Revising the Rules

CEA’s draft R&M/LE guidelines align with changing TPP requirements

Renovation and modernisation (R&M) and life extension (LE) works are cost-effective solutions for achieving improvements in operational performance and additional generation from existing units in a short period. The Central Electricity Authority (CEA) has been monitoring the R&M programme of various state-owned thermal power plants for the past three decades. Recently, in December 2019, it released the revised draft guidelines for R&M/LE works of coal/lignite-based thermal power stations (TPSs). In the revised guidelines, various provisions have been included to facilitate the R&M/LE of TPSs in view of the growing need to flexibilise operations and comply with the tightened emission norms.

The increasing integration of renewable energy sources requires TPSs to perform low load operations and undergo frequent ramping, which adversely impacts power plant performance. Thus, the new guidelines stipulate that the feasibility study for R&M/LE should include provisions for low load operation/high ramping and for compliance with the emission norms. A look at the key highlights of the revised R&M guidelines for coal/lignite-based plants…

Need for revised guidelines

The existing R&M guidelines for power plants were framed mainly for 100 MW or less capacity non-reheat-type thermal power units and for 200/210 MW units of LMZ or KWU unit designs. The CEA notes that many thermal plant units of higher capacities such as 250 MW and 500 MW have outlived their useful lives and are now due for R&M. Another need for revising the guidelines arises from the growing focus on efficient power generation and lower emissions. The government has accorded high priority to meeting the new environment norms for all TPSs and integrating 175 GW of renewable power resources by 2022. Generation maximisation, efficiency enhancement and plant uprating have been an integral part of the R&M/LE programme. Now, the focus of the programme is shifting from generation maximisation to efficient flexible operation with lower emissions. TPSs require new emission control equipment for compliance with the environmental norms, and the dynamic operation of thermal power plants (TPPs). Apart from this, the revision of R&M guidelines was required to tackle delays in achieving the desired completion targets, material constraints resulting in time and cost overruns, and the lack of provision for biomass utilisation in power generation.

Key highlights

In the revised guidelines, the CEA notes that the R&M programme is aimed at increasing generation and overcoming problems associated with generic defects, design deficiencies/modifications, inefficient operations and deterioration of coal quality.

Hours of operation: According to the CEA, the middle-life R&M of a power unit could be undertaken preferably after 100,000 hours of operation. However, the R&M of thermal units, which were designed for baseload operation, may be required even before due to their participation in flexibilisation.

RLA studies: A residual life assessment (RLA) study involving non-destructive and destructive tests is undertaken to reveal the remaining life of the critical plant components and equipment. Based on this, steps can be taken to extend the plant life by 15-20 years through appropriate repairs/replacements. The RLA study may be carried out after 100,000 hours of operation if the plant condition necessitates. The revised guidelines state that the RLA study of thermal units, which are designed for baseload operation, may be required even earlier.

Meeting environmental norms: The revised environmental norms for TPPs notified in December 2015 require TPPs to install electrostatic precipitators and, flue gas desulphurisation (FGD) systems and carry out combustion optimisation/modification to meet the particulate matter, SOx and NOx norms. Therefore, the new guidelines stipulate that a feasibility study for R&M/LE should also include the various options for meeting the new environmental norms.

R&M programme for flexibilisation: The guidelines note that there is a growing need for flexible TPP operations to balance the variability and intermittency of renewable generation. Thus, test runs and studies need to be undertaken to lower the minimum load operations and improve the ramp rate. For flexible operations, thermal power units need to install condition monitoring systems, steam/flue gas management systems and mill schedulers, upgrade the control and instrumentation system, and undertake combustion optimisation and condensate throttling, etc. to maintain operational efficiency. The new guidelines state that the feasibility study for R&M/LE should also include modifications required for low load operation/high ramping under flexible operations.

Retirement of very old units: A few operational small units of 100 MW have a very low average plant load factor, less than 50 per cent in some cases. These units are non-reheat type and have low design efficiencies. Due to ageing and technological obsolescence, these units are performing at even lower efficiency than their design value, and need to be retired in a phased manner. The R&M guidelines state that although all non-reheat units of 100 MW or less capacity could be considered for retirement, those units that have undergone major R&M/LE have been performing well and may continue to operate for another 10 years. Large units can also be considered for retirement in case of economically non-viable operations. The retirement of the units may be prioritised according to their operational performance. For instance, units with heat rate deviating more than 20 per cent from the design heat rate could be retired first while units with deviation of 15 per cent and 10 per cent, the correction factor for the unavailability of design grade coal could be considered. The guidelines for the retirement of old units remain more or less the same as the earlier guidelines.

Methodology for implementing R&M and LE&U: The new guidelines put forth recommendations for ensuring project implementation in a time-bound manner. The guidelines recommend forming separate R&M teams for the smooth execution of work, maintaining a time gap of six to eight months between detailed project report (DPR)/RLA studies and the award of projects, and adopting international or domestic competitive bidding for tendering. The guidelines also recommend ensuring clarity in the scope of work, contractual clauses and price escalation, and incorporating a penalty schedule in the contract for delays in the completion of work. Besides this, the guidelines recommend identifying areas prone to technical surprises and managing the shutdown period with proper planning.

Timelines: Apart from this, the new guidelines have modified the time frame for the implementation of R&M and LE&U schemes. The time period allowed for the appointment of a consultant by utilities is three months. Meanwhile, three months are allowed for RLA/energy audit, three months for identifying the scope of work/activities for LE&U, three months (as against six to eight months earlier) for the preparation of DPR, and six months (six to eight months earlier) for the placement of order for LE&U. As per the new guidelines, the shutdown period of a unit is six to eight months, and the implementation time after the issue of letter of award is 18-26 months.

Cost and funding: The draft revised guidelines state that the cost of the R&M/LE&U scheme should be worked out based on the estimated cost of individual works. This cost should be realistic and based on current market rates/ budgetary offers, including all taxes and duties. The imported material and the import country should be identified. Further, the source of funding should be identified along with the yearly phasing of funds required for the implementation of the scheme. Besides, the guidelines state that the cost of LE&U works should not exceed 50 per cent of the engineering, procurement and construction cost of a new generating unit with domestic content. Further, if the LE&U works are limited to boiler, turbine and generator (BTG), the cost ceiling is 50 per cent of the new BTG unit only. Apart from this, the draft guidelines have modified the payback period for R&M/LE&U works to 7-10 years, as against 5-7 years earlier. The guidelines state that to meet the new environmental norms, power utilities are mandated to install new systems involving a huge expenditure, which increases R&M costs resulting in longer payback time. The payback period for the recovery of capital expenditure on R&M works will be determined by the concerned electricity regulatory commission and will vary from project to project since it depends on the amount of capex and the balance capital cost of the project.

Conclusion

To conclude, in view of the growing renewable integration and revised emission norms, the revision of R&M guidelines for coal/lignite-based plants is the need of the hour. Once finalised, these guidelines are expected to streamline planning and implementation of R&M works at TPSs as well as modifications required for flexible operation and compliance with new emission norms.

Priyanka Kwatra

 

 

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