OVERALL EXTERNAL SERVICES COSTS

Transcription

1 EB-00-0 Exhibit C Page of OVERALL EXTERNAL SERVICES COSTS 0 INTRODUCTION THESL uses external services to complement its internal capacity to execute work programs. External services comprise those services that are generally either not available internally or insufficient resources are available to complete the required amount of work. External services are procured through service agreements negotiated with a select group of safe, reliable, cost competitive, customer-focused service providers in accordance with the Toronto Hydro Procurement Policy guidelines. The contracts are reviewed annually and structured to drive continuous improvement through cost reduction initiatives and the implementation of value added services. 0 EXTERNAL SERVICES BENEFITS The following is a summary of external services benefits: Allow THESL to focus on core competencies; Reduce the need to hire and train specialized staff that may be needed only occasionally; Reduce capital expense on fleet, equipment and facilities that may be needed only occasionally; and Allow THESL to control operating costs particularly where external options are more efficient. EXTERNAL SERVICES The following is a summary of key external services: Civil Construction Tree Trimming Wood Pole Inspection and Treatment Overhead insulator Washing

2 EB-00-0 Exhibit C Page of Cable Chamber Infrared Inspection Overhead Infrared Inspection Infrared/Ultrasonic Inspection and Carbon dioxide ( CO ) Cleaning of Padmounted Switches Transformer Vault Pressure Washing Contact Voltage Scan These external services are described in the following paragraphs. 0 0 Civil Construction Civil Construction encompasses the construction of all civil infrastructure related to THESL s capital investment program as well as the repairs and rehabilitation of existing civil assets. Although age is a factor in determining the condition of underground civil structures, it is often not the dominant factor. Other factors such as structural loading and environmental exposure have a more substantial effect on the degradation of these assets. Some of the underground structures (cable chambers/vaults) may only need cleaning or minor repairs (i.e., frames, covers, etc.); while others may require major structural repairs or even complete rebuilds. When prioritizing the replacement or rebuild of civil infrastructure, condition of the structure, capacity planning issues and City-mandated plant relocations are also taken into consideration. Cable chamber/vault degradation commonly includes spalling/cracks in concrete, corrosion of steel beams/exposed rebars and rusting of covers/frames or damage to them, which can cause tripping hazards. The introduction of acidic salts for ice melting (i.e., sulfates or chlorides) affects the corrosion rates of these assets. Cable chamber/vault systems also may experience a number of deficiencies or defects. In roadways, defects exist when covers are not level with the street surface, which can lead to flooding. Clogged sumps and non-functioning sump-pumps also represent major deficiencies in a

3 EB-00-0 Exhibit C Page of cable chamber/vault system. The overall condition of underground chambers/vaults is ranked by taking into account the following factors where applicable: Structural condition of roof, walls and floor; Existence of environmental substance such as asbestos; Condition of cable support racks; Existence of flooding; Condition of drain and sump-pump; and Size, congestion and available working space. 0 The roof of the chamber/vault deteriorates faster than its walls/floor necessitating roof rebuilds on average every to 0 years due to the ingress of salt and corrosive contaminant on the surface of the roof. The average useful life of underground structures is in the order of 0 to 0 years if periodic roof rebuilds are undertaken. THESL considers it utility best practice to contract out civil construction to service providers specialized in this area to allow THESL to concentrate on its core business of electrical installation. The costs of civil construction contracts are very competitive due to the high volume of work in this area. 0 Tree Trimming The tree trimming program is a reliability improvement initiative as described in Exhibit B, Tab, Schedule. Overhead distribution systems are prone to tree branch contacts resulting in feeder outages. To reduce the frequency and impact of tree contacts, a tree trimming program is used to maintain adequate clearances between tree branches and overhead conductors. Proper pruning of tree branches along overhead distribution routes serves to ensure that tree branches will not grow into THESL s power lines. Good tree trimming also prevents

4 EB-00-0 Exhibit C Page of brush contacts thereby reducing outage frequency during normal weather conditions. Reliability data for tree contacts generally shows improvement since 00, indicating that the continued use of a tree trimming program has reduced the number of tree related outages (see Exhibit B, Tab, Schedule, Charts and ). Some areas of the city, such as parts of downtown Toronto, require greater amounts of tree trimming due to higher density, more mature tree population and closer proximity of trees to the overhead distribution systems. 0 0 Starting in 00, THESL adopted and implemented a reliability-based tree trimming program. It is a departure from the traditional fixed area and cycle approach. The new methodology takes into consideration the reliability performance of each feeder from tree-related outages as well as the cost of trimming. The analysis yields a trim cycle for each feeder that delivers the optimum reliability performance for the amount spent. THESL also started a proactive program in 00 in addition to regular pruning work. The intention of the additional work is to prune beyond the regular pocket of tree branches around the power conductors and also identify branches outside of the pruning zone that carry a high risk of breaking and falling on power conductors during adverse weather conditions. Customer Hours Interruption ( CHI ) showed improvement from 00 to 00 and again from 00 to 00, with slight decrease from 00 to 00 as shown in Exhibit B, Tab, Schedule. Customer Interruptions have also shown a steady improvement since 00. Tree trimming impacts reliability in a manner that is different from other maintenance programs. The greatest impact may not be realized until a full trim cycle is completed. It is vital that newly grown tree limbs are pruned at the correct time to minimize outages and costs. Once a full cycle is complete, the full reliability impact will be observed. However, since 00, THESL is already observing a small, but positive impact on reliability and will continue with reliability-based tree trimming. In addition to the

5 EB-00-0 Exhibit C Page of feeders that will be addressed during the trim cycle, emphasis has been placed on the worst performing feeders that have a history of tree related outages. THESL will continue to monitor all tree-related outages and investigate their cause along with last trimmed information to update and further improve the program. 0 Wood Pole Inspection/Treatment Scheduled inspection and treatment of wooden poles for decay reduces the risk of exposure to failure, enhances system reliability and optimizes capital expenditures for replacement. Experience shows that the service life of poles with internal and/or external decay can be extended by applying sealants and treatments designed to combat decay and arrest any further degradation of the pole. This program extends the useful life of THESL s pole assets. Empirical evidence shows that a ten-year cycle of testing and treatment based on the electrical industry best practice can result in a reduction in wooden pole replacements from seven percent to two percent of the total number of poles tested. In 00, 0. percent of the poles tested required immediate replacement and 0. percent of the poles required replacement in one to five years. 0 The pole inspection and treatment program also allows THESL to identify, create and prioritize its capital replacement program based on the test results received. In addition, the program allows THESL to identify poles that may present a safety risk to the public and THESL personnel. Overhead Insulator Washing Services Twice per year, overhead insulators are washed. Regular overhead insulator washing removes summer dirt and winter salt that accumulate over time. This dirt and salt, combined with moisture, reduces insulation strength and leads to tracking, resulting in insulation breakdown across the insulator and pole fires.

6 EB-00-0 Exhibit C Page of In addition to line insulators, this program includes the washing of all switches, arrestors, terminators, transformer bushings and other circuit components, which may exist on the pole. The program is expected to result in reduced customer interruptions from insulation breakdown. 0 Underground Cable Chamber Infrared Inspection Routine inspection and maintenance of cable chambers is essential to improve underground system reliability and to reduce the cost for post fault cable replacement. Infrared scans and visual inspections of cable chambers are performed by a contractor on a ten-year cycle for locations outside of the downtown core. These chambers, where the majority of high voltage conductors operate at. kv, are accessed infrequently by THESL personnel. In downtown locations, the majority of high voltage conductors operate at. kv and are frequently accessed and inspected by THESL personnel as a part of routine capital or maintenance work. Approximately 00 cable chambers in the downtown core are selected for visual inspection every year. Starting in 0, THESL will begin a pilot inspection program to be performed by a contractor that will conduct an infrared scan of an additional 00 cable chambers in the downtown core. Depending on the success of the program, all future cable chamber inspection in the downtown core may include an infrared scan. 0 Overhead Plant Infrared Inspection Infrared inspection of overhead line components identifies hot spots which indicate loose, worn or ineffective connections and allows for corrective measures to be taken before these facilities fail and impact on system reliability. Electrical connections may become loose in time as a result of load cycling, contamination and physical fatigue. When the connection becomes loose, oxidation penetrates the connection surface. This oxidation offers high resistance to the flow of electricity resulting in heat built up at the point of contact that eventually melts and causes the line to become disconnected.

7 EB-00-0 Exhibit C Page of Infrared scanning of the overhead plant detects these hot spots and allows THESL to take corrective action under controlled conditions rather than responding to unexpected power outages. In 00, percent of the overhead plant was inspected and hot spots were detected. These hot spots have been corrected, thereby improving overhead system reliability performance. 0 Infrared/Ultrasonic Inspection and CO Cleaning of Pad-Mounted Switches The CO cleaning service involves the cleaning of pad-mounted switches which are typically installed on. kv feeders. This service work is initiated by the infrared, ultrasonic and visual inspection of pad-mounted switches, where the need for CO cleaning is identified to remove excessive built up of contaminants that may eventually lead to electrical tracking, insulation breakdown with flashover or hot spots on connection points. This program supports THESL s reliability initiatives to reduce or eliminate outages caused by flash-over within pad-mounted switches. In 00, planned inspection units were completed. These tests have found that 0 units required CO washing. This is an effective program to help maintain underground equipment performance. 0 Transformer Vault Washing This service involves pressure-washing both single-phase submersible and three-phase transformer vaults. Submersible vaults are smaller distribution vaults containing transformers and switches. They are typically installed below sidewalks and/or in boulevards. Three-phase transformer vaults are larger distribution vaults typically installed below sidewalks in the downtown district. Both types of vaults have ventilation grills installed on the surface and consequently are prone to dirt and contaminant build-up that can clog the vault drainage system. These vaults are pressure-washed to maintain equipment performance and system reliability.

8 EB-00-0 Exhibit C Page of 0 Contact Voltage Scan Electrical plant installed outdoors is constantly exposed to elements. It endures wide seasonal temperature variations as well as dirt, contamination and moisture ingress. Over time, physical connections or joints may be fatigued to the point that they breakdown resulting in live conductors making contact with metal or concrete housings. This creates a public safety hazard known as contact voltage. A typical example of such a failure is an exposed street lighting wire in a sidewalk handwell or inside a street lighting pole that causes the sidewalk or pole to be energized at a voltage up to 0V. In 00, contact voltage became a widespread emerging issue at THESL. Other large urban electrical distribution companies have experienced similar situations. The common preventive maintenance practice to maintain public safety is to conduct periodic contact voltage scans. 0 THESL has contracted a mobile contact voltage scanning company, Power Survey Company ( PSC ), to perform scans of THESL s distribution system. With mobile scanning, an electric field sensor is fitted to the back of a truck, which is then driven through the areas being surveyed. When a high field is detected, an alarm is sounded and an operator is directed to the source of the field to document the incident and initiate the repair process. Mobile scanning allows for all parts of the distribution system susceptible to contact voltage to be scanned in a fraction of the time that would be required for crews to visit these locations and manually test for voltage. This method of contact voltage detection has been certified to detect voltages as low as. V on any infrastructure within nine metres of the sensor. Mobile detection technology has been used by many utilities, in particular, Consolidated Edison ( ConEd ) in New York City has used it since 00. They currently own a fleet of mobile detection vehicles and perform complete system scans per year as

9 EB-00-0 Exhibit C Page of required by their regulator, the New York Public Service Commission. Feedback received from ConEd and other utilities using this technology is positive. SERVICE COSTS Table summarizes the total overall external services cost for the 0 test year, as well as the historical and bridge years. Table : Overall External Services Cost ($ millions) Service Historical Historical 00 Bridge 0 Test Civil Construction.... Tree Trimming.... Wood Pole Inspection Insulator Washing Infrared Inspection Overhead, Cable Chamber Infrared, Ultrasonic Inspection and CO Cleaning of Pad Mounted Switches Transformer Vault Washing Contact Voltage Scan Total Civil Construction Variance Civil construction costs for capital investment in 00 decreased by $ million compared to 00. However, 00 civil construction costs are projected to increase by $. million compared to 00 actual and there is an additional increase of $. million forecast in 0 compared to the 00 bridge year. The main causes of the increase are new emerging portfolio activities, and increased civil construction to support the higher sustaining capital program. The 0 numbers are based on the overall year-to-year Capital Plan increases.

10 EB-00-0 Exhibit C Page 0 of 0 Tree Trimming Variance Tree trimming program costs are projected to increase by $0. million from 00 to the 0 test year. This is primarily due to the anticipated higher contractor labour costs for the duration of a new three-year contract that is currently out for tender. An increase of $0. million from the 00 historical year to the 00 bridge year as there is an increase of approximately ten percent in feeder length being trimmed. The previous contract was for a three-year term from 00 to 00. The increase from 00 to 0 is approximately 0 percent. Due to a new contract being developed, THESL anticipates a ten-percent inflationary increase from the 00 historical year. In addition, THESL has also placed special emphasis on worst performing feeders with a history of tree-related outages allowing THESL to make the greatest impact to CHIs. Wood Pole Inspection Variance Costs for this activity generally are stable for the historical, bridge and test years. 0 Insulator Washing Variance The insulator washing program increases by $0,000 from the 00 historical year to the 00 historical year and a further $0,000 from 00 bridge year to the 0 test year, but these increases are masked by rounding. As THESL gathers recent information on pole fire locations, the data is compiled to create a more comprehensive insulator washing program. Infrared Inspection of Overhead Plant and Cable Chamber Variance The individual tasks of infrared inspection of overhead lines and underground cable chambers are being combined into one contract to promote more competitive pricing and improved quality of work. There is no significant variance between 00 and 0 costs.

11 EB-00-0 Exhibit C Page of 0 Inspection and CO Cleaning of Pad-mounted Switches Variance Infrared, ultrasonic inspection of pad-mounted switches and CO washing are also being combined into one contract to ensure better work coordination, and timely completion of deliverables to drive reliability improvement. The increase from the 00 historical year to the 00 bridge year is approximately $0,000 as more units are expected to be CO cleaned in the 00 bridge year. The 0 pad-mounted switch inspection and CO washing consists of two program initiatives, regular planned maintenance and Worst Performing feeder improvement with the aim of improving the reliability of worst performing feeders in the 0 test year. This program cost is forecast to increase slightly from 00 test year due to the Worst Performing Feeder Initiative. Transformer Vault Pressure Washing Variance The Transformer Vault Pressure Washing program cost has remained stable from 00 to 00. There was an increase of $0,000 in 00 as new contracts were negotiated, which caused the rounded numbers to increase from $0.million to $0. million. The large increase from the 00 bridge year to the 0 test year is primarily due to an increased amount of vault washing target specifically for worst performing feeder locations that are in addition to the normal maintenance cycle. This will help in improving the overall reliability of the system. 0 Contact Voltage Scan Variance The external contact voltage scan is expected to continue into 0. The estimated cost of this service is $. million to scan all areas of the distribution system at a rate of four times a year where contact voltage can appear. Efforts are maximized during the fall and winter months when the probability of contact voltage incidents is greatest. The 00 historical year was the start of this program. Contact voltage was an emerging issue in 00 and large amounts of internal and external resources were spent at that time. External contractor includes scans completed by external contractor and repairs made to

12 EB-00-0 Exhibit C Page of any defects. The increase of 0. million from the 00 bridge year to the 0 test year is attributable to increasing patrol areas due to the success of the program to date.