PQ is not only about technology, solutions pivot on economics
The robust power quality (PQ) protection equipment market, with total revenues of $1.4 billion in 1998, is the place for suppliers eager to carve out a profitable niche. Frost & Sullivan, an international marketing consulting company, recently conducted research indicating growth is expected to continue throughout the forecast period 1998 to 2004.
Weighing in to take advantage of this promising market, several industry players recently announced alliances to beef up their presence.
Capturing the PQ market share
American Electric Power, Bechtel Enterprises Holdings Inc. and Siemens Power Transmission & Distribution Inc. formed a joint venture company, Lectrix LLC, San Francisco, to provide industrial PQ solutions.
Estimating that PQ problems cost U.S. industry about $26 billion a year in lost production or equipment damage, with a single shutdown costing as much as $500,000 per hour, Lectrix plans to offer solutions that guarantee results while allowing industrial customers to avoid costly equipment investments. Lectrix will build, own and operate equipment and provide service guarantees to its customers.
Semiconductor manufacturers and data centers will be the early markets for the company. Keith Burrowes, Lectrix`s president and CEO, said, “Semiconductor manufacturers and data centers are especially sensitive to changes in power quality. We want to work directly with these companies to place devices at the customers` electric service entrances to condition the power and eliminate problems. We will also work with the high-tech industrial parks to provide similar services for the entire park.”
Another alliance recently formed to capture a larger piece of the PQ market consists of Power Measurement Ltd., provider of power metering and monitoring solutions, and Conectiv Solutions, an energy service provider. Conectiv will now recommend, sell and integrate Power Measurement`s power metering and PQ products exclusively.
Modeling streamlines PQ selection
These companies, as well as electric utilities, will not only need to meet customers` PQ demands, they will also need to find the most cost effective solutions. Power conditioning solutions may include dynamic voltage restorers, superconducting energy storage devices, solid state transfer switches, written pole motor generator sets, transient voltage surge suppressors, and shielded isolation transformers.
Determining the best solution requires quantifying the real cost of the problem and performing system level comparisons of alternate solutions. EPRI recently developed a program to facilitate such comparison.
The Power Quality Diagnostic System consists of four CD-ROM modules to aid utilities in providing new power quality contracts and services:
– Module 1: enables engineers to quickly identify PQ events such as harmonics, lightning surges, voltage sags, capacitor switching and motor starting;
– Module 2: facilitates analysis of large quantities of PQ measurement data;
– Module 3: performs computer-based simulations to help solve typical PQ problems; and
– Module 4: conducts cost-benefit analyses for various PQ improvement technologies. The following cost categories are included: lost production, restart costs, repair and replacement costs, scrap, labor and other costs. Cost categories for power conditioning alternatives include purchase cost, operations cost, costs due to impact on losses, installation costs, maintenance costs and reliability considerations.
A paper presented by EPRI`s Sid Bhatt at the 8th International Power Quality Applications Conference, Cape Town, South Africa, in November 1998, illustrated the model used in determining economic impacts of PQ variations. (see figure) From the top of the model, the utility may perform some special conditioning for a group of customers. Each customer, in turn, may perform some conditioning at the service entrance level, resulting in power being made available to the various processes in the plant at a changed PQ level. Some degradation in the quality may occur due to wiring and grounding problems. Finally, each process may have its own conditioning such as a UPS.
The remainder of the model deals with the costs due to imperfect PQ. All cash flows are considered to be costs flowing out of the various parts of the model affected by PQ (shaded boxes) or efforts to improve PQ (clear boxes).
The model also includes energy costs, accounting for the extra cost resulting from addition of power conditioning devices.
For additional information about the Power Quality Diagnostic System, call EPRI`s Electric Power Software Center at 800-763-3772.