alternatives

In evaluating the two alternatives, it was decided for the island and on the south coast of

Labrador that overhauls should typically consist of rebuilding the engines with internal

resources. In Labrador, selected engines will use long block replacements which are

essentially engines that have been rebuilt by the manufacturer.



From Hydro’s experience in using long block replacements the following has been noted:

a. A reduction in downtime of the unit. The long block replacement time is

shorter than having to complete an overhaul;

b. The travel time and travel cost is less for long block replacements. This can

be amplified when weather delays occur, which are common in northern

Labrador; and

c. On the north cost of Labrador, in particular, long blocks have helped

improved resource management, to free up resources to deal with other

priority maintenance issues.

Based upon the above, the benefits are mainly in northern areas in which you have to fly in

and out, such as on the north coast of Labrador. As a result Hydro’s budget proposal for

2013 is only considering long block replacements in the Labrador region and engine rebuilds

by internal resources in the Central and Northern regions.

3.4.1 Economic Analysis

There was no economic analysis completed for the two alternatives, as the main options for

the majority of overhauls will be rebuilds of engines with internal resources. The option to

use long block replacement will be used in locations of Labrador only to reduce downtime

on a unit and help minimize internal resource requirements for overhauls due to travel time

to areas on the coast of Labrador. While long block replacements are typically marginally

more expensive than a rebuild, travel in remote areas can be a significant factor in the

overall cost. We will evaluate whether the use of rebuilds or long block replacements of

engines in Labrador is the least cost option consistent with reliability in each community.



4 CONCLUSION

This project is necessary in order to provide least-cost, reliable electrical service to the

customers served by isolated diesel generation. Overhauling diesel engines is a necessity in

operating this type of equipment.

4.1 Budget Estimate

Table 5: Project Budget Estimate Project Cost:($ x1,000) 2013 2014 Beyond Total

Material Supply 622.0 0.0 0.0 622.0

Labour 133.1 0.0 0.0 133.1

Consultant 0.0 0.0 0.0 0.0

Contract Work 15.0 0.0 0.0 15.0

Other Direct Costs 61.0 0.0 0.0 61.0

Interest and Escalation 63.6 0.0 0.0 63.6

Contingency 83.1 0.0 0.0 83.1

TOTAL 977.8 0.0 0.0 977.8

4.2 Project Schedule

Table 6: Project Schedule

Activity Start Date End Date

Planning Schedule annual overhauls January 2013 February 2013

Procurement Purchase overhaul components February 2013 March 2013

Installation Complete overhaul March 2013 December 2013

Commissioning Testing after overhaul March 2013 December 2013

Closeout Release For service and Asset Assignment September 2013 December 2013


Appendix A

Newfoundland and Labrador Hydro A1

APPENDIX A

Diesel Engine Overhaul Five Year Plan


Appendix A


Unit Planned Year of

Overhaul

2013

FRS 570 2013

GYR 2067 2013

Mobile 2071 2013

CHT 2034 2013

MSH 2037 2013

NOB 581 2013

PHS 2073 2013

WHR 580 2013

NAN 576 2013

POV 2084 2013

POV 573 2013

2014

CHT 2087 2014

MSH 2038 2014

BKT 582 2014

CTW 2052 2014

CTW 2086 2014

MAK 2059 2014

NAN 2085 2014

PDR 324 2014

2015

LBI 586 2015

MCC 2064 2015

SBN 2055 2015

MSH 2083 2015

PHS 2043 2015

HPD 2054 2015

MAK 3033 2015

NAN 574 2015

POV 577 2015

2016

FRS 587 2016

GYR 2062 2016

LBI 2035 2016

RAM 2045 2016

CHT 2079 2016

WHR 2075 2016

BKT 2066 2016

HPD 2074 2016

MAK 2029 2016

RIG 2081 2016

2017

LBI 2023 2017


Appendix A


Unit Planned Year of

Overhaul

RAM 2077 2017

MCC 589 2017

SBN 2056 2017

CHT 2087 2017

SLE 2039 2017

SLE 2080 2017

BKT 579 2017

CTW 2036 2017

HPD 2053 2017

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