ENERGEX Network Management Plan Part A 2008/09 to 2012/13 FINAL

Transcription

1 Part A 2008/09 to 2012/13 FINAL

2 ENERGEX Limited, Australia This work is copyright. Material contained in this document may be reproduced for personal, in-house or noncommercial use, without formal permission or charge, provided there is due acknowledgment of ENERGEX Limited as the source. Requests and enquiries concerning reproduction and rights for a purpose other than personal, in-house or noncommercial use should be addressed to the Group Manager Corporate Communication, ENERGEX, GPO Box 1461, Brisbane, Queensland, August 2008 (v76)

3 TABLE OF CONTENTS 1.0 INTRODUCTION AND CERTIFICATION BACKGROUND NMP Background and Purpose Context of the NMP Corporate Strategy Business Key Result Areas Pillar One Priorities Pillar Two Priorities Legislative Environment Introduction Queensland Electricity Act and Regulations Queensland Electricity Industry Code National Electricity Scheme, National Electricity Law, National Electricity Regulations and National Electricity Rules Queensland Electrical Safety Act and Regulation Integrated Planning Act and Regulation Financial Environment Current Regulatory Framework Future Determinations NETWORK OVERVIEW Network Composition and Operational Boundaries Defining Network Characteristics Network Statistics Initiatives to Support ENERGEX s Future Vision ENERGEX S Future Vision Customer Participation and Business Sustainability New Technology Environment OPERATING ENVIRONMENT AND GROWTH FORECASTS Economic Forecasts Global Economics National Economics State Economics Government Policies South East Queensland Regional Plan Climate Change and Climate Smart Federal Government Renewable Energy Policy Queensland Government Solar Bonus Scheme Smart Metering Energy Consumption Forecasts Energy Consumption Forecast Methodology Energy Consumption History and Forecast for 2008/09 to 2012/ System Maximum Demand Maximum Demand Forecast Methodology Temperature Sensitive Load and Air-conditioning Growth Maximum Demand History and Forecast for 2008/09 to 2012/ PLANNING POLICY AND COMPLIANCE Planning Objectives and Legislative Requirements...33

4 5.1.1 The Code s Reliability Standards The Rule s Network Performance Standards Planning Policy Background Planning Terminology Previous Planning Policy - Reliability Assessment Planning Current Planning Policy Fundamentals Security Planning Criteria Planning Process Network Strategic Development Plan Load Forecasting Network Development Plan Detailed Planning Policy Compliance Network Strategic Development Plan Load Forecasts Network Development Plan Detailed Planning ASSET MANAGEMENT POLICY AND COMPLIANCE General Maintenance Strategies Time or Usage Based Preventative Maintenance Inspection and Condition Based Maintenance Demand Based Maintenance Re-design or Asset Retirement Substation Asset Maintenance Policy Mains Asset Maintenance Policy Public Lighting Assets (Streetlights) Vegetation Management Maintenance Management Maintenance Works Management Operating Investment Plans Inspections Planned Maintenance Corrective Repairs Emergency Repairs Operations Management Network Operations Customer Service Maintenance Policy Compliance Internal Maintenance of Oil Filled RMUs Internal Maintenance of 11 kv Step Voltage Regulators (SVRs) Maintenance on Some Non-Critical Protection Systems Maintenance Developments Maintenance Processes Review Emerging Maintenance Issues Unitised Air Break Switches (ABSs) DEMAND MANAGEMENT Introduction Demand Management as an Alternative to Network Augmentation ENERGEX Peak Demand Condition Demand Management Strategies Demand Management Programs Existing Network Support Programs Existing Residential Programs and Results...52

5 7.3.3 Planned Programs Future Challenges Air Conditioning Growth State Hot Water System Rules Future Opportunities Power Factor Correction and kv.a Tariff /08 GENERAL PERFORMANCE /08 Summer Preparedness Plan Capital Investments for Growth, Reliability and Security Capital Expenditure for 2007/ Overview of Capital Expenditure Outcomes Operating Investments for Network Maintenance, Safety and Reliability Operating Expenditure for 2007/ Overview of Operating Expenditure Outcomes Asset Utilisation Zone and Bulk Substations and 110 kv Feeders kv Feeder Utilisation kv Feeder Utilisation Distribution Transformer Loading Asset Refurbishment Asset Inspection and Refurbishment Programs Ring Main Units Overhead Copper Conductor Replacement Streetlight Main Recovery Distribution Transformer Replacement Program Power Quality Power Quality Performance Monitoring Voltage Enquiries (Complaints) National Power Quality Survey Power Quality Proposals Substation Power Factor Other Areas Guaranteed Service Levels Contingency Planning Resourcing Strategies FIVE YEAR HISTORICAL RELIABILITY PERFORMANCE Introduction Reliability Performance Urban and Rural Historical SAIDI and SAIFI Urban and Rural Feeder SAIDI Geographic SAIDI Reliability by Hub Reliability Analysis Storm Season Severity System Outage Causes % Feeder Improvement Program /08 Review Reliability Reporting Code Requirements Audit Results Accuracy...82

6 10.0 RELIABILITY IMPROVEMENT PROGRAMS Reliability Planning Criteria Reliability Improvement Principles The Code s Reliability Targets for the Next Five Years Minimum Service Standards Guaranteed Service Levels Existing Reliability Improvement Programs Rural Reliability Program Feeder Improvement Programs Planned Reliability Improvement Programs Short Term Reliability Initiatives Longer Term Reliability Initiatives Capital Expenditure Initiatives Five Year Capital Expenditure Program (2008/09 to 2012/13) Capital Expenditure Targets Network Refurbishment Operating and Maintenance Expenditure Initiatives Five Year Operating Expenditure Program (2008/09 to 2012/13) Operating Expenditure Targets Inspections Planned Maintenance Corrective Maintenance Storms and Emergency Response Vegetation Management Public Lighting (Streetlights) Other Operating Initiatives RISK MANAGEMENT OF MAJOR CONSTRAINTS Approach Building for Security, Quality, Reliability and Availability Security Risks Bulk Supply and Zone Substation Security /110/33/11 kv Feeder Security Substation Land Acquisition and Powerline Easements Power Transformers Distribution Transformers Network Contingency Planning Overview Contingency Plans for Summer (System Normal Conditions) Contingency Plans for Summer (N-1 Conditions) Power Transformer Contingency Plan Mobile Generators for Emergency Response (N-1 Conditions) Mobile Generators for NDM Support (System Normal Conditions) Emergency Response Procedures Safety and Amenity Substation Security Cranes/Plant and Persons Operating Within Exclusion Zones Wires Down Events APPENDICES Appendix 1 Network Basics Appendix 2 Terms and Definitions Appendix 3 Project Status for 2007/08 Program of Work Appendix 4 Major Projects Scheduled for Completion in 2008/

7 1.0 Introduction and Certification Electricity supply is an essential service that impacts on a region s prosperity and the lifestyle and comfort of its residents. ENERGEX, as the state government owned distributor of electricity in South East Queensland, effectively belongs to the community it serves. It is charged with the responsibility for delivering that service at a high standard and reasonable cost. This Network Management Plan (NMP) has been prepared to explain how ENERGEX is managing the network to meet customer and shareholder aspirations. It provides an insight into the complexity of managing a large modern electricity distribution network and describes the challenges that the organisation faces in a changing environment. The NMP is a requirement of the state government s Electricity Industry Code (the Code). It is carefully reviewed by the Queensland Competition Authority (QCA) and is available to the public via ENERGEX s and QCA s internet site. This NMP continues to implement the recommendations contained in the Independent Panel s Report Electricity Distribution and Service Delivery (EDSD) for the 21st Century (2004). Although the acquisition of full N-1 capability is continuing, network capacity and security has significantly improved over time and residual risks are being managed through operational measures. All of the other EDSD recommendations have now been physically completed or are on schedule for completion in future works programs. The recently released Report on the Operational Review of Queensland Electricity Distributors, commissioned by the Queensland Government, showed ENERGEX s progress in a wide range of service delivery areas against the 2004 EDSD report. South East Queensland is experiencing continued strong population and economic growth which is expected to increase electricity demand. Weather conditions also contribute to electricity demand but are more difficult to forecast, and the installation of domestic air conditioners is continuing to drive growth in the summer maximum demand. Despite recent mild summers, the forecast is for a strong underlying demand growth in the short to medium term. Rises in winter peak demand growth above national averages in recent years further support the underlying growth forecasts. Recent government action on infrastructure investment, particularly associated with water, transport and rail facilities, has also added to these pressures. Accommodating these changes and the region s notorious storm hazards has been and remains a continuous focus for ENERGEX s activities. Network security is forecast to be lower in 2008/09 for some network elements before improving towards the end of the five year plan. This should be viewed in the light of significant improvements during earlier years. The reduction is primarily due to the delayed completion of the 2007/08 capital works, localised unexpected demand growth in excess of forecasts, and reprioritisation of works resulting in some adjustment of project timings to meet customer requirements and manage network risk according to internal governance policy. It is not expected that this reduction in network security will have significant impacts on customer reliability as each risk is treated using site specific contingency plans and operational strategies. The network security risks need to be further improved to comply with ENERGEX policies and hence, ENERGEX s submission to the Australian Energy Regulator for the next determination may be seeking additional funds for this purpose. ENERGEX is focused on the quality of service that it provides to its customers. There are a range of goals covering issues such as security of supply, reliability, power quality and environmental care. Augmentation programs involving extensive capital works are being continually run to improve capacity and security across the network. A program incorporating the installation of intelligent remote controlled switchgear has commenced as part of a sustained effort to improve feeder reliability. Increasing focus is also being applied to the issue of power quality to ensure that ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 1

8 customers expectations are satisfied. Finally continual improvements are being made in areas such as vegetation management, land care and water use, to reduce the impact that electricity distribution places on the environment. ENERGEX has continued to invest heavily on network upgrades to meet growing customer demand. ENERGEX experienced significant growth in the new homes and businesses connecting to the power grid in the 2007/08 financial year. This in itself would be a major challenge, but at the same time there is also a continuing rise in the power being used by existing customers, especially as a result of increased use of air conditioning for heating and cooling. Over $3.5 billion has been spent during the past four years, to increase capacity by over 3,000 MV.A, effectively a 50% increase on the 2004 capacity levels. In excess of $6.7 billion is planned to be spent over the next five years on maintaining, improving and extending the network. Maintenance and operational spending on the network will continue at record levels with almost $1.7 billion allocated over the next five years to ensure security and reliability levels continue to be maintained and improved in South East Queensland. Specifically, in the last 12 months there has been progress in many areas. These included: commissioning of six new zone substations; augmentation of capacity at 18 zone substations to increase net capacity by 552 MV.A; construction or augmentation of kv feeders; construction or augmentation of kv feeders; installation or replacement of 403 distribution transformers; replacement of kv ring main units to improve safety and network reliability; replacement of 80.5 km of 11 kv 7/0.064 conductor and 30.1 km of LV 7/0.064 conductor for network reliability; installation of 154 line fault indicators and 40 cable fault indicators to improve fault response times; and installation of 15 pole mounted reclosers and 52 sectionalisers to improve reliability of supply. During the coming year, further progress will be made in the following significant areas: construction or augmentation of bulk supply substations to increase capacity by 120 MV.A; construction or augmentation of zone substations to increase capacity by 705 MV.A; construction or augmentation of one 110 kv feeder; construction or augmentation of kv feeders; construction or augmentation of kv feeders; upgrading or replacement of 445 distribution transformers; replacement of kv ring main units to improve safety and network reliability; replacement of 120 km of 11 kv 7/.064 conductor for network reliability; installation of 316 line fault indicators and 79 cable fault indicators to improve fault response times; and installation of 57 pole mounted reclosers, 43 sectionalisers and 215 load transfer switches to improve reliability of supply. Part A of the NMP provides a detailed description of ENERGEX s plans for the future, its performance over the last 12 months, and various aspects of the business that impact on its success. Capital and operating expenditure is described together with an analysis of the risks facing the business and alternate strategies such as demand management. Part B contains a comprehensive analysis of network assets such as substations and feeders with existing and forecast capacity details. It provides an important addendum to the main document and also ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 2

9 serves as notification of any network limitations in accordance with Clause 5.6.2(e) of the National Electricity Rules. This NMP is presented in accordance with the requirements of the Electricity Industry Code. This final version was provided to the QCA on 31 August 2008 and incorporates QCA feedback on the earlier draft. We hereby certify that: this NMP meets ENERGEX s obligations under its Distribution Authority No. D07/98; this NMP accurately represents the relevant policies of ENERGEX; ENERGEX has complied with those policies and/or provides details of where it has not complied herein; and ENERGEX is committed to implementing this NMP. Terry Effeney Chief Executive Officer Chris Arnold General Manager Network Performance ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 3

10 2.0 Background 2.1 NMP Background and Purpose The NMP s purpose is to keep the community and other stakeholders informed about ENERGEX s South East Queensland electricity distribution network and the actions being taken by ENERGEX to develop and maintain the network. ENERGEX has developed this NMP as part of its commitment to providing a reliable, safe and cost effective supply of electricity to South East Queensland. ENERGEX s approach to asset management integrates several key objectives, including delivering customer service and network performance to meet the required standards, the provision of a safe workplace for staff, safe networks for the community and a highly competitive cost structure to provide adequate commercial returns to shareholders. The approach adopted by ENERGEX in this NMP is to focus on operating and capital works to provide specific network performance outcomes. In some cases, demand growth is being answered with projects requiring significant capital investment in new infrastructure. These projects are complemented by capital works aimed at improving network security and reliability to the required standards. Network Demand Management (NDM) options are also considered where appropriate. Last but not least is an extensive maintenance program designed to ensure that the existing network meets specific reliability and safety targets. This multifaceted approach is a necessary strategy that carefully balances new works and maintenance to ensure that the network continues to meet customer requirements in a safe and cost effective manner. 2.2 Context of the NMP Corporate Strategy ENERGEX corporate strategy has identified key pillars aligned with regulatory determination periods. Pillar one covers the period to 2009/10 and delivers immediate priorities. Its focus is on ENERGEX securing control of its operations and delivering immediate outcomes in customer and worker safety, network reliability and delivery of the planned program of work for the business. This is needed as a foundation for building future network, financial and resource sustainability in a new regulatory environment. Pillar two covers the period from 2010/11 to 2014/15 and will target sustainability outcomes in the areas of customers expectations, financial performance, network/asset performance and people/resource management Business Key Result Areas ENERGEX has established a set of balanced Key Result Areas (KRAs) that monitor progress towards the organisation s vision and purpose. Table 1 details the KRAs and the strategic objectives, against which specific strategies, initiatives and Key Performance Indicator (KPI) targets have been set. The KRAs have been chosen to progress not only financial results but other corporate priorities to maintain ENERGEX s reputation as a provider of excellent customer service, an employer of choice and a respected corporate citizen. Several of the corporate priorities in support of the KRAs are detailed in the sections below. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 4

11 KEY RESULT AREA Safety Business (Financial) Performance Network Performance Program of Work People Customer Service Community Compliance Environment STRATEGIC OBJECTIVE ENERGEX will achieve an injury-free workplace by creating a culture where each person (employees, contractors, and suppliers) truly believes that Putting safety first is a core value and that working safely is part of everyone s day-to-day activities. To meet business objectives, ENERGEX must deliver strong financial performance through the cost effective delivery of electricity to retailers, services to customers, and improved productivity. ENERGEX will work proactively with industry regulators to facilitate network funding outcomes that support core business operations. ENERGEX is striving to improve network performance and emergency response through improved network reliability, security and safety to ensure that it meets customer expectations for reliability in urban, rural, and CBD areas. ENERGEX must also meet its Minimum Service Standards. ENERGEX must deliver its Network Management Plan and Summer Preparedness Plan commitments to ensure that the continued operation and growth of the distribution network meets stakeholder requirements. ENERGEX is committed to building an organisation that people want to be a part of. ENERGEX aims to develop a culture that is high performing and driven by corporate values. The business must ensure that it has the appropriate number of skilled and engaged employees to achieve the POW and other objectives that will deliver operational success. ENERGEX aims to achieve network performance outcomes and customer service improvements to meet or exceed customer expectations. A customer driven approach will be coupled with strong network performance to deliver high levels of customer satisfaction. ENERGEX aims to be a good corporate citizen by engaging with its customers and the community to understand their needs and expectations. ENERGEX will foster a culture of compliance to deliver against its legal, corporate governance, and community obligations. ENERGEX has adopted a systematic approach to communicating compliance obligations to ensure that all staff understand their responsibilities in relation to compliance. ENERGEX will achieve a sustainable environmental position by delivering environmental compliance and maximising the use of environmentally friendly business processes. Table 1 - Key Result Areas Pillar One Priorities Safety ENERGEX is committed to an objective of being be an injury-free workplace. Current performance provides for improvement opportunities in this area. The business is implementing strategies to drive strong safety performance outcomes, in addition to introducing new processes, systems and associated behavioural change programs to increase safety awareness and responsiveness. ENERGEX has reinforced a focus on safety by nominating safety as its first priority, and instituting zero injuries as a key measure across the entire ENERGEX Group. In 2008/09, ENERGEX will deploy safety initiatives to support the safety of its employees, contractors and the community. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 5

12 Reliability The Code specifies Minimum Service Standards (MSS) for reliability of the network. The reliability performance for ENERGEX s urban and CBD categories is favourable to the MSS, whereas rural reliability is only marginally favourable to the MSS targets. ENERGEX has set the achievement of the MSS targets as a high priority, especially in rural areas, and will implement appropriate measures to ensure that the probability of meeting the targets is better than 90%. Program of Work Delivery The regulatory allowance for capital expenditure for the period 2005/06 to 2009/10 has increased to $3.4 billion in 2004 dollars. This level of expenditure places unprecedented demands on all aspects of the business from planning through to design and construction. ENERGEX has introduced a Program of Work (POW) governance process to ensure that the works program is managed in the most efficient manner. ENERGEX will undertake continuous process improvement focused on improving the POW delivery performance, particularly for transmission projects. The 2008/09 POW has been developed based on current forecasts with additional contingency projects identified to manage changing customer requirements or project delays. This will be supported by improved project reporting capability Pillar Two Priorities Initiatives to support the future vision in accordance with Pillar Two are discussed fully in Section 3.4. These longer term strategies include three main areas to support business sustainability. The first of these is customer participation which focuses on understanding customer requirements and developing services to meet their needs and expectations. The second area is new technology which will be the cornerstone of driving costs lower to ensure that the business maintains and improves its efficiencies. Finally, the environment must be protected to ensure sustainability for the future. New technology is already being introduced into the business in the form of Field Force Automation and the introduction of remote controlled distribution switchgear. A distribution management system upgrade to improve remote operator management of the network is also underway with control system hardware and software enhancements in train. Future development will include enhanced control room functionality offering outage management, switching management, electronic wallboards, online load flows for contingency management and load management. 2.3 Legislative Environment Introduction ENERGEX Limited is a Queensland Government Owned Corporation (GOC) charged with the responsibility for distributing electricity to customers in the south east corner of the state. The two shareholding Ministers to whom ENERGEX s board report are set by the GOC Act as the Treasurer and the Minister for Mines and Energy. ENERGEX operates in accordance with the various laws and regulations, the most significant of which are listed below. The Government Owned Corporations Act 1993; The Government Owned Corporations Regulation 2004; The Electricity Act 1994; The Electricity Regulation 2006; ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 6

13 The Electricity Industry Code 3rd Edition 2007; The Electricity - National Scheme (Queensland) Act 1997; The National Electricity (Queensland) Law as set out in the schedule to the National Electricity (South Australia) Act 1996; The National Electricity (Queensland) Regulations under the National Electricity (South Australia) Act 1996; The National Electricity Rules V ; The Electrical Safety Act 2002; The Electrical Safety Regulation 2002; The Queensland Competition Authority Act 1997; The Queensland Competition Authority Regulation 1997; The Integrated Planning Act 1997; and The Integrated Planning Regulation Queensland Electricity Act and Regulations The primary legislation governing the Queensland electricity industry is the Electricity Act and the Electricity Regulation. It is the Electricity Act that confers to ENERGEX the authority to operate as a distribution entity with a supply area covering South East Queensland. Other significant matters governed by the Electricity Act and Regulation include: Licensing of electricity industry participants and monitoring of licence compliance; Reviewing and making recommendations about standards and practices under the Act; Defining operational powers of electricity officers; Industry regulation including the settlement of disputes between electricity entities and other parties; Approval of standard customer contracts of electricity distributors and retailers and other customer service matters; Approval of electricity prices for non-contestable customers; Administration of electricity restrictions and electricity rationing procedures; and Technical aspects of distribution including allowable supply voltages. Many of these matters are statutory functions of the Regulator, who for the purposes of the Electricity Act is the Director-General of the Department of Mines and Energy (DME). The DME as Regulator, is responsible for creating the standards and codes for regulating the electricity industry in Queensland. It monitors compliance with the Electricity Act and generally administers the other aspects of the Act as listed above. Under the recent changes to the Act, ENERGEX has entered into a new tripartite relationship with its customers and retailers to deliver its business outcomes. This new relationship commenced with the introduction of Full Retail Competition (FRC) on 1 July 2007 and is reflected in Figure 1. Customer Standard or Market Contract Connection Agreement Retailer Coordination Agreements Distributor Figure 1 - ENERGEX Customer/Retailer Relationship Model ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 7

14 The relationship between ENERGEX and retailers operating in Queensland is managed through Standard Coordination Agreements between the parties. The agreements outline how ENERGEX and retailers interact to ensure their joint customers needs are met Queensland Electricity Industry Code In 2004, under the authority of the Electricity Act, the Regulator issued an Electricity Industry Code (the Code) to prescribe requirements relating to industry planning, reporting and service standards. Under the Code, Minimum Service Standards (MSS) and Guaranteed Service Levels (GSLs) were established to create service quality targets. Furthermore, the Code included a requirement for distribution entities to publish annual Network Management Plans. Such requirements are aimed at creating a more transparent system whereby all affected parties can be informed about the management of the distribution entity and its performance in meeting statutory performance objectives. In accordance with the Code, the NMP details how ENERGEX will manage and develop its supply network to deliver an adequate, economic, reliable and safe connection and supply of electricity to its customers over the next five years. It achieves this objective by providing an overview of the ENERGEX electricity network, network priorities and network management strategies. In particular, the NMP addresses the following topics specifically required by the Code: An explanation of the background to the NMP and its purpose (Section 2.0); General information about ENERGEX s supply network (Section 3.0); A description of the operating environment including growth forecasts (Section 4.0); A statement of ENERGEX s planning policy and a qualitative assessment of its compliance with that policy (Section 5.0); A statement of ENERGEX s asset management policy (including its current key programs) and a qualitative assessment of its compliance with that policy (Section 6.0); ENERGEX s demand management strategy, including a description of the existing and planned programs and opportunities for demand side participation (Section 7.0); An evaluation of ENERGEX s performance in the preceding financial year against the NMP for that year, including its implementation of major capital and operating and maintenance expenditure initiatives (Section 8.0); An analysis of the historical reliability performance for the previous five year period (Section 9.0); An explanation of how worst performing feeders are defined and a performance analysis of the worst performing feeders in the past financial year and of the worst performing feeders identified in the preceding NMP (Section 10.0 & Part B); A statement of the reliability targets for the next five years and a description of major existing and planned reliability improvement programs, including details of major capital and operating and maintenance expenditure initiatives (Section 10.0); A risk assessment of the major constraints in ENERGEX s network and how they may be alleviated (Section 11.0); and Any other matters reasonably notified by the regulator. Note 1 The section references above can only be interpreted as a general guide due to the overlap between some individual Code requirements. On 1 July 2007, responsibility for monitoring the performance of ENERGEX and its conformance to the Electricity Industry Code was transferred from the DME to the Queensland Competition Authority (QCA) in accordance with the 3 rd edition of the Electricity Industry Code. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 8

15 2.3.4 National Electricity Scheme, National Electricity Law, National Electricity Regulations and National Electricity Rules The Electricity - National Scheme (Queensland) Act 1997 (National Scheme Act) governs Queensland s participation in the National Electricity Market (NEM). It achieves this by legislating that the National Electricity (South Australia) Law and the National Electricity (South Australia) Regulations are applicable to Queensland. Under the National Electricity Law, the National Electricity Rules (the Rules) has been established by the Australian Energy Market Commission (AEMC) to further define the roles and responsibilities of entities operating within the electricity market. These legislative requirements and their mirrors in other states provide an effective national regulatory framework within which state authorities can compete and be compared. The National Electricity Law defines the responsibilities of the key participants in the national electricity market. In particular, the functions and powers of the Australian Energy Regulator (AER) and the National Electricity Market Management Company (NEMMCO) are described. It also gives the force of law to the National Electricity Rules which provide even more detail as to the operation and requirements associated with the national electricity market. This regulatory framework governs the operation of the national grid and is aimed at promoting competition to maximise efficiencies and minimise energy prices. The National Electricity Market Management Company (NEMMCO) administers and manages the market for both physical power dispatch and financial settlements and also has responsibility for power system security. It also undertakes the coordination of the planning of augmentations to the national electricity system. The AER monitors compliance with this suite of legislation by the registered participants. It is responsible for investigating possible breaches of the legislation and for initiating proceedings when breaches are detected. It also holds important economic regulatory powers. The Rules establish the QCA as the Jurisdictional Regulator in Queensland. The QCA regulates distribution network service pricing in accordance with the Electricity Act and the Queensland Competition Authority Act. During the timeframe of this plan, the AER will assume responsibility for some jurisdictional responsibilities from the QCA as a further move towards standardisation between the states. A derogation within the Rules deems Powerlink Queensland as the only state Transmission Network Service Provider (TNSP) thereby consigning ENERGEX s entire network to distribution status. As a registered Distribution Network Service Provider (DNSP), ENERGEX s obligations include ensuring that the network has sufficient capacity to meet customers needs whilst complying with the technical and reliability standards specified in the Rules and state legislation. A DNSP is required to assist Powerlink prepare its annual planning report with network load forecasts. It is also required to notify NEMMCO of network limitations and develop planning reports in accordance with defined Regulatory Tests to address these limitations. Under the Rules, augmentation solutions may include network or non-network options. Where proposals exceed $10 million, public consultation with other parties is carried out as part of the process Queensland Electrical Safety Act and Regulation Electrical safety matters, including licensing of electrical workers and contractors, are dealt with under the Electrical Safety Act and the Electrical Safety Regulation. These are administered by the Electrical Safety Office within the Department of Employment and Industrial Relations. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 9

16 2.3.6 Integrated Planning Act and Regulation The Integrated Planning Act and supporting Regulation has a significant impact on the development of the electricity network. The Act seeks to achieve ecological sustainability by coordinating and integrating planning at local, regional and state levels, managing the development process and by managing the effects of development on the environment. Under the Act, construction of new electricity infrastructure often requires a full impact assessment involving public consultation and negotiation. To accommodate the longer project delivery times due to such assessments, demand forecasting and project planning must often be initiated earlier than would otherwise be required. There may also be implications for cost and timing of construction of infrastructure due to design requirements imposed under planning approvals. 2.4 Financial Environment Current Regulatory Framework ENERGEX s regulated revenue is derived from the provision of Distribution Use of System (DUOS) services and excluded distribution services. For the term of the current regulatory period (2005/06 to 2009/10), DUOS services are regulated under a revenue cap framework set out in the QCA s Final Determination: Regulation of Electricity Distribution of April 2005 (the 2005 Determination). The framework establishes the maximum amount of revenue that ENERGEX can recover from customers through network charges. The annual revenue cap for each year is determined through a cost-linked building block approach as the sum of: An allowed return on capital, being the return necessary to achieve a fair and reasonable rate of return on the assets necessarily invested in the business; An allowed return of capital, associated with recouping the capital that has been invested in the business assets over the useful lives of those assets; and Efficient operating costs, including expected efficiency gains. Key features of the framework are set out in Table 2. Feature Description Form of Regulation Revenue cap, with an under and overs account. Subject to review conditional upon maximum demand and customer number thresholds. Cost pass-through for major unexpected changes and certain additional CAPEX works. Revenue from Distribution $3.93 billion 1 Charges (5 year aggregate) Cost of Capital Equity beta: 0.90 WACC: 8.50% Prices Retail price increases for franchise customers have been capped at CPI by state government decree. Contestable customer distribution price increases have been similarly capped at CPI + 4.5%. Opening Asset Value $4.31 billion 1 CAPEX (5 year aggregate) $2.71 billion 1 (min) - $3.43 billion 1,2 (max) OPEX (5 year aggregate) $1.27 billion 1 Note dollars. Table 2 - QCA Final Determination Key Features ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 10

17 Following a decision by the QCA in March 2007, ENERGEX has had its capital expenditure allowance for the regulatory period increased to $3.43 billion. In addition, ENERGEX is seeking to pass through costs associated with the development of systems and processes required for the introduction of full retail competition in Queensland. The QCA is yet to make a final decision on this application. Excluded distribution services, which are ancillary to those services provided by the network, are requested by retailers and paid for by customers on a fee for service basis. The costs for these services are regulated by the QCA through a framework established under the Electricity Distribution: Review of Excluded Distribution Services Final Decision of December Future Determinations In July 2010, the responsibility for the economic regulation of ENERGEX s regulated activities will be transferred from the QCA to the AER. Until 30 June 2010, which includes the time frame of this Network Management Plan, the QCA is expected to continue to oversee ENERGEX s regulatory performance in accordance with the QCA s Final Determination. ENERGEX is currently preparing a Regulatory Proposal for the period from , for submission to the AER in May The Proposal is governed by the amended NER and ENERGEX s objective is to prepare a submission that provides for a sustainable future and a balanced outcome for customers and shareholders. The Proposal will include verified 5-year forecasts and plans. It will provide revenue certainty that ensures the continued implementation of the EDSD recommendations and facilitates the continued distribution of safe and reliable electricity. In addition, the Proposal will seek control mechanisms that ensure there are no regulatory barriers to pursuing energy efficiency and demand side management initiatives that contribute to ENERGEX s sustainability objectives. In order to reduce the forecast network risk, it is possible that increased capital expenditure will be sought for the later years of this NMP. ENERGEX will be among the first electricity distributors to submit a Regulatory Proposal to the AER under the amended NER. The transition to the national regulator will see the consolidation of funding arrangements and the implementation of a number of nationally consistent guidelines, models and schemes. It will also result in the review and national alignment of ENERGEX s distribution activities. These tasks will proceed as ENERGEX, along with other members of the NEM, works with the AER to further develop the national regulatory framework. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 11

18 3.0 Network Overview 3.1 Network Composition and Operational Boundaries Based in South East Queensland, ENERGEX has over 80 years of experience in managing complex electricity distribution networks and now owns and operates one of the fastest growing electricity network in Australia. It provides supply to almost 1.26 million customers including 1.15 million residences, 108,000 commercial premises, 4,000 industrial sites and 7,900 rural properties. It manages electricity assets worth over $6.3 billion and has over 3,500 employees with a commitment to providing a reliable electricity network that is economically, socially and environmentally sustainable. ENERGEX is responsible for the distribution portion of the network between the power station and customer. It takes supply of electricity from Powerlink at Connection Points and distributes this via a sub-transmission and distribution system to customers throughout the region. Zone substations and distribution substations convert the voltages as necessary to minimise network losses and meet customers voltage requirements. ENERGEX also operates some distributed generation which supports this network during normal and contingency situations. The schematic representation in Appendix 1 shows a typical arrangement extending from power source through to the customer s point of supply. Providing electricity to a mixture of urban and rural zones, the ENERGEX electricity network is characterised by: Connection to Powerlink s high voltage transmission network at 29 connection points; High Density/CBD areas such as the Brisbane CBD, Gold Coast and Sunshine Coast city areas which are supplied by 110/11 kv, 110/33 kv, 132/33 kv, or 132/11 kv injection points; Suburban/Urban/Short Rural Feeder areas where 110/33 kv or 132/33 kv bulk supply substations are used to supply 33/11 kv zone substations; The Brisbane suburban areas close to the CBD which have extensive older, meshed 33 kv underground cable networks that supply zone substations; Outer suburbs and growth areas to the north, south and west of Brisbane which are supplied via modern indoor substations of modular design that enable further modules to be readily added; An increasing proportion of new network is comprised of underground mains (7% growth) compared to overhead construction (0. 4% growth); and New subdivisions in urban/suburban areas which are supplied by underground networks with padmount substations. Servicing such a diverse area across ENERGEX s distribution area is achieved with six hubs centred around geographical regions. These hubs provide regional asset and resource management and can respond promptly to local network outages. Figure 2 shows the boundaries of each hub. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 12

19 Figure 2 - ENERGEX Distribution Area by Hub Location ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 13

20 3.2 Defining Network Characteristics As Section 4.0 explains, one of the fundamental factors affecting the management of the distribution network in South East Queensland is the region s strong rate of growth. Not only is the population and electricity demand growing at above average rates, the growth has been consistently high for many years and is expected to remain so. Some of the issues arising from this sustained development are listed below: High population and customer growth; High regional economic growth; Large scale commercial and residential redevelopment in inner Brisbane suburbs; Three high density growth areas with significant commercial and high rise residential developments Brisbane CBD, Gold Coast and Sunshine Coast; High commercial and tourism growth; Urban and semi-rural sprawl into previously forested or farming areas (supply made available to 20,781 lots in 2007/08); Increased community infrastructure development on roads, rail, water, hospitals and educational facilities; A significant growth in new air conditioner loads which are increasing the summer load at a time when plant ratings are already adversely affected by higher temperatures; and Redevelopment of older low density areas to higher density. A second defining characteristic affecting the network is South East Queensland s climate and weather. Although located in a temperate zone, the region has some of Australia s highest incidences of lightning strikes, with Darwin being the only other Australian capital experiencing a higher exposure. Furthermore, the summer season is accompanied by severe storms where wind gusts in excess of 80 km/h are a common experience. Such weather extremes expose the network to direct damage and indirectly through overhanging vegetation or flying debris. Other aspects of the region s climatic conditions are summarised below: Some high rainfall areas with rapid vegetation growth; Periods of sustained high temperatures and high humidity; Salt spray in exposed coastal areas; and Major summer lightning and wind storm activity. 3.3 Network Statistics Table 3 presents a summary of ENERGEX s major electricity network assets and provides a guide to the growth sustained over the last 5 years: ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 14

21 Assets 2003/ / / / /08 Total Overhead and Underground (km) 46,549 47,780 48,860 50,217 51,349 Lines - Length of Overhead (km) Total 35,525 35,839 36,069 36,373 36,522 LV 14,812 14,842 14,875 14,893 14, kv 17,090 17,344 17,504 17,709 17, kv 2,020 2,034 2,059 2,091 2, /110 kv 1, , , ,680 1,638 Cables - Length of Underground (km) Total 11,024 11,941 12,791 13,844 14,827 LV 7,117 7,595 8,135 8,592 9, kv 3,131 3,402 3,666 4,207 4, kv /110 kv Other Equipment (Qty) Bulk Supply Substations Zone Substations Poles 587, , , , ,064 Distribution Transformers 38,365 39,572 40,826 42,261 43,420 Street Lights 243, , , , ,892 Customers 2 Domestic 1,052,590 1,077,850 1,101,455 1,126,875 1,147,615 Commercial 96,230 99, , , ,350 Industrial 4,344 4,249 4,155 4,089 4,070 Rural 8,045 8,035 7,984 7,975 7,970 Traction Total 1,161,220 1,189,555 1,216,460 1,244,560 1,258,015 Note 1 The increase in 132/110 kv line length in 2006/07 over previous reports is due to a data redefinition. Note 2 Figures for 2007/08 customer data to end March Table 3 - Summary of Major Assets 3.4 Initiatives to Support ENERGEX s Future Vision ENERGEX S Future Vision ENERGEX has developed a Network Vision for the year The vision aims to achieve a future participative network which delivers the most commercial outcome for the business while meeting increasing customer, community and environmental requirements. The drivers for the network vision are predominately technology, social values and environmental sustainability. The electricity network will connect extensive micro-grids and local distributed generation. Overlayed on the electricity network will be several communication networks for controlling and monitoring smart distribution and customer equipment. These networks, in conjunction with associated information and control systems, will improve the supply reliability and performance to match the increasing reliance and importance of electricity powering the ever increasing digital society. The electricity network will be self healing - a fault will cause the electricity network to reconfigure, restoring supply almost immediately. Communications to every customer will enable new products and services to be offered. Intelligent appliances will be all pervasive with real time monitoring and control. Intelligent and autonomous energy management of distributed generation, appliances and network supply will be available to ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 15

22 reduce overall energy consumption saving greenhouse gas emissions for a sustainable environment Customer Participation and Business Sustainability Technology, climate change and rising energy costs are likely to see more customer participation and interest in electricity supply in the future. Distribution generation and smart communication networks will allow customers more flexibility in the management of their energy needs. ENERGEX has recognised that these changes are real and imminent and has developed a business sustainability model to accommodate changing customer expectations and the business environment. Figure 3 below shows the major components of this strategy customers, sustainability, and risk management. Customers Customer Choice/ Community Engagement/Delivering Customer Expectations Sustainability Return on Assets/ Sustainable and Funded POW/Stable Balance Sheet/Efficient Operations/Resource Mgt/IT Systems/ Environment Vision 2025 Network Standards/ Min Services Stds/SAIDI & SAIFI/Capability and Capacity Risk Management The ENERGEX Challenge: Delivering a Balanced Outcome Figure 3 - Customer Participation and Business Sustainability In the future customer requirements will be important aspect in developing business and investment processes. Sustainable business models require that there is a market for the product/service. Therefore, customer requirements for distributed generation, demand and energy management, energy efficiency, carbon offset programs will need to quantified and tailored to specific customer segments. ENERGEX has embarked on an analysis of customer requirements and future business models New Technology ENERGEX is responsible for optimising the reliability, security and utilisation performance of the regulated electricity assets to ensure that both regulatory and corporate performance outcomes are achieved in a manner that is safe to the workplace and the public. A number of external influences stemming from technology advancements and environmental issues are driving ENERGEX towards building a more adaptive and connective network for the future. These influences include the introduction of controllable devices on the network, smart meter technology, the increasing emergence of distributed generation and a need to reduce peak demand to improve network utilisation. ENERGEX s Network Strategy will deliver a future intelligent network, to ensure the most commercial outcome for ENERGEX while meeting increasing customer choice and managing environmental requirements. A key deliverable of the Network Strategy in 2007/08 was the ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 16

23 initiation and development of the Network Vision and Architecture Plan. This will be used to guide the development of future NMPs. As part of the intelligent network initiative, ENERGEX is currently upgrading its Distribution Management System (DMS) in preparation for future 11 kv automation and enhanced control and management of the network. Two stages have been proposed as follows: Stage 1 - An upgrade of the existing hardware and software applications to enable expansion of the control system, especially into 11 kv feeder switch automation. The upgrade of the DMS is on schedule and to budget. Stage 2 Development of new or enhanced functions for outage management, switching management, electronic wallboards, online load flows for contingency management and load management. Stage 1 was completed in June 2008, and the functional specification is being prepared for Stage 2. Technology advances, increasing customer expectations and environmental issues are driving ENERGEX towards building a more adaptive and connective network for the future. These integrated electricity supply and communication networks are required to improve reliability, accommodate distributed generation, enhance demand and energy management, support smart metering and energy efficiency. ENERGEX has developed a strategic plan for expanding the fibre optic network into the future and is progressing a fibre optic implementation plan for the next seven years. Work has commenced on a complete Communication Architecture in conjunction with a Network Architecture Plan. In the Network Technology Plan 2005, a reliability improvement strategy was proposed. In the short term network reliability would be improved by reducing CAIDI through the use of automated network switches and in the longer term by reducing the network failures through new network architectures and designs. ENERGEX has commenced this strategy by choosing a mesh radio system for communications with remote controlled network switches to isolate faulted sections of network and restore supply to unfaulted sections and customers, thus reducing CAIDI. As part of improving the scheduling and dispatch of work to field staff, ENERGEX has implemented a Field Force Automation (FFA) solution which is expected to improve customer service and reduce response times to outages. The mobile computing technology will be progressively enhanced over the next few years to enable optimised work crew scheduling, real time switching management, improved service order management, online maintenance management and online document management ENERGEX will expand its existing demand management initiatives aimed at reducing peak demand, the primary driver of electricity capital investment, which over time will deliver a gradual lowering of the forward demand curve. These new technology initiatives are expected to be valued in the order of $400 million over the next five years. The benefits they will provide will be far and above this expenditure. They will enhance reliability, improve data acquisition and control capabilities and allow ENERGEX to respond more rapidly to system incidents. (100-DSS, IT/DMS-225, 40-comms, 15-tfr monitoring, 10-SCADA) Environment Through delivering its Environment Strategy, ENERGEX will produce an environmental position that is responsive to the community's expectations, including the Garnaut Report and state government proposals (e.g. Climate Smart 2050 Strategy), about how ENERGEX s operations ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 17

24 should be impacting the environment. A key factor in ENERGEX s continuing environmental progress will be the ability for the business to incorporate environmental management considerations into significant business projects as well as day-to-day operations. In addition to focusing on retaining its Australian Standard environmental certification, ENERGEX will build knowledge and capability to allow it to maximise its use of green energy and become carbon neutral as a corporate entity. The business is working with other industry participants to build environmental compliance capability and deliver increased efficiency through processes related to environmental management. ENERGEX recognises corporate sustainability as the way of business in the future and is firmly committed to adopting an industry leadership role in innovation and success in its environmental performance. The success of the strategy will be impacted by ENERGEX s ability to create cultural change to advance environmental and sustainability agendas throughout the business through the adoption of related policies and practices. This change will be facilitated through the establishment of Environment Committees. Key aspects of the Environment Strategy include: Continued Deployment and Monitoring of the Environment Compliance Plan This plan has identified the environmental risks associated with ENERGEX s operations and has initiated strategies to control these risks through site specific environmental management plans. This work will continue as plans are developed for individual premises and risk mitigation strategies are implemented and evaluated. Development and Deployment of the Carbon Footprint Plan ENERGEX has a project underway to calculate its carbon emissions and then will use this to develop a plan which will enable it to establish a base line of current environmental performance as well as build targets and strategies for the future. Develop and implement a policy for offsetting carbon emissions and replacement of vegetation cleared for infrastructure programs. These offsets include revegetation for koala, fish and biodiversity habitat. Central to ENERGEX s responsibility to future generations is its vision to work in partnership with the community towards sustainable behavioural change. Community groups will be involved in the implementation of offset programs where possible; and Develop and implement ENERGEX s Corporate Sustainability Strategy Framework. This will take ENERGEX forward as leader in the energy sector as a sustainable corporation. In 2007/08 ENERGEX made a submission to the Secretariat Garnaut Climate Change Review on the implications of the proposed policy. ENERGEX is very supportive of energy conservation and demand reduction to enable lowering emissions to reduce climate change impacts. ENERGEX is proposing to conduct a range of energy conservation and demand management trials and pilot programs such as the recent Cool Change trial. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 18

25 4.0 Operating Environment and Growth Forecasts 4.1 Economic Forecasts The understanding of underlying economic conditions and trends is intrinsic to forecasting demand for electricity because consumption depends directly on economic activity. The following is a brief review of underlying economic conditions that influence consumption of electricity in South East Queensland Global Economics In 2007, world economic growth of 5% was strong. Growth in Asia (including China) remained high and the Japanese economy grew at a moderate rate. Similarly, USA and Europe growth rates were steady. Inflation started to rise due to high commodity and energy prices. The expected GDP growth for 2008/09 has become more constrained due to the financial crisis in the USA which is spreading to other countries. Economic commentators are suggesting a USA downturn which may span over 2 years with growth around 0.5%. Similarly in Europe, a downturn is expected over the next couple of years with growth around 1.3%. Japan is expected to go into decline in 2008 and improve slightly in China and India remain the leaders in the economic stakes with growth rates around 8-9% National Economics Inflation has been lower than expected but there is now persistent pressure for it to rise to around 4%. Increasing energy prices, increasing costs due to the impact of climate change, increasing credit costs and China s propensity to retain a very low Yuan are all expected to impact inflation in the long-term. The future has become more volatile as seen with recent events. The outlook in the short term is for a contraction and its severity depends on how business confidence reacts to the financial credit crunch. A soft landing is anticipated with the world financial regulators reacting in a positive way to the constrained financial situation. The Australian economy has been resilient by relying on strong world growth, especially from China, Japan and USA. Demand for minerals has supported the domestic economy. This demand appears to have peaked but remains strong and is expected to do so for the next few years. As the supply-side improves and the demand-side becomes constrained, commodity prices are expected to level off and decline. The Current Account Deficit has increased to over 5.5% of GDP with imports growing by 8%. GDP growth was higher than expected at almost 4% in 2007 but the expectation for 2008/09 is only 2.7%, beginning a couple of years of low growth. Export growth remained strong at 4.0% as capacity constraints decreased. The housing market returned to growth but it is expected to be volatile for a few years as affordability and the credit squeeze takes effect. Domestic demand is expected to be volatile over the next couple of years with consumer confidence much lower than in recent years. It will be strongly influenced by interest rates changes and higher living costs. The recovery in farm production is weather dependant and again it looks like the drought will have an impact in the next few years. Overall the Australian economy has enough momentum to continue to grow at around 3% for the next couple of years as long as the demand for commodities remains strong. Beyond this period, it is expected there will be a period of decline until domestic confidence and demand return to previous higher levels and domestic demand again drives the economy. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 19

26 4.1.3 State Economics The mining boom has boosted the growth in Queensland s Gross State Product (GSP) to 6.4% in 2006/07. Unemployment remains at a record low of 3.5% while demand for skilled workers remains high. Household consumption rose by 5.6% and dwelling investment growth decreased to 5.7%. Business investment also increased by 47.5% and public sector investment grew by 62.3%. Retail trade eased in the 7 months to January 2008 resulting in an annual growth of 9.2% as consumers absorbed the interest rate increases, higher grocery costs and increases in energy and water costs. As shown in Figure 4, Queensland s population growth increased by 2.2% (90,636) in the 12 months to 30 Sep 2007, with contributions from interstate migration (26,985), overseas migration (33,696) and natural increases (29,955). Queensland population growth peaked in 2002/03 (2.4%) but has been slowly declining since. This will continue with minor variations depending on the strength of the dwelling cycle and mineral/primary production. South East Queensland (66% of state population) absorbed the majority of the population increase, with the Brisbane Statistical Division out-weighing all other areas and the Gold Coast demonstrating the highest growth rate at 3.5%. Population Growth (% p.a.) Qld SE Qld Growth 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% Figure 4 - Population Growth Queensland s population growth to 2017/18 has been forecast, together with a breakdown of associated domestic and C&I customer numbers for South East Queensland. Forecasts of total customer numbers to June 2018 have been presented in Figure 5. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 20

27 Total Metered Customer Growth (p.a.) 40,000 New Customers 35,000 30,000 25,000 20, Figure 5 - Total Metered Customer Growth 4.2 Government Policies South East Queensland Regional Plan The South East Queensland Regional Plan and the South East Queensland Infrastructure Plan and Program have been prepared by the State Government s Department of Infrastructure and Planning as primary instruments for guiding growth in the South East Queensland region. They have been prepared in response to the significant population growth over the past 10 years with a view to accommodating the expected high levels of growth in the coming 20 years. The identification of a future urban footprint, with restrictions on developments outside that zone is an important outcome of these plans. ENERGEX makes use of such plans to forecast where electricity growth will take place and to determine where assets can be best located to meet future consumption and environmental needs Climate Change and Climate Smart 2050 The Queensland Government announced ClimateSmart 2050 Queensland Climate Change Strategy on 3 June 2007 in response to forecasts that Queensland will experience significant adverse events as a result of future climate change. ClimateSmart 2050 establishes Queensland s long term goals and provides a platform for the government, community and industry to move to a low carbon future. The Garnaut Climate Change Review was commissioned by Australia's State and Territory Governments in April 2007 with a final report due by September An interim report was issued in February 2008 and it is clear that the introduction of an emissions trading scheme (ETS) will be the primary instrument for securing a reduction in greenhouse gas emissions. The introduction of an ETS will flow through to end use prices and promote measures that lower emissions. A variety of barriers may however, inhibit the uptake of low cost measures such as energy efficiency. ENERGEX actively promotes energy efficiency within its own business and with customers, and seeks sustainable ways to reduce the environmental impact of its operations. ENERGEX s ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 21

28 sustainability and environmental performance is discussed extensively in the 2006/07 Annual Report (pages 38 43). The report includes detailed information on ENERGEX s environmental actions which encompass climate change and greenhouse initiatives Federal Government Renewable Energy Policy In a move designed to reduce the generation of greenhouse gases, the Federal Government set a Mandatory Renewable Energy Target for Australia on 1 April The Office of the Renewable Energy Regulator was established to oversee the implementation of the measure, which under the Renewable Energy (Electricity) Act 2000, currently requires the generation of 9,500 GWh of extra renewable electricity per year by It is anticipated that proposed emissions trading and renewable energy targets will encourage the deployment of renewable generation technologies to the point of commercial competitiveness. There are at least two existing programs that support these initiatives. The first is a Solar Hot Water Rebate Program administered by the Australian Greenhouse Office (AGO). It provides rebates to householders replacing existing electric storage hot water systems with greenhouse friendly solar or heat pump alternatives. The second scheme is the Photovoltaic Rebate Program also administered by the AGO. It offers a means tested rebate for the installation of grid connected photovoltaic systems on residential properties, thereby encouraging the growth of distributed generation throughout the network. Although reducing greenhouse gas generation, such measures provide challenges to the electricity distribution sector due to their effects on the network. One outcome will be the reduction in demand management capabilities as the number of electric storage hot water systems decline. With renewable feed in tariffs based on net rather than gross photovoltaic generation, discretionary loads will be shifted away from daylight hours, possible exacerbating evening peaks. Voltage quality problems associated with high penetration levels of grid connected photovoltaics are another possibility for which consideration must be given. It may even be necessary to amend working procedures to ensure that safety is maintained when working on lines connected to multiple sources of renewable power. Figure 6 shows the significant increase in PV installations in ENERGEX s area of supply over recent years. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 22

29 Network PV Agreements Number Pre July / / / /08 Figure 6 - ENERGEX Photovoltaic Network Agreements Queensland Government Solar Bonus Scheme ENERGEX has been an active participant in the working groups assisting with the implementation of the solar PV feed-in tariff under the Queensland Governments Solar Bonus Scheme. ENERGEX has worked very closely with Ergon Energy and the DME in an intensive 3 month project for the practical delivery of the feed-in tariff by the intended date of 1 July ENERGEX is well prepared in its metering arrangements and customer connection processes to enable the Queensland Solar PV feed-in tariff to be effective from 1 July Smart Metering In April 2007, the Council of Australian Government (COAG) endorsed a staged approach to the national mandated roll-out of electricity smart meters to areas where benefits outweigh costs. Detailed cost/benefit analysis work on this issue is now under the jurisdiction of the Ministerial Council of Energy (MCE). The MCE is currently engaging in a public consultation process regarding this cost/benefit analysis. Energex (in close consultation with Ergon Energy) is participating in this process and is making submissions to the MCE as appropriate. 4.3 Energy Consumption Forecasts Energy Consumption Forecast Methodology The approach currently adopted by ENERGEX is a combination of statistically based time series analysis and the application of extensive knowledge and industry experience. Forecasts are separately formulated for each of the following segments: Residential; Commercial; Industrial; ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 23

30 Rural; Street lighting; and Traction. For each of the segments listed above, forecasts are obtained of the total customer numbers and the amount of energy usage per connection or customer. The forecasts of customer numbers and average usage per customer are then multiplied together to obtain total energy consumption for each segment. Total system energy is then simply the sum of each of the components. This is a market sector approach and provides a reasonable basis for constructing forecasts for total system energy use. Each segment is affected by different underlying drivers of growth. For example, population and income growth are generally of greater significance in driving energy use in the residential sector, whereas GSP growth is of more importance in the commercial sector. An understanding of these sensitivities gives the forecaster the flexibility to treat the different sectors independently, rather than taking a more generalised approach that results in some loss of useful information. This approach results in a more robust forecast. ENERGEX utilises forecasts of, and past trends of a number of variables as indicators of the likely movement in future energy consumption. These indicators include: Queensland Gross State Product (GSP); Australian Gross Domestic Product (GDP); Consumer Price Index (CPI); and Average Weekly Earnings. Currently, there are no direct weather inputs into the energy forecasting methodology Energy Consumption History and Forecast for 2008/09 to 2012/13 Growth in energy consumption lags demographic changes and economic conditions by some 9 12 months. Energy growth is forecast to remain strong over the next couple of years as shown in Figure 7. Unlike 2005/06, there was slightly negative electricity consumption growth in 2006/07 mainly due to the mild summer period. Similarly, 2007/08 experienced constrained growth primarily due to mild weather. It is anticipated that in the long term the growth rate will slow due to increased efficiency appliances, the decline in electric water heating penetration and usage, and the impact of new environmental regulation. Forecasts of Queensland GSP based on information from Queensland Treasury, the Office of Economic and Statistical Research, QIC and economic consultants have been made out to 2017/18. The forecast GSP figures are a key input into the forecasting process used by ENERGEX for energy forecasting. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 24

31 Electricity Consumption Growth (% p.a.) 8% 7% 6% Actual Forecast Growth 5% 4% 3% 2% 1% 0% -1% Figure 7 - Total Electrical Energy Consumption Growth Domestic energy consumption is growing at a faster rate than in the 1990s. This change is indicative of a strong growth in the domestic area but will subside when economic activity declines and appliance penetration saturates. The trend of declining household occupancy and increasing average consumption is still expected to continue for a number of years, after which consumption will stabilise and grow in line with customer numbers. Consumption of electricity for water heating has slowed and will continue to do so for several reasons, including mild weather conditions, an increase in unit construction and of the directive for solar, gas and heat pump hot water heating in all new Queensland dwellings. Forecasts for C&I customer growth is related to expected changes in Gross Domestic Product and the trend in increasing average consumption. Commercial customer numbers are growing at around 2.4% p.a. while industrial customer numbers are slowly declining. Energy usage for C&I customers is increasing at 4.4% p.a. Figure 8 provides a graphical representation of this growth. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 25

32 GWh Electricity Consumption Domestic Load Hot Water Load Commercial Industrial 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, Note /08 and beyond are forecasts. 2007/08 values not available at time of publication. Figure 8 - Electricity Consumption by Category 4.4 System Maximum Demand Maximum Demand Forecast Methodology Consulting firm ACIL Tasman was engaged to review the methodologies used by ENERGEX to develop its range of long term forecasts. The scope of works required in the review included: 10 year system demand forecasts; 10 year zone and bulk supply substation demand forecasts; 10 year customer number forecasts; 10 year energy forecasts by customer segment and connection points; and 10 year 11 kv feeder demand forecasts. ACIL Tasman identified a number of improvements for each forecast and provided a basic methodology including a number of enhancements for implementation by ENERGEX. Some of these recommendations have already been applied including the following: Use of Amberley temperature data with its long term continuous history; Use of maximum and minimum temperatures rather than simple averages; Use of a Monte Carlo approach to determine 50 PoE and 10 PoE maximum demands; Use of an econometric model for the system demand forecast; New formats for the zone and bulk supply substation forecasts; and Use of census population data to support zone substation growth rates. ENERGEX is now using Amberley temperature in all long term forecasting due to the reliable historic set of temperature data. The long term average temperatures for Amberley as indicated in Table 4 are slightly higher than the Archerfield figures previously used ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 26

33 Temperature Probability of Exceedence Summer Daily Simple Average Temperature (T max +T min )/2 Winter Daily Simple Average Temperature (T max +T min )/2 10 PoE C 9.98 C 50 PoE C 8.65 C 90 PoE C 7.28 C Table 4-10, 50 and 90 PoE Amberley Temperatures The methodology proposed by ACIL Tasman has been implemented in this system demand forecast and incorporates the cooler summer data for 2007/08. The resulting model incorporates both economic, temperature and daily parameters such that Demand = fn (GSP, Maximum temp, Minimum temp and Friday loads) The process used to develop the system demand forecast as recommended by consultants ACIL Tasman is as follows: Use summer load data for only weekdays with an average temperature > 23.5 C, excluding public holidays and three weeks at Christmas; Develop a multiple regression equation for the last 5 summers; Run a Monte Carlo simulation with this equation using 55 years of temperature data from Amberley; Extract the maximum demands for each of the 55 summer periods; Select the 10th, 50th and 90th percentile of the maximum demands as the 10, 50 and 90 PoE values; and Use the forecast GSP and increasing temperature sensitivity to modify the coefficients for the 10 years of the forecast period. The end result of the analysis using this methodology is a much narrower band between the 50 PoE and 10 PoE and the 50 PoE and 90 PoE forecast maximum demands. ENERGEX is continuing to revise its forecasting methods in line with other ACIL Tasman recommendations Temperature Sensitive Load and Air-conditioning Growth Summer 2007/08 in South East Queensland has been relatively cool and wet with only two genuinely hot days. There was only one day that approached the long term average daily temperature of 30.2 C measured at Amberley. The peak demand of 4,142 MW occurred on Saturday 23 February and when temperature corrected, exceeded the 90 PoE demand forecast. Figure 9 shows the number of days exceeding the standard temperature of 30.2 C. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 27

34 Days with Average Temperature > Average 30.2 Degrees at Amberley Work Days Non Work Days Number of Days / / / / / / /08 Figure 9 - Days above Standard Temperature Due to the cooler summer, the temperature sensitivity for summer 2007/08 shown in Figure 10 was MW/ C measured at Amberley, compared with MW/ C and MW/ C for 2005/06 and 2006/07 respectively. The general trend in sensitivity has continued to increase in a logarithmic pattern with the exception of the summer of 2007/08. It is anticipated that the temperature sensitivity of the ENERGEX demand will be approximately 175 MW/ C for a normal summer in 2008/09. Whilst the actual recorded peak demand in summer 2007/08 was lower than the previous summer peak, the underlying growth in customer connections has continued. The impact of an above normal summer will validate the extent of this continued growth and its influence on system demand. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 28

35 ENERGEX Summer Temperature Coefficients at Amberley MW / Degree C y = Ln(x) R 2 = / / / / / / /08 Note 1 In the equation of best fit, x = 1 for the first year and increments by 1 for each successive period. Figure 10 - Summer Temperature Coefficients The average temperature for the summer of 2007/08 measured at Amberley was 24.3 C and was well below the long term average temperature of 30.2 C. In essence the summer of 2007/08 was a relatively cool and wet summer below the 90 PoE long term average temperature values. In fact there were only 33 days that exceeded 30 C maximum temperature. A typical summer would have 54.2 days with a maximum above 30 C. The summer of 2005/06 had 77 such days. Figure 11 shows a comparison of hot days (> 30 C maximum temperature) for the past seven summers using Amberley temperature data. Average Number of Days with Maximum Temperature > 30 C at Amberley December January February Days 60 Days 64 Days 60 Days 77 Days Days 51 Days Number of Days Days 0 Long Term Average 2001/ / / / / / /08 Figure 11 - Number of Days with Maximum Temperature > 30 C at Amberley ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 29

36 Figure 12 shows the daily system demand and the daily temperature conditions measured at Amberley for the 2007/08 summer. The system maximum demand for 2007/08 was recorded at 4,142 MW on Saturday 23 February. The average temperature of C almost reached the 50 PoE value but the load was significantly below the 50 PoE forecast demand. The 24.3 C average temperature for the summer period was well below the 90 PoE long term average of C. ENERGEX Peak Demand and Temperature Range at Amberley - Summer 2007/08 Min Temp Range 90POE Temperature 50POE Temperature 10POE Temperature Average Summer Average MD MW 90POE Forecast Demand 50POE Forecast Demand 10POE Forecast Demand Degrees C /12/ /12/ /12/ /12/ /12/ /12/ /12/ /01/ /01/ /01/ /01/ /01/ /01/ /02/ /02/ /02/ /02/ /02/ /02/2008 MW Figure 12 - Temperature and Demand History Maximum Demand History and Forecast for 2008/09 to 2012/13 Figure 13 shows the actual system maximum demand for summer for the past 10 years and the next 10 year forecasts using the new ACIL Tasman methodology including summer 2007/08 data. Since 2001, ENERGEX has experienced summer peaks with a 5 year moving average growth rate of between 5% and 7%. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 30

37 ENERGEX Maximum Demand Forecast V Actual - Summer ENERGEX 50POE ENERGEX 10POE Summer Actual Temperature Corrected ENERGEX 90POE Maximum Demand (MW) Figure 13 - Historical Maximum Demands and Forecasts Figure 14 shows the five year moving average maximum demand growth rate. Since 2004, the maximum demand growth rate has increased from 5-6% to 6-7% with increased installation of domestic air-conditioning. Maximum demand growth rates are expected to remain in the higher range until the domestic air-conditioning market saturates. Internal analysis and a review of predicted saturation rates in South East Queensland suggest that this will not occur until Year Compound Growth Rate - Summer 8.0% 7.0% Compound Growth Percentage 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% Figure 14 - Five Year Average Compound Summer Growth Rate Summer 2007/08 has shown a considerable drop in average growth rates primarily due to the relatively cool and wet summer. The weekday maximum demand occurred on Friday 22 February and was recorded at 4,120 MW compared with the previous summer with a demand of 4,289 MW. The temperature corrected maximum demand using the ACIL Tasman methodology for 2007/08 ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 31

38 was 4,673 MW, a decrease of 0.91% over the 2006/07 summer, temperature corrected demand using Amberley data. It is important to note that the underlying demand for electricity has not abated due to the cooler summer and that the potential for the system to meet or exceed the forecast demands is dependent on the summer temperatures and the behaviour of the South East Queensland customers. For this reason, several hot summer days are always useful in allowing forecasting models to be recalibrated and the magnitude of latent temperature sensitive loads to be calculated. Table 5 summarises the actual and temperature corrected (50 PoE) demands based on Amberley data and associated maximum demand growths over the past five years. The average 50 PoE growth over the past five years has been 5.4%. Table 6 lists the maximum demand forecasts over the next five years based on the ACIL Tasman model using Amberley weather data and including the 2007/08 summer results. This table is based on weekday maximum demands. Demand 2003/ / / / /08 Actual (MW) 3,835 4,008 4,131 4,289 4,142 1 Growth (%) PoE (MW) 3,881 4,131 4,363 4,716 4,673 2 Growth (%) Note 1 System maximum demand occurred on Saturday 23 February. Weekday maximum demand for 2007/08 was 4120 MW on Friday 22 February. Note 2 Temperature correction based on ACIL Tasman methodology using seven years of summer readings to normalise. Table 5 - Maximum Demand Growth Forecast 2008/ / / / /13 Winter (50 PoE) 4,360 4,556 4,761 4,975 5,184 Winter (10 PoE) 4,529 4,725 4,943 5,144 5,353 Summer (50 PoE) 4,975 5,243 5,486 5,767 6,023 Summer (10 PoE) 5,244 5,515 5,779 6,048 6,308 Note 1 The new 2008/09 five year demand forecast was developed using Amberley data as recommended by ACIL Tasman and includes the impact of summer 2007/08. Note 2 Winter forecasts are for the winter in the first half of the displayed financial year. Table 6 - Maximum Demand Forecast (MW) ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 32

39 5.0 Planning Policy and Compliance 5.1 Planning Objectives and Legislative Requirements Both the Code and the Rules stipulate minimum standards that must be achieved by a distribution entity. These requirements are specific and define targets that can only be achieved with careful planning. They are taken into consideration during planning activities either as a driver to initiate development or as goals to be achieved whenever development proceeds The Code s Reliability Standards A range of reliability standards are specified in the Code. Minimum Service Standards (MSS), Guaranteed Service Levels (GSLs) and requirements for improving performance on the worst performing feeders are stipulated. These are described in Section 10.0 dealing with reliability programs The Rule s Network Performance Standards Schedule 5.1 of the Rules also lists a range of network performance requirements to be achieved by Network Service Providers. These quality requirements are no less important than the more easily recognised outage frequency and duration metrics specified in the Code. Accordingly ENERGEX s planning policy takes these performance requirements into consideration when considering network developments. Some of the requirements under the Rules are listed as follows: Magnitude of Power Frequency Voltage: During credible contingency events, supply voltages should not rise above the time dependent limits defined in Figure S5.1a.1 of the Rules. (For normal steady state conditions, a requirement of ± 6% for low voltage and ± 5% for high voltage of 22 kv or less is specified in the Electricity Regulations s 13) Voltage Fluctuations: A Network Service Provider must endeavour to maintain voltage fluctuation (flicker) levels in accordance with the limits defined in Figure 1 of AS :1991. Although a superseded standard, it is specifically referenced under a Derogation of the Rules (s ) applicable to Queensland. Voltage Harmonic Distortion: A Network Service Provider must design and operate its network to ensure that the effective harmonic distortion at any point in the network is less than the Compatibility Levels defined in Table 1 of Australian Standard AS/NZS :2001. Voltage Unbalance: A Network Service Provider must ensure that the average voltage unbalance measured at a connection point should not vary by more than the amount set out in Table S5.1a.1 of the Rules. In addition to these requirements, the Rules define minimum power factor standards. Section of the Rules provides a table of acceptable power factors that apply to ENERGEX s connection points with Powerlink. These are designed to minimise losses and hence generation capacity. Unless reduced through negotiation, such limits are used as planning criteria for new developments. ENERGEX s Supply and Planning Manual describes its planning policy with respect to power quality. This applies to all supply and distribution planning activities associated with the network. It describes strategies that customers can adopt to improve voltage quality, particularly with respect to the installation of equipment that has the potential to reduce power quality. It also considers the ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 33

40 230V standard associated with AS , noting that the Electricity Regulation requires amendment to legislate the new standard. 5.2 Planning Policy Background The objective of any electricity network operator is to safely deliver a safe, reliable and quality product to its customers. Impediments to such a goal include growth in energy demand, growth in peak power requirements, changing customer load patterns, ageing plant, human mishaps, disturbing customer loads and the weather. Intelligent planning attempts to account for this wide assortment of variables to determine when assets require augmentation. Programming augmentation too early wastes public resources that could be better utilised in other areas of need. Scheduling works too late exposes customers to reduced supply quality or an increased risk of contingency events. Balancing these opposing forces is therefore a multifaceted and often difficult task Planning Terminology There are several definitions essential to the understanding of the ENERGEX s planning philosophy. The first, reliability of supply is the probability of a system adequately performing under the encountered operating conditions. Whilst a performing network is often taken for granted, a system failure; whether it be inadequate voltage or a complete loss of supply is immediately noticeable. A reliable network that meets the required service standards is therefore an important objective. Reliability is dependent on two other measures; adequacy and security. Adequacy is the capacity of the network and its components to supply the electricity demand within acceptable quality limits. It requires that network components operate within their ratings whilst supplying voltage within statutory limits. Security is the ability of the network to cope with faults without the uncontrolled loss of load. Faults are inevitable and need to be dealt with in a controlled predictable manner. Achieving this is a complex task affected by many factors. Some of these include the implementation of appropriate fault isolating protection such as circuit breakers or sectionalisers to trip sustained faults and under-frequency relays to shed load during system generation problems. Redundancy of design is another characteristic of a secure network and relies on some service duplication to tolerate the loss of single components. When referred to as N-1 planning, it involves the deployment of N items of plant where only N-1 items are sufficient to service demand. Network configurations with adjacent sources of supply and remote controlled distributed switchgear or supported by operational strategies including generators and mobile substations offer alternative security options. Other techniques involve automatic load shedding and restoration software Previous Planning Policy - Reliability Assessment Planning Traditionally, most transmission and distribution networks have been planned to a deterministic (N- 1) standard, which maintains supply for a single credible network contingency (ie. fault). A highly interconnected network with sufficient excess capacity allows for the loss of an asset to be easily accommodated with adjacent elements, usually through the use of redundant power transformers or via load transfers to adjacent feeders and/or substations. In 1989, ENERGEX switched to a probabilistic planning methodology known as Reliability Assessment Planning (RAP) to achieve better asset utilisation. ENERGEX adopted RAP for network voltage levels of 33 kv and above. It was based on a reliability and risk trade-off approach to planning the network. This involved assessing the probability of a network contingency coinciding with a load in excess of the secure network ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 34

41 capacity to determine whether the risk of an outage was within acceptable limits. Expenditure was deferred if a cost analysis, based upon the probability of an outage and the cost of the consequential unsupplied energy, indicated that the investment was not financially justified. Between 1994 and 2004, this strategy deferred capital expenditure of around $1 billion whilst network utilisation (the ratio of peak loads to network capacity) increased to 75% the highest in Australia. RAP could not be sustained however, and two factors forced a change of strategy. The first was the changing pattern of customer loads. With the advent of cheap air conditioners in particular, the traditional short winter peak associated with heating loads was eclipsed by a burgeoning broader summer peak. In addition to the unrelenting growth of the network maximum demand, the seasonal change in the peak produced additional concerns due to the lower network ratings associated with the hotter summer months. This reduction in adequacy, coupled with the second factor, an abnormally severe storm season during the 2003/04 summer, resulted in unacceptable outages of extended duration. It became apparent that a different approach was warranted Current Planning Policy Fundamentals In 2004, following the EDSD recommendations, ENERGEX moved away from RAP towards a more deterministic N-1 approach for the network backbone whilst still preserving some of the probabilistic aspects of its previous approach. This policy is focused on increasing system security and improving adequacy through network augmentation or demand management schemes. This reliability focused policy is based on several axioms as follows. Requirements for security depend on customer type sewage pumping stations and large hospitals require far greater security of electricity supply than a roadside billboard. Load forecasting is a probabilistic exercise due to the many variables affecting future energy consumption and peak demand. Social, economic and political factors together with the weather have significant effects on electricity usage. Plant ratings depend upon their ability to discharge heat and are therefore appreciably affected by the weather, including ambient temperature and in the case of overhead lines, wind speed. In accordance with these factors, ENERGEX s current planning policy requires detailed assessments of network capabilities and the loads that it is expected to supply. There are many tasks involved in achieving this but some of the more important are listed below. Load centres are ranked according to customer class to establish a security level priority for all sites. Future loads are forecast for an average scenario (50 PoE) and a conservative scenario (10 PoE) that is based on the probability of the forecast load being exceeded. Significant network components (transmission feeders, bulk supply substations, subtransmission feeders, zone substations and distribution feeders) are rated for both steady state and short term capabilities for appropriate ambient conditions. A minimum required security level is assigned to significant network components according to the customer class that they serve. Given that reliability is affected both by the adequacy and security of the network, both parameters must be assessed to ensure acceptable performance. The planning policy uses the information derived from the tasks described above to carry out this reliability assessment using the following basic criteria. The normal cyclic capacity of any network component supplying any customer class must be greater than the conservative forecast load (10 PoE). Note that if the actual load ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 35

42 exceeds the conservative forecast, it can still be supplied by virtue of the higher short term or emergency ratings inherent in network components. For all but the lowest priority customer classes, the loss of a network component through planned or unplanned circumstances should result in a predictable supply outcome for an average forecast load (50 PoE) according to the security planning criteria detailed in Table 7. Some examples include: o no loss of supply to the CBD following two transmission feeder failures, o no loss of supply to a high density urban area following the failure of a single zone substation transformer, o a short (~ 15 minutes) loss of supply to a small tourism venture in the event of a subtransmission feeder failure and o a moderate (~ 2 hours) loss of supply to a rural township in the event of a zone substation transformer failure. If network reliability deficiencies are identified, network augmentation, load management programs, or projects aimed at enhancing system security are planned Security Planning Criteria Table 7 details the security criteria used by ENERGEX to plan its network. Under the planning guidelines approved by the DME, full N-1 security is not required at all substations. Where automated load transfer can be effected within 15 minutes of a contingency the network is considered to have effective N-1 capability. This is abbreviated as N-1(a). This policy means that ENERGEX can achieve higher utilisation and financial effectiveness than that achievable with a full N-1 network. A slightly lower level of security is achieved where manual load transfers can be effected within about 2 hours or less (N-1(b)). The achievement of the security standard detailed in Table 7 is financially onerous and it is expected to take up to two regulatory periods before the objectives can be realised. The implementation of the security planning criteria will reduce the Maximum Demand Utilisation (MDU) of the network to between 60 and 65%. This will provide an acceptable balance between network security and economic use of network assets. The following actions are being undertaken to achieve compliance: Each bulk supply and zone substation will be monitored and analysed on a yearly basis to ensure that there is sufficient transfer capacity to cover a single credible contingency (N-1). The transfer capability for each substation will be identified and upgrades undertaken to address any shortfalls. Plans for each substation are being developed and will be updated annually to ensure the network is capable of meeting a 10% Probability of Exceedence (PoE) (refer Section 4.4.1) forecast at each substation for system normal and 50 PoE forecast for an N-1 contingency and upgrades undertaken to address any shortfalls. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 36

43 SECURITY CATEGORY BY CUSTOMER CLASS CUSTOMER CLASS (Typical loads in brackets) Transmission Feeders Bulk Supply Substns Sub- Transmission Feeders Zone Substns Distribution Feeders 1. CBD N - 2 N - 1 N - 2 N - 1 N Essential Large (> 2 MV.A) N - 2 N - 1 N - 2 N - 1 N Industrial Very Large (> 20 MV.A) N - 1 N - 1 N - 2 (b) N - 1 N Commercial Large (> 5 MV.A) N - 1 N - 1 N - 1 N - 1 N Industrial Large (5-20 MV.A) N - 1 N - 1 N - 1 N - 1 N Tourism Large (> 5 MV.A) N - 1 N - 1 N - 1 N - 1 N Urban High Density N - 1 N - 1 N - 1 N - 1 N - 1 (b) 8. Urban Medium Density N - 1 N - 1 N - 1 (a) N - 1 (a) N - 1 (b) 9. Commercial Small (< 5 MV.A) N - 1 N - 1 N - 1 (a) N - 1 (b) N - 1 (b) 10. Essential Small (< 2 MV.A ) N - 1 N - 1 N - 1 (a) N - 1 (b) N - 1 (b) 11. Industrial Small (< 5 MV.A) N - 1 N - 1 N - 1 (a) N - 1 (b) N - 1 (b) 12. Tourism Small (< 5 MV.A) N - 1 N - 1 (a) N - 1 (a) N - 1 (b) N - 1 (b) 13. Rural Production (5-15 MV.A) N - 1 N - 1 (a) N - 1 (a) N - 1 (b) N - 1 (b) 14. Rural Township (> 15 MV.A) N - 1 N - 1 (a) N - 1 (a) N - 1 (b) N - 1 (b) 15. Urban/Rural Fringe N - 1 N - 1 (a) N - 1 (b) N N 16. Rural Farming (< 5 MV.A) N N N N N Note 1 16 customer classes distributed across nine security bands. DEFINITIONS N - 2 N - 2 (a) N - 2 (b) N PoE forecast load not to exceed ECC (or 2HEC if suitable load reductions can be implemented in the required time) for a credible double contingency. 50 PoE forecast load not to exceed ECC for a credible single contingency. Possible loss of supply for credible double contingency but adjacent network has excess capacity so all 50 PoE forecast loads can be restored by remote switching (< 15 minutes). 50 PoE forecast load not to exceed ECC for a credible single contingency. Possible loss of supply for credible double contingency but adjacent network has excess capacity so all 50 PoE forecast loads can be restored by manual switching (< 2 hours). 50 PoE forecast load not to exceed ECC (or 2HEC if suitable load reductions can be implemented in the required time) for a credible single contingency. N - 1 (a) Possible loss of supply for single contingency but adjacent network has excess capacity so all 50 PoE forecast loads can be restored by remote switching (< 15 minutes). N - 1 (b) Possible loss of supply for single contingency but adjacent network has excess capacity so all 50 PoE forecast loads can be restored by manual switching (< 2 hours). N 2HEC ECC NCC 10 PoE forecast load not to exceed 0.8 NCC for network intact. Possible loss of supply for single contingency for up to 12 hours while the network is reconfigured or repaired or mobile equipment is deployed. Two Hour Emergency Capacity of remaining equipment with largest parallel element out of service. Emergency Cyclic Capacity is the maximum cyclic rating of remaining equipment with the largest parallel element out of service resulting in an accelerated but acceptable rate of wear. Normal Cyclic Capacity is the maximum cyclic rating of all parallel equipment (may need to allow for unequal load sharing) resulting in a normal rate of wear. 10 PoE Forecast Load Peak load forecast which has a 10% probability of being exceeded in any year (ie. An upper range forecast likely to be exceeded only once in every 10 years). Based on normal expected growth rates and temperature corrected starting loads. 50 PoE Forecast Load Peak load forecast which has a 50% probability of being exceeded in any year (ie. A mid range forecast likely to be exceeded once every 2 years). Based on normal expected growth rates and temperature corrected starting loads. Note 1 The NCC for substations and feeders supplying any customer class must always be greater than the 10 PoE forecast load (ie. The probability of the peak load exceeding the normal cyclic capacity of a substation or feeder in any year is less than 10%). Table 7 - Security Planning Criteria increasing security increasing security ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 37

44 5.3 Planning Process ENERGEX has a four stage planning process. The first stage is the development of a Network Strategic Development Plan (NSDP) which describes the expected pattern of major electricity network development for the next 20 years if load densities and land use is maximised. The second stage involves Load Forecasting to determine the future demands expected of the network over the next ten years. Thirdly, a Network Development Plan (NDP) is prepared to describe projects in detail, with an appropriate schedule for implementation over a ten year period. Detailed Plans are then developed for individual projects to enable them to be implemented within the next two to three years Network Strategic Development Plan The major purpose of the Network Strategic Development Plan is: To provide a framework in which to develop the electricity supply network to maximise its economic life; To determine future land requirements and initiate early acquisitions to ensure inclusion in local council planning schemes; and To provide a means of communicating and coordinating electricity supply infrastructure requirements with other infrastructure providers (eg. local councils, Main Roads, Powerlink). The Network Strategic Development Plan identifies the approximate location of future substation sites and powerline corridors likely to be required to supply future expected load. It is based on council land use data from published town plans and reflects the South East Queensland Regional Plan. Loads are assigned to each land use category based on expected electricity usage so that spatial load forecasts over larger geographic areas can be derived. The optimum location for a substation and lowest cost network option is determined using an algorithm that minimises the sum of all loads multiplied by their distance from the proposed substation site. Potential feeder corridors are then identified to supply these new substations. Land is acquired for these substation sites and feeder easements in advance of network requirements, based on a balanced assessment of technical, social, environmental and economic factors. The Network Strategic Development Plan is nominally reviewed every five years, or more frequently if necessary. Triggers for review can include important technological innovations, major shifts in the political environment or community requirements or a significant change to a proposed or anticipated development within an area Load Forecasting A Network Forecasting Department is responsible for demand and energy forecasting for individual substations, connection points and for the entire network. In part, this analysis is also used as an input to Powerlink s planning processes for South East Queensland. Internally however, the assessment reveals future network limitations which require alleviation. Normal practice for most distribution utilities around Australia is to use a 50% Probability of Exceedence (50 PoE) forecast in planning the future capacity of a network. This methodology assumes that the major uncertainty in the forecast is ambient temperature and that in any one year there is a 50% probability of exceeding the long run median temperature. In layman s terms, a 50 PoE temperature corresponds to a typical summer weather pattern and results in a 50 PoE maximum demand. While this forecast could be exceeded every second year, it allows for orderly expansion of an optimum network. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 38

45 Many distribution utilities in Australia plan their network on an N-1 basis, to cater for one major network component to be out of service whilst still maintaining supply to customers. The network capacity required to cover single contingencies results in average utilisations of only 50 55%. This practice of having surplus capacity for a contingency also covers extreme weather events when the load exceeds the predicted 50 PoE forecast. Networks with extensive N-1 capability have sufficient capacity to handle extreme weather events quite comfortably. The higher the utilisation, the more difficult it is to cope with network contingencies and extreme weather events. To plan for extreme weather events, 10 PoE forecasts (which are not expected to be exceeded more than once in 10 years), have been developed for each bulk supply and zone substation. These forecasts are used to develop plans for each substation to cope with extreme weather events. The 50 PoE forecasts are used to develop contingency plans for single credible contingencies (N-1). Current planning criteria are best summarised as: The network under system normal conditions must be capable of sustaining a 10 PoE load forecast; and The network under effective N-1 conditions must be capable of sustaining a 50 PoE load forecast Network Development Plan Effective N-1 capability is an important measure of security and is reviewed annually as part of the development planning process. The major purpose of the next level Network Development Plan is: To identify and group future expected network limitations into projects; To prepare a list of capital projects for the next five financial years; To provide estimates of resource requirements for the next five years; and To prepare a headworks capital budget for the next five years. After each winter and summer, a maximum demand forecast is produced for each substation in the network. From these forecasts, a set of expected future network limitations is prepared detailing when the substations and feeders will need upgrading. The limitations are categorised and grouped to form the scope of capital projects. Each project is assigned a required by date and assigned to a financial year after which the capital budget is prepared Detailed Planning Each project identified in the Network Development Plan is subject to a detailed planning study. The detailed planning report develops various options to mitigate or solve the identified limitations and conducts a rigorous economic analysis to determine the most cost effective solution. This process ensures that network capital expenditure is prudent and commercially justified. In accordance with the network development requirements of the Rules, ENERGEX publishes details of its network limitations using the NMP as a convenient medium. Proposals to remedy any such limitations are then prepared and costed for several options using the AER s prescribed Regulatory Test methodology, complete with Net Present Value (NPV) analysis. For projects in excess of an estimated $10 million, a Consultation Report is published on ENERGEX s and NEMMCO s website to allow interested parties to offer comments and alternative solutions. Subject to consideration of these recommendations, a Final Report is published on ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 39

46 ENERGEX s and NEMMCO s website detailing the selected development proposal for implementation. Although smaller developments above $1 million and less than $10 million do not require public consultation, Final Reports based on similar Regulatory Test analyses are published via ENERGEX s and NEMMCO s websites. 5.4 Policy Compliance Network Strategic Development Plan In the last 12 months, the Network Strategic Development Plan was reviewed in response to a number of town planning changes. A review into the Park Ridge area commenced in the second half of 2007 and more recently the Rochedale and Taigum/Fitzgibbon areas was re-examined. These special reviews were completed by June 2008 and have resulted in changes to the Network Strategic Development Plan including new proposed substation locations within the areas of consideration. A new five year review of the Network Strategic Development Plan has just commenced starting with the Gold Coast area. Town planning contractors have been engaged to convert council land use data into standard ENERGEX land use data so that load densities can be assigned and a spatial load forecast derived. The Gold Coast review is expected to be completed later this year and the review will proceed to other ENERGEX areas Load Forecasts Energex produces a range of long term and short term demand and energy forecasts each year. During March and April, Energex has modified the forecasting methodologies used to produce these forecasts following an external review by ACIL Tasman. The purpose of this review was to improve the accuracy, effectiveness and efficiency of the forecasts. The forecasts produced over the past twelve months include: Ten year system demand forecasts; Ten year zone and bulk supply substation demand forecasts; Ten year customer number forecasts; Ten year energy forecasts by customer segment and connection points; Ten year 11 kv feeder demand forecasts; 12 month energy forecasts by customer segment; and 12 month demand and energy forecasts for major customers. The production of the new 10 year system demand and zone substation demand forecasts was completed as summarised in Table 8: Task Completion Finalise system demand forecast April 2008 Finalise summer zone substation validated maximum demands May 2008 Produce initial draft 10 year bulk supply and zone substation forecasts May 2008 Review, finalise and publish the 10 year substation demand forecasts June 2008 Table 8 - Major Forecast Outcomes ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 40

47 5.4.3 Network Development Plan ENERGEX has revised its procedures for the production of its five year Network Development Plans and has used these new procedure during the production of the current NMP. Further refinements to NMPs are envisaged as the NDP is revised in accordance with this procedure. As part of the NDP process, ENERGEX is also producing area plans that focus on how a bulk supply area should be augmented Detailed Planning ENERGEX has reviewed its procedures for the production of Project Approved Reports (PARs). The procedure has enabled this process to be made more effective, efficient and consistent. These procedures incorporate the requirements to undertake a Regulatory Test. With a large capital program of work, it has been necessary to set up a project management methodology to ensure that projects are approved in a timely manner to allow construction and commissioning prior to network requirement date for the project. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 41

48 6.0 Asset Management Policy and Compliance 6.1 General Maintenance Strategies ENERGEX develops and implements maintenance plans to provide a safe, reliable network that delivers an acceptable quality of supply and legislative compliance whilst achieving an economical asset life. There are two documents that describe ENERGEX s asset management policy; the Substation Asset Maintenance Policy (SAMP) and the Mains Asset Maintenance Policy (MAMP). The SAMP deals with substation based equipment (within the substation fence) and the MAMP applies to other transmission, sub-transmission and distribution assets such as overhead powerlines, underground cables and distribution transformers. The two policies define inspection and maintenance periods or cycle times for each type of asset together with an overview of the extent of maintenance to be undertaken. These policies are used as inputs to determine the 5 year Operating and Maintenance Program and Annual (detailed) Operating and Maintenance Plan. This plan is then in turn the basis for building up the annual Operating and Maintenance Program of Work (POW) and its associated budget. Both the MAMP and the SAMP are subject to continuous review to reflect the latest maintenance strategies. Maintenance requirements for ENERGEX assets are determined by consideration of mechanisms by which equipment can degrade and fail and the safety, environmental, operational and economic consequences of failure. Potential equipment failures are addressed by the most effective of the following four strategies Time or Usage Based Preventative Maintenance Equipment is either serviced or replaced at a fixed interval based upon usage or time in service. This approach is used where a relationship exists between the time in service or usage and an increasing likelihood of failure. Typical examples of scheduled restoration or replacement activities used by ENERGEX include: Maintenance of power transformer on load tap changers based upon the number of switching operations; and Maintenance of medium voltage bulk oil circuit breakers based upon the number of switching operations Inspection and Condition Based Maintenance Equipment is inspected at scheduled intervals for physical indications of degradation exceeding a threshold value that is predictive of an ongoing failure mechanism. Equipment is either restored to an as new condition or replaced. Typical examples of on condition restoration or replacement activities used by ENERGEX include: Periodic analysis of power transformer oil to determine the presence of trace gases produced by internal faults; Periodic examination of the extent of timber decay in wood power poles to determine residual strength; and Periodic visual inspection of timber crossarms to determine the presence of visible signs of timber decay. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 42

49 6.1.3 Demand Based Maintenance Equipment is allowed to run to failure. This approach is appropriate where either the consequences of failure do not present an intolerable safety risk, where alternative provisions exist to mitigate the consequences of failure and where allowing equipment to run to failure is economical. Typical examples of items allowed to run to failure by ENERGEX include: Streetlight lamps; and Underground distribution cables Re-design or Asset Retirement Equipment is either modified or replaced to improve the asset s inherent design. This approach is used in cases where the likelihood of equipment failure cannot be effectively managed through the above strategies. Examples of asset re-design or replacement used by ENERGEX include: Replacement of ageing oil filled Ring Main Units (RMUs); Replacement of concentric neutral screened service wires; and Replacement of certain types of overhead mains connectors. 6.2 Substation Asset Maintenance Policy The primary objective of the SAMP is to provide a satisfactory and predictable level of availability and performance of substation assets and equipment at a minimal cost. These assets would typically include: Ancillary equipment including exposed busbars, air break switches, isolators, neutral earthing resistors, batteries, capacitor banks and oil containment facilities; Audio frequency load control equipment; Ring main units; Circuit breakers and automatic circuit reclosers; Transformers and on load tap changers; Protection systems; Substation structures; and Substation property assets. The maintenance requirements for ENERGEX s substation assets are documented in the SAMP. In addition to the asset specific targeted inspection and maintenance programs, routine substation inspections are performed at six monthly intervals. These include evaluations of site security and signage, conformance to design standards, abnormalities (eg. oil leaks), communication equipment, tools, warning signs and general maintenance requirements (eg. cleaning). Some maintenance is triggered by condition based monitoring (eg power transformer oil) which achieves better results than simple time based maintenance. 6.3 Mains Asset Maintenance Policy The MAMP nominates required inspection and maintenance activities and frequencies for subtransmission and distribution assets generally outside of the substation fence. In addition, the MAMP details the necessary inspection and maintenance activities associated with external influences such as vegetation that may have impact on the network. Thermal imaging is also widely used to detect network components that are in need of maintenance, to allow them to be serviced or replaced before they result in network outages. The MAMP also details inspection and ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 43

50 maintenance requirements for sub-transmission and distribution assets which are documented in the MAMP for each specific asset type including: 132/110 kv overhead transmission assets; 33 kv/11 kv/lv overhead distribution assets; 110 kv/33 kv underground transmission assets; and 11 kv/lv underground distribution assets Public Lighting Assets (Streetlights) ENERGEX conducts inspections and replacement activities to ensure the serviceability of streetlight assets. Inspection activities include night-time patrols on main roads on a six week cycle and on minor roads on a 12 week cycle to identify defective lights. Patrols during daylight are conducted biannually to identify lights that remain on during the day, generally before and after the storm season when streetlights can be damaged by lightning activity. All defects found during patrols are programmed for repair Vegetation Management Vegetation in proximity to overhead powerlines presents significant risk to both safety and network reliability. To manage this risk ENERGEX employs the following strategies: A cyclic program, to cut vegetation on all overhead line routes with a cycle time of 2.5 years (30 months); A follow up program to cut all urban and selected rural high voltage routes after a mid-cycle period of 15 months; A visual tree assessment program aimed at identifying specific trees or branches posing a risk to overhead lines and resulting in additional tree and overhang removals on a targeted feeder basis; and Reactive spot activities to address localised instances where vegetation is found to be within clearance requirements. ENERGEX is also working cooperatively with local councils to reduce future conflict between trees and powerlines. Initiatives include the development of tree planting agreements, specifying requirements for the selection of tree species for use near powerlines and programs to remove existing unsuitable trees and replace with powerline friendly trees. Where removal or trimming is deemed inappropriate, some re-engineering solutions are being deployed such as undergrounding, realignment, or insulation of the overhead network. Having now completed at least one full cycle of the 30 month program, vegetation management in urban areas is proving effective. It is now apparent however, that a high proportion of faults, particularly those in rural areas, occur due to vegetation being blown from outside the cutting profile. To address this, ENERGEX has embarked on a visual tree assessment program. Under this program, qualified arborists undertake a detailed assessment of trees outside the normal trimming profile to identify any inherent weakness or defects which have potential to lead to a network outage. Based on the arborist s recommendation, these trees are then trimmed or removed on a works program that at present is separately funded from the cyclic trim. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 44

51 6.4 Maintenance Management Maintenance Works Management Maintenance activities are planned and scheduled in the ENERGEX Mincom Ellipse system. For assets managed under the SAMP, planned inspection and maintenance tasks are scheduled by the Ellipse system at intervals specified in policy. For distribution assets falling under the MAMP, maintenance tasks may be scheduled for groups of assets (eg. the map based pole inspection program). Maintenance works arising from inspections and condition analysis are tracked and managed to ensure timely completion. ENERGEX is currently developing a priority based system, whereby each defect will be assigned a priority code that sets an acceptable maximum rectification period commensurate with the possible network impact Operating Investment Plans ENERGEX s Annual Operating and Maintenance Plan defines the funding, quantities and types of maintenance works for the financial year. The document includes allocations for the implementation of ENERGEX s maintenance on a hub-by-hub basis and defines allocations for any special initiatives and programs. The categories of the maintenance program of work are summarised in the following section Inspections Typical inspection works include: Pole inspection (including associated facilities) to meet five year statutory requirements; Thermal imaging inspection of overhead feeders; Inspections of ground mounted plant; Inspections of earthing systems; 33/11 kv feeder inspections and patrols; and Inspections of substation equipment Planned Maintenance Typical planned maintenance programs include: Maintenance and repair of waterway signage; Maintenance and repair of LV overhead services; Maintenance and repair of LV pillars; Maintenance and repair of ground mounted plant; Replacement of crossarms; Replacement of LV neutral service clamps; and Maintenance and repair of substation equipment Corrective Repairs Corrective repairs involve repairs carried out after a failure of an asset with the intention of restoring it to a state in which it can perform its required function or rendering the installation in a safe state to permit planned maintenance or replacement to occur at some later date Emergency Repairs Emergency repairs involve repairs of damaged apparatus where customers cannot be given two full working days notice of a possible electricity outage, and include all storm related repairs. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 45

52 6.5 Operations Management Network Operations Network operations include those activities required to configure, monitor and operate the network and includes activities such as: High voltage access and isolation switching; Update and maintain operating panel drawings; Prepare contingency planning; Evaluate network incidences; Manage emergency response; Quality of supply investigations; Reliability of supply investigations; Power quality voltage investigations; EMF investigations; and Load control investigations Customer Service ENERGEX provides a number of customer trouble call services which are covered by GSLs specifying the maximum allowable cycle times. Services in this category include: Connections, wrongful disconnections and customer reconnections; Loss of hot water supply; Appointments; Planned interruptions; and Reliability (duration and frequency). 6.6 Maintenance Policy Compliance As noted above, the MAMP and the SAMP define policy for maintaining ENERGEX s assets. These policies are used to determine the maintenance work to be carried out each year, and are the basis for building up the annual Operating and Maintenance POW and budget. The POW is prepared with the intention of fully funding the determined maintenance work for each year to ensure 100% compliance with policy. However, a number of factors may from time to time, result in the re-prioritisation of funding or resourcing for certain programs. These factors may include emerging issues resulting from the continual review of policy to keep abreast of developments. Another cause is the uncertainty in the number, and hence total cost of rectifiable defects arising from inspections. Finally there can be limitations in network access or material supply which may prevent some determined work from being completed over a single budget year. Where aspects of maintenance policy cannot be met, work is prioritised to ensure minimal impact on safety and network reliability. The key areas where maintenance requirements determined from the MAMP or the SAMP are not adequately provided for within the 2008/09 POW are described below Internal Maintenance of Oil Filled RMUs The level of maintenance of oil filled RMUs needs to be increased owing to previous resource and operating budget constraints. Visual condition assessments (inspections) are however, regularly ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 46

53 performed. To manage the risk associated with this, all affected sites have been placed under an operating restriction which may only be removed when the internal maintenance is completed. A maintenance and replacement program has been developed where it is planned to have all operating restrictions removed and a reversion to the normal maintenance cycle by 2011/ Internal Maintenance of 11 kv Step Voltage Regulators (SVRs) A budget provision was initially made in 2007/08 for a number of 11 kv SVRs to be maintained and this provision now continues for 2008/09. Policy in regard to this item is subject to ongoing review as further engineering analysis is conducted into the possible degradation of these units over time. Until this analysis is complete, it is difficult to determine appropriate funding for what is regarded as a low risk event Maintenance on Some Non-Critical Protection Systems In many instances (eg. 11 kv feeders), the level of maintenance of non-critical protection systems needs to be improved due to resource restrictions. Maintenance has been limited to some testing which was conducted during routine 11 kv circuit breaker maintenance. A detailed maintenance program has been developed for 2008/09 based on criticality and when completed, should ensure compliance with the SAMP for future years. 6.7 Maintenance Developments Maintenance Processes Review In order to compare ENERGEX s maintenance activities with best practice, ENERGEX has engaged a consultant, EA Technology, to undertake a substantial review of all maintenance activities including policy and program management. This maintenance review has been completed and its recommendations are currently under consideration. Pending the outcome of this review, it is likely that a number of enhancements will be made to the MAMP/SAMP and additional activities will be included in future revisions of the Operating and Maintenance Plan Emerging Maintenance Issues Unitised Air Break Switches (ABSs) Reports have been received from within ENERGEX and ERGON Energy of potential in-service failure of some models of unitised 11 kv ABSs. Although no longer being purchased by ENERGEX, these switches were manufactured and supplied to ENERGEX in 1990 and the period Investigations to date have revealed the failures may be occurring as a result of cracking of the porcelain insulators. Whilst these investigations continue, steps have been put in place to ensure that a detailed inspection of ABS sites is conducted prior to any switching being carried out and a range of strategies are being considered for longer term implementation. It is possible that a policy change may occur with regard to these units and any rectification works would require funding in addition to that budgeted for the existing 2008/09 POW. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 47

54 7.0 Demand Management 7.1 Introduction Demand Management as an Alternative to Network Augmentation The strong economic growth in Queensland, together with increasing population and the everincreasing use of electrical appliances such as air conditioning, computers and large-size televisions by customers, is resulting in significantly increased electricity consumption and demand. Energy conservation and demand management are strongly complementary disciplines that work hand-in-hand. However, conceptually, they can be separated into: Energy conservation - the reduction in the total quantity of electricity (MWh) used by customers; and Demand management - the reduction in the demand for electricity (MW) used by customers at peak times. Whilst having their own primary objectives both disciplines enjoy strong synergies where strategically combined. For example, energy conservation programs are recognised internationally as effecting a lasting contribution to peak demand reductions while demand management also reduces water consumption and CO2 emissions from peaking plants. Most importantly, both disciplines reinforce a multi-dimensional community focus on and momentum for purposeful, intelligent energy use. Peak demand is driven by concurrent use of electricity by multiple customers. System peak demand occurs mostly when there is extreme hot and humid weather typically the equivalent of a few days per year. Peak demand drives greater infrastructure capacity requirements leading to higher capital expenditure. Approximately ten percent of the capacity is built to deliver an energy amount that is only needed for approximately the equivalent of three days per year. An impact of increasing energy consumption and peak demand is the cost of providing infrastructure to meet such short duration peaks. This is demonstrated in the Arana Hills / Albany Creek area in Brisbane, where demand (underpinned by air conditioning usage) on a hot November day increased by 65 percent over the previous cooler day, as shown in Figure 15. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 48

55 60 Albany Creek / Arana Hills Peak Demand in November MV.A /11/2006 (max temp:35.6) 30/11/2006 (max temp: 23.3) 0 0:00 02:00 04:00 06:00 08:00 10:00 12:00 14:00 16:00 18:00 20:00 22:00 Figure 15 - Albany Creek / Arana Hills Peak Demand Network Demand Management (NDM) offers a means of reducing the peakiness of the load curves and producing a flatter load shape. It achieves this by reducing loads at times of maximum demand and where possible adding loads during times of low demand. The best example of this process has been the automatic control by distribution authorities of electric hot water storage systems. The inherent ability of these devices to store energy allows them to be without power during peak periods without adverse effects. Their energisation during the early hours of the morning and other periods of low network usage therefore allows efficient use of the electrical network and of low cost off peak generation. In summary then, NDM is a mechanism whereby network investment can be minimised through greater utilisation of existing capacity (distribution, transmission and generation) and energy consumption can be minimised through reduced network losses. The challenge for a DNSP such as ENERGEX, is how to make NDM initiatives work within the economic framework of the Regulatory Test provisions of the Rules whilst still meeting customer requirements ENERGEX Peak Demand Condition Over the past ten years, growth in demand on the Queensland distribution systems has not only increased significantly, but the shape of demand has changed. Prior to the early 2000s, Queensland s distribution networks were winter peaking with the classical load characteristic of a saddle-shaped daily load curve, peaking in the morning and evening with lower consumption between these times. This was primarily caused by customer demand associated with normal daily household routines that consume electricity; such as space heating (in the cooler winter months), cooking, showering (hot water heating) and laundry activities. In more recent years, the load shape at times of maximum demand on the network has changed to a longer, flatter hump during summer that grows in the morning and steadily increases until 4.30pm to 5.00pm, when the load gradually declines. In the modern summer load shape, the underlying ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 49

56 residential characteristics of normal daily household routines still exist, however, additional factors such as residential air conditioning (on a hot summer day), large C&I customer flat load profiles and small/medium enterprise load (mainly between 7.00am and 5.00pm) are now of new significance. Figure 16 shows how ENERGEX s annual peak demand has (a) changed in shape (b) changed from a winter peak to a summer peak and (c) increased approximately 300 percent from 1992 to ENERGEX Annual Peak Demand Comparsion Winter 1992 and Summer MW Summer 2007 Winter :30 02:30 04:30 06:30 08:30 10:30 12:30 14:30 16:30 18:30 20:30 22:30 Figure 16 - ENERGEX Winter/Summer Peak Demand Comparison The impact of the changing load shape is demonstrated via a load duration curve as shown in Figure 17. This illustrates network utilisation by graphing average half hour load (MW) over a full year against the number of half hour periods where this load was exceeded. The 2006/07 graph shows that a network built to accommodate a half hour average load of 2,500 MW would meet customer load requirements for only 50% of the time during that year. Similarly, whilst a network capacity of 3,812 MW would have met requirements for 99% of the time, a much higher capacity of 4,289 MW (an extra 12.5%) was necessary to meet needs for 100% of the time. In other words, the top ten percent of load occurs for less than one percent of the year. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 50

57 4400 ENERGEX 2006/07 Load Duration Curve MW 2006/ % 1% 2% % 10% 21% 31% 41% 51% 62% 72% 82% 92% Figure 17 - ENERGEX 2006/07 Load Duration Curve 7.2 Demand Management Strategies Both the National Electricity Rules and the Queensland Electricity Industry Code require demand management options to be considered as an equal alternative to network augmentation options. This is specified within Clause 5.6.2(a & f) of the Rules and Clause of the Code. ENERGEX has dedicated significant resources and emphasis on NDM over the past 12 months. This has included: Expansion of the dedicated NDM team within the Demand and Risk Management Group; Development and approval of NDM strategies, programs and projects; Forging of close working relationships with Ergon Energy on future NDM programs and strategies; Continued focus on a Queensland industry approach to seeking NDM alternatives for the state, working closely with the DME; and ENERGEX chairing the Demand Management and Embedded Generation committee of the Energy Networks Association (ENA), the peak body of electricity networks in Australia. 7.3 Demand Management Programs ENERGEX has commenced developing and implementing NDM programs as part of an integrated resource planning process to defer program of works where it is prudent and efficient. The outcome of this process may result in program of work supply side deferment in capital expenditure and the implementation of NDM as alternative expenditure Existing Network Support Programs Kilcoy NDM Network Support Program ENERGEX is implementing Kilcoy NDM program to defer network augmentation from summer 2007/08 to the end of August Two 1 MV.A mobile generating units were installed for summer 2007/08 to inject supply at low voltage via two 11 kv overhead feeders. These generators ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 51

58 are remote started during the occasional summer and winter peak periods and are expected to run for less than 50 hours per annum. This NDM program is cost effective in deferring supply side reinforcement until At that time, ENERGEX would reinforce supply in the Kilcoy area by constructing a new 33 kv feeder between Beerwah and Woodford Existing Residential Programs and Results ENERGEX continued with its hot water load control program in 2007/08. In winter, some 350 MW of hot water load was controlled during the evening peak and approximately 50 MW during the summer evening peak. ENERGEX continually reviews the summer and winter hot water switching program to optimise network benefits. ENERGEX also held an information session on the hot water switching schedule for retailers. In summer 2007/08, ENERGEX invited customers to participate in an air conditioner load control trial called time for a cool change (Cool Change). The trial objectives were to: Test the feasibility of cycling residential air conditioning during times of peak demand; Evaluate the technology and running costs of the trial; and Analyse the impacts on customer comfort levels. The trial results demonstrated a peak load reduction of approximately 1 kw per house, with minimal impacts to customer comfort during cycling. On a diversified basis this translates into about 0.6 MW for the approximately 1,000 customers participating in the trial. ENERGEX intends to expand the Cool Change trial in 2008/ Planned Programs From summer 2008/09, a third 1 MV.A mobile generator will be connected near the Kilcoy substation to inject a further 1 MV.A into another 11 kv overhead feeder. ENERGEX is undertaking a number of investigations into potential network support programs. Potential opportunities are identified during the development planning process and have been included in Part B of the NMP. 7.4 Future Challenges Air Conditioning Growth Air conditioner prices are continuing to fall as they become commoditised to the point where non traditional outlets such as large hardware chains offer them at discounted prices. It is anticipated that their contribution to the summer peak will increase State Hot Water System Rules Hot water heating has a significant impact on both electricity demand and consumption. Much has been done to address this including off-peak pricing (tariff 31 and 33), changes to building codes that prohibit electric hot water systems in any new houses (being a Class 1 dwelling) and a policy extension that prohibits any replacement hot water systems being installed in areas with gas reticulation from Whilst ENERGEX supports non-electric hot water alternatives, there is concern with the growing trend of instantaneous hot water in high density accommodation. ENERGEX is currently analysing the impact of this policy change on its network. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 52

59 7.5 Future Opportunities Power Factor Correction and kv.a Tariff Since 1998, ENERGEX s capacity and demand network charges have been kw based. This approach was taken because information on customers' power factor (and hence kv.a) was limited. ENERGEX has proposed introducing kv.a based charges as a step towards developing more efficient network prices. This approach has been foreshadowed in ENERGEX Pricing Principles Statements since 2001/02. The move to kv.a based demand and capacity network charges will improve pricing efficiency in the network to ultimately reduce the maximum demand on the network. kv.a based charges will provide customers with an opportunity to improve their power factor and reduce their network charges. Since the introduction of a contestable market in Queensland, interval meters with the ability to record kv.a have been installed at more than 3,000 business sites. Data from these sites has provided ENERGEX with a profile of the power factors of customers which will be required to develop kv.a based charges. The distributors and the Government have worked together during 2007/08 and further work into kv.a tariffs will be undertaken in 2008/09. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 53

60 /08 General Performance In general, the focused and targeted response of ENERGEX over the past 12 months has maintained or produced improvements in network capacity, security and reliability performance. The following is an overview of the progress made against the major strategies and actions identified in last years NMP. More specific details on reliability performance are provided in section /08 Summer Preparedness Plan In accordance with the requirements of the Electricity Industry Code, ENERGEX completed detailed preparation and planning for the 2007/08 summer season. These plans were documented in the ENERGEX Summer Preparedness Plan 2007/08 (SPP) which was made available to the public via the ENERGEX web site. ENERGEX developed the SPP as part of a long term, continuous improvement strategy and plans to further improve the resilience of the network to severe weather events. These initiatives have enhanced the quality of the network and improved ENERGEX s capacity to respond operationally to contingency events. Further improvements are anticipated in these two areas and in ENERGEX s ability to keep customers informed of supply restoration progress. A formal report detailing ENERGEX s compliance with the 2007/08 SPP was prepared and submitted to the QCA on 1 April In summary, ENERGEX met or exceeded most targets and programs set out in the 2007/08 SPP. Where program of work targets were behind schedule, contingency plans were deployed to deal with any potential network failures. The combination of a mild summer and the implementation of the SPP and associated plans ensured that the summer was endured without significant incident. 8.2 Capital Investments for Growth, Reliability and Security Capital Expenditure for 2007/08 ENERGEX s network system capital expenditure for 2007/08 reached $670 million in value. Table 9 shows the detailed CAPEX expenditure for 2007/08 for customer driven works and transmission and backbone head works. Capital Expenditure 2007/08 1 Item Budget ($M) Actual ($M) 2 Electricity Transmission Electricity Distribution System CAPEX Sub-total Non-system Total Note 1 Nominal dollars including non-system depreciation. Table 9 - Comparison of CAPEX Budget with Actual Expenditure The significant underspend experienced in the Transmission POW during 2007/08 has been primarily caused by delays in projects scheduled for completion beyond 2007/08, or customer requested delays associated with customer driven projects. Furthermore, the 2007/08 Transmission POW made allowance for a significant number of projects associated with water and road infrastructure projects, many of which have not progressed as forecast. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 54

61 8.2.2 Overview of Capital Expenditure Outcomes ENERGEX s network system capital expenditure of $670 million enabled the realisation of significant improvements and expansions to the electricity network during 2007/08. Table 10 documents some of the achievements realised with the capital budget. Activity Per 2007/08 Target 2007/08 Actual 11 kv Distribution feeder upgrades feeder Install PMRs and sectionalisers switch Replace distribution transformers with trace PCB transformer Six Sigma pole nailing program nail 3,600 3,384 MDI distribution transformer upgrade program transformer Replacement of concentric and open wire services service 22,500 22,891 Increase in installed substation capacity MV.A kv 7/.064 conductor replacement km LV 7/.064 conductor replacements km Other 33 kv feeders installed or upgraded no. na kv ring main unit replacements no. na 189 Line fault indicator installations no. na 154 Cable fault indicator installations no. na 40 Table 10 - Capital Expenditure Sample Outcomes 2007/08 The 11 kv distribution feeder target of 214 was set prior to finalisation of the 2007/08 POW and was revised downward to 183 at the first quarter review of the POW. Of those feeders not completed, 27 are associated with projects in the CBD. These projects were delayed due to: customers rescheduling commissioning dates due to construction delays; much of the construction and commissioning had to be conducted at night and weekends to limit disruption of supply to existing customers; and the complexity of maintaining full N-1 supply to customers during construction. The remaining feeder projects are made up from works associated with delayed sub-transmission works. The associated 11 kv feeders had a substantial amount of work completed during the year but were not recorded as completed as they had not been energised. Six 11 kv feeders at Currumbin for example, were installed, but await switchgear energisation before they can be commissioned. All outstanding feeder projects from the revised 183 target will be completed in 2008/09 and in particular those feeders required before summer have been scheduled for completion in the first two quarters of the financial year. Some of the other activities were also programmed for the third and fourth quarters of 2007/08. Continued industrial action during this period, and overtime bans in particular, delayed completion of some works. The installation of PMRs, sectionalisers and the 7/.064 replacement were adversely affected in this way. A significant wet season on the north coast also impacted by creating site access problems and so delayed some of the 11 kv conductor replacement works. Appendix 3 lists all the major projects planned for completion during 2007/08 and their progress. The shortfall in substation capacity installed over the year is due to the various project delays described fully in this Appendix. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 55

62 8.3 Operating Investments for Network Maintenance, Safety and Reliability Operating Expenditure for 2007/08 ENERGEX has made progress in its plans to improve the reliability of the network to meet the MSS outlined in the Electricity Industry Code. To accomplish this, ENERGEX spent $280 million on operations and maintenance in 2007/08. Table 11 shows the detailed OPEX expenditure against the 2007/08 budget for direct and indirect network activities. Operational Expenditure 2007/08 Item Budget ($M) Actual ($M) Inspection Planned Maintenance Corrective Repair Emergency Response / Storms Vegetation Streetlights Customer Service Network Operations DSM Network Support Services Recoverable Works Expenditure Temporary Builders Service Telecommunications Services Recoverable Works - Exceptional Events Non Distribution Services - Other Recoverable Works - Electricity Retailers Total Operations and Maintenance Non-POW Infrastructure Projects Levies Call Centre Meter Reading Metering Dynamic Total Non-POW Total OPEX Note 1 Nominal dollars. Table 11 - Comparison of OPEX Budget with Actual Expenditure The 2007/08 OPEX expenditure was less than forecast due to fewer emergency repairs required as the summer storm season was milder than forecast. Another factor was that vegetation management expenditure was less than forecast. Whilst the programmed length of lines trimmed was exceeded, the overall budget was underspent due to a significant reduction in the number of customer requested "spot clearing requests" from forecast Overview of Operating Expenditure Outcomes Table 12 below lists some of the critical network maintenance activities undertaken in 2007/08. A wide range of activities were carried out in the course of the year with generally satisfactory outcomes. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 56

63 The vegetation management program achieved positive results in 2007/08 with works associated with the transmission network being ahead of target. Distribution network clearing also slightly exceeded target. The pole inspection target of 107,311 is based on achieving the regulated requirement of inspecting all poles at least every five years. All necessary pole inspections were completed by the end of the financial year with the target slightly exceeded. The performance of ENERGEX s pole population continues to exceed the industry target for reliability with an in-service pole reliability of %. The EDSD report s recommendation to reduce the bush pole population was also achieved during 2007/08 by a combination of a targeted bush pole replacement program and other initiatives to increase bush pole replacement in conjunction with other feeder upgrade works. Activity Per 2007/08 Target 2007/08 Actual Sector based vegetation (distribution) km 13,436 13,903 Feeder based vegetation (transmission) km 987 1,047 Pole inspection program pole 107, ,034 LV Preventative crossarm replacements crossarm 7,240 7, kv Preventative crossarm replacements crossarm 4,620 4, kv Preventative crossarm replacements crossarm kv Pre-storm feeder patrols feeder 1,113 1, kv Pre-storm feeder patrol feeder /110 kv feeder patrol feeder Read Maximum Demand Indicators (MDIs) site 18,000 14,474 Install wide trident pole Replace neutral clamps on LV services clamp 12,500 21,609 Installation of LV spacers spacer 5,000 13, kv CB maintenance CB On load tap changer maintenance OLTC Reliability assessments on worst performing feeders feeder Table 12 - Operating Expenditure Sample Outcomes 2007/08 LV crossarm replacements exceeded the target by almost five percent. The 11 kv and 33 kv crossarm replacements were less favourable to targets however, partly due to the fewer number of defective 33 kv crossarms being detected compared to the target. Pre storm feeder patrols ramp up during the March to June months and progress was very positive. Both the 11 kv and 33 kv pre storm patrols were completed on schedule. The replacement of narrow with wide trident (an 11 kv overhead construction type) exceeded targets by 18%. The installation of LV spacers was well ahead of target with more than 8,000 extra spacers fitted. Similarly, the replacement of older claw type neutral clamps was well ahead of target with more than 9,000 extra clamps installed. By contrast, on load tap changer maintenance was below target falling short by about 27%. This has been partly due to transformer replacements but also arose from errors in the original budgeting. Scheduling software deficiencies generated inaccurate maintenance dates which exaggerated the quantity of OLTCs to be maintained. The software error will been remedied by a package upgrade and in the meantime procedural workarounds are ensuring that the errors are not repeated. Due to the same budgeting errors, 11 kv CB maintenance appears below target by a similar margin. Most of the 2007/08 MDI program was scheduled between April and June 30. This year however, the scope of work was increased to include asset checks and additional data collection. This ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 57

64 increased cycle times above the budget forecast. Furthermore, a significant batch of work issued to one service provider needed to be re-allocated due to contractor capability issues. Although the MDI readings will be used to identify any summer preparedness risks for 2008/09, they only affect transformer upgrade works for the 2009/10 program of work. The completion of these readings in early 2008/09 should therefore ensure that the delays have minimal impact. One hundred and ten worst performing 11 kv feeders were assessed to identify the root causes of reliability underperformance and propose solutions. In most cases, this involved inspections of the front sections of feeders where most reliability benefits are obtainable. Although feeder reliability solutions form part of the capital and operating expenditure budgets, the more routine works such as narrow trident replacements, urgent maintenance or resolution of safety matters are generally addressed within the OPEX budget. More complex reliability solutions such as site or feeder redesign, installation of covered conductor (CCT) or installation of reliability devices such as reclosers, load break switches or sectionalisers are undertaken as part of the CAPEX works in subsequent years. As a result of reliability assessments carried out during the past year, a range of such measures were implemented or placed in the planning process. 8.4 Asset Utilisation Zone and Bulk Substations Table 13 shows the Maximum Demand Utilisation (MDU) for substations at the end of each of the last five financial years. Although no additional bulk supply capacity was added during 2007/08, the very mild summer resulted in a lower bulk supply utilisation of 61.2%. In 2007/ MV.A of additional zone substation transformer capacity was installed to improve substation utilisation. The MDU for zone substations has decreased from 77.0% in 2003/04 to 56.2% due to the increased capital works program and the cooler than expected summer weather over the last two summers. Contingency plans identified load transfers which could be made between bulk supply substations should a contingency (N-1) event occur. Substation Substation Utilisation 2003/ / / / /08 Type Category Bulk Supply Demand Utilisation - NPR 75.0% 74.2% 71.2% 63.0% 61.2% Demand Utilisation N % 132.0% 114.1% 97.0% 95.7% Zone Demand Utilisation NPR 77.0% 68.8% 64.6% 59.6% 56.2% Demand Utilisation N % 117.3% 110.8% 110.8% 92.4% Table 13 - Substation Maximum Demand Utilisation Table 14 summarises the current status of bulk supply and zone substations with respect to NCC and N-1 capacity. The significant increase in zone substation capacity has produced a reduction in substations with loads exceeding their N-1 ratings down to 109 in 2007/08. Where there is risk of loads exceeding NCC or N-1 capacity, this is generally managed by the use of transfers between substations, contingency plans or operational response procedures. Section 11.3 describes plans to reduce overall substation utilisation and contingency exposures and Part B of the NMP contains lists of individual substation forecast loads. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 58

65 Substation Type Substation Loading 2003/04 Qty 2004/05 Qty 2005/06 Qty 2006/07 Qty 2007/08 Qty Bulk Supply Demand > NCC Demand > N Total Substations Zone Demand > NCC Demand > N Total Substations Note 1 Based on actual demands. Minor overloads (<1 MV.A) that can be covered by transfers are excluded. Note 2 Based on actual demands. Minor overloads (<1 MV.A) that can be covered by transfers are excluded. Note 3 From 2007/08, zone substations include customer installations with voltage transformations. Note 4 Cable, switchgear and load sharing limitations are included from 2007/08. Table 14 - Current Status of Bulk Supply and Zone Substations and 110 kv Feeders Table 15 shows that no feeders exceeded normal NCC ratings in Eleven feeders exceeded the N-1 rating. The reduction in feeder security is due to localised demand growth in excess of forecasts, especially in residential areas and the delayed completion of the 2007/08 capital works. Where there is a risk of loads exceeding NCC or N-1 capacity, this is generally managed by the use of load transfers, contingency plans or operational response procedures. A detailed list of feeders with their forecast maximum demands is available in Part B of the NMP. System Configuration 132/110 kv Feeder Loading 2003/04 Qty 2004/05 Qty 2005/06 Qty 2006/07 Qty 2007/08 Qty Normal Demand > 1.0 NCC 1 na N-1 Demand > 1.0 ECC 2 na Total Feeders na Note 1 Based on actual demands. Minor overloads (<1 MV.A) that can be covered by transfers are excluded. Note 2 Based on actual demands. Minor overloads (<2 MV.A) that can be covered by transfers are excluded. Table /110 kv Feeder Utilisation kv Feeder Utilisation The number of 33 kv feeders exceeding their NCC rating increased to 14 from 12 in 2008 as shown in Table 16. The increase has arisen due to a concentration of resources on higher priority projects and some localised demand growth in excess of forecasts. New substations and feeders planned over the next five to ten years will reduce these overloads to comply with planning guidelines. A detailed list of feeders with their forecast maximum demands is available in Part B of the NMP. System Configuration 33 kv Feeder Loading 2003/04 Qty 2004/05 Qty 2005/06 Qty 2006/07 Qty 2007/08 Qty Normal Demand > 1.0 NCC N-1 Demand > 1.0 ECC Total Feeders Note 1 Based on actual demands. Minor overloads (<5 A) that can be covered by transfers are excluded. Note 2 Based on actual demands. Minor overloads (<5 A) that can be covered by transfers are excluded. Note 3 The ECC rating is the same as the NCC rating for all circuits except transformer cables. Note 4 Includes normally open feeders but not T-off feeders. Table kv Feeder Utilisation ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 59

66 kv Feeder Utilisation 11 kv feeder utilisation as shown in Table 17 is measured by the number of feeders where the maximum demand (temperature corrected to 10 PoE since 2005/06) has exceeded the rating of the feeder. During 2005/06 and 2006/07 ENERGEX used Archerfield temperature data. During 2007/08 ENERGEX began using the statistically more complete temperature data records for Amberley as the new reference. As a result, the reported figures for 2005/06 and 2006/07 in Table 17 are now considered to underestimate the temperature-corrected demand by approximately three percent. The various methods used to manage highly loaded feeders are: Load levelling by switching of loads between feeders; Installation of generators; Upgrading of feeders to increase rating; and Increasing the number of 11 kv feeders. Section of this report summarises the plans to reduce overall 11 kv feeder utilisation. 11 kv Feeder Loading 2003/04 Qty 2004/05 Qty 2005/06 Qty 2006/07 Qty 2007/08 Qty Demand > 1.0 NCC ,3 Total Feeders 1,351 1,395 1,489 1,579 1,700 Note 1 Based on summer peak loads. Note 2 Based on temperature corrected summer 10 PoE loads, using temperature data for Archerfield during 2005/06 and 2006/07 and Amberley for 2007/08. Note 3 Of the 55 feeders, 22 exceeded NCC by only 1 to 3% of rating. Table kv Feeder Utilisation Distribution Transformer Loading After summer each year, distribution transformer MDIs are collected to develop the distribution transformer upgrade program for the following summer. Commencing in late February, the data acquisition process continues until 30 June, by which time readings from thousands of transformers between 200 and 1500 kv.a are gathered. After several weeks of processing and analysis, heavily loaded transformers are identified and prioritised for augmentation. About 8,000 MDI readings were available at the end of June 2008 and from these the transformer loadings were estimated as shown in Figure 18. These estimated loadings are accurate enough to allow comparison from year to year where the differences are significant. Accordingly the number of transformers loaded beyond nameplate ratings has clearly declined due to the mild summer and the focus on upgrading the transformers in these categories. By contrast, the number of transformers in the % band has grown considerably, indicating that mitigation work will be required in this area as greater control is gained of the more highly loaded group. ENERGEX determines the normal cycling rating of transformers in accordance with the relevant standards. Generally this allows summer loading of transformers up to 120% of nameplate rating without an unacceptable loss of life. Transformers with utilisation in excess for 120% of nameplate rating are targeted for augmentation. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 60

67 4500 Distribution Transformer Loadings over Four Years Number of Transformers / / / /08 80%-100% 100%-120% 120% - 140% > 140% Transformer Loadings (Non Temperature Corrected) Note 1 Figures are estimates based on the valid sample readings which are extrapolated to the full population of kv.a transformers. Figure 18 - Distribution Transformer Loads Compared to Nameplate Ratings 8.5 Asset Refurbishment Asset Inspection and Refurbishment Programs ENERGEX manages a large population of assets in various stages of the asset life cycle. At any given time, a portion of the asset base is reaching the end of its useful life and requires intervention to prevent a reduction in network safety and reliability and/or an increase in operating costs. ENERGEX, wherever possible, determines the end of life of an asset based upon a technical assessment of condition and performance rather than a fixed economic life Ring Main Units Significant refurbishment work has been achieved over the 2007/08 period in a number of programs. ENERGEX has identified several types of Ring Main Units (RMUs) that have displayed evidence of deterioration. Over a two year period, it is proposed to retire all GEC brand oil filled units from the network and also replace heavily loaded ABB Andelect units with either SF6 insulated ABB Safelink units or Andelect units which have been fully refurbished off-site. In the latter half of the year, emerging issues were identified with the Long and Crawford brand of RMU and it was agreed that these would also be incorporated into the replacement program. Progress on this program for the 2007/08 year is given in Figure 19. The balance of the replacements will be included in the 2008/09 works program. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 61

68 RMU Replacement Program Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Actual Target Figure 19 - Ring Main Unit Replacement Program Overhead Copper Conductor Replacement A similar program has resulted from inspection programs and fault analysis which have identified issues with ageing conductors, specifically 7/.064 copper conductor. ENERGEX has developed a program to replace 7/.064 conductor in a programmed manner for both 11 kv and LV conductors. As shown in Figure 20 and Figure 21, 123 km of 11 kv and 41 km of LV 7/.064 conductor was programmed to be replaced over the 2007/08 period and 80.5 and 30.1 km respectively was completed. The balance of the replacements will be included in future works program. 7/ kV Conductor Replacement Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 M ar-08 Apr-08 M ay-08 Jun-08 Actual Target Figure 20-7/ kv Conductor Replacement Program ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 62

69 7/.064 LV Conductor Replacement Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 M ar-08 Apr-08 M ay-08 Jun-08 Actual Target Figure 21-7/.064 LV Conductor Replacement Program Streetlight Main Recovery As an initiative to improve customer safety and reduce conflict between the electrical network and vegetation, the 2007/08 POW included provision for the recovery of four hundred sections of overhead streetlighting circuit. This target was exceeded, with 1,484 sections recovered as illustrated in Figure 22. Recover S/L Main Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Actual Target Figure 22 - Streetlight Main Recovery Program Distribution Transformer Replacement Program To comply with current environmental legislation and to assist in maintaining a safe workplace, ENERGEX has completed a sampling program for high risk distribution transformers to determine concentration levels of Polychlorinated Biphenyls (PCBs). Under a management plan agreed with the EPA, the transformers found to have above acceptable levels have now been removed from the network as shown in Figure 23. This program achieved the removal of 254 transformers by 30 June 2008, with the remainder replaced in early 2008/09. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 63

70 LV Distribution Transformer - PCB Program Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 M ar-08 Apr-08 M ay-08 Jun-08 Actual Target Figure 23 - LV Distribution Transformer PCB Program 8.6 Power Quality Power Quality Performance Monitoring Various power quality parameters are measured and recorded following a voltage complaint of one type or another. Power quality problems identified are rectified at the point of concern. Reports on specific issues such as background harmonics, are usually prepared in association with planning studies for a particular area when necessary Voltage Enquiries (Complaints) The EDSD Independent Panel findings found that quality of supply complaints in 2002/03 were three times higher than those attributed to reliability and recommended these voltage problems be addressed by eliminating load and voltage constraints in the sub-transmission and high voltage networks. The trend is showing a reduction as demonstrated by Figure 24 which displays voltage complaints over the last few years. Figure 25 shows a breakdown of these enquiries by cause. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 64

71 Voltage Complaints 2 Complaints per 10,000 Customers Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Two Years Prior One Year Prior Current Year Figure 24 - Voltage Complaints No cause found 30% Percentage of Voltage Enquiries Classified by Cause (July June 2008) Faulty network equipment 6% Network interference by ENERGEX 7% Network interference by another customer 3% Customer side of the meter 13% Network limitation 30% Other 11% Environment 0% Figure 25 - Voltage Enquiries Classified by Cause National Power Quality Survey ENERGEX in the past has participated in the long-term National Power Quality Survey conducted by the University of Wollongong. ENERGEX monitored six LV and four MV sites. The small sample size means that the results are not necessarily representative of overall network performance. ENERGEX is rejoining the scheme for two years starting in June 2008 and 11 meters are being re-established for monitoring purposes. In the 2003/04 report (most recent available), ENERGEX obtained a median ranking for overall LV performance and a less favourable ranking against other utilities for overall MV performance. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 65

72 Figure 26 displays this with a normalised ranking of voltage quality using a formula developed by Wollongong University. LV Overall MV Overall Note 1 ENERGEX is represented by the red coloured bar with the vertical axis showing normalised performance. (Smaller bars represent better performance) Figure 26 - LV and MV Power Quality Performance by Utility The unbalance performance is mainly due to unbalanced connection of LV loads. Due to the proximity of A and B phase overhead conductors to the pole, linesmen have historically tended to connect more load to these phases than to C phase. Regarding other parameters, harmonics is worthy of mention and is measured as the 95th percentile cumulative probability. Although at medium voltages, levels of harmonics have increased over the reporting period, they are still within National Electricity Rule requirements. Current network building blocks specify the installation of an EDMI Mark 3 smart meter in all new modular substations for monitoring power quality on the 11 kv bus. Meters are being installed on new installations. Such metering has been installed in some new substations over the last 18 months and documentation associated with these meters is still being developed to allow their full commissioning Power Quality Proposals It is anticipated that regulatory pressure will be brought to bear to monitor the distribution network. ENERGEX plans to commence such a data acquisition scheme in 2009/10 and will install power quality meters at the end of selected 11 kv feeders. It is proposed to monitor one feeder from each zone substation by the end of the 5 year regulatory period (approximately 260 sites). Regulatory requirements may be clearer by then and future extensions of the scheme will be apparent. While the basic unit is a meter with mobile telephone facilities using the public network, the Distribution System SCADA (DSS) mesh radio system could possibly be used for selected sites that have no mobile phone coverage. The scheme should monitor the following parameters: Steady state voltage magnitude; Voltage sags and swells; Harmonic distortion; and Voltage unbalance. Other identified projects required for customer service improvement and regulatory requirements are scheduled for the next regulatory period, subject to funding approval, through to 2014/15 and include: ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 66

73 Extend zone substation power quality monitoring to existing substations where no additional work is planned 200 substations over 5 years; Retrofit power quality monitoring at planned zone substation upgrades covered in AER submission 60 substations over 5 years; Balance LV circuits - stage 1; Implement distribution transformer power quality monitoring and reporting 264 meters over 5 years on transformers located at the end of 11 kv feeders plus data retrieval, storage and basic reporting; Implement power quality database and reporting system through Metering Dynamics; and Participation in National Power Quality Survey (University of Wollongong) Substation Power Factor Table 18 shows the number of bulk supply and zone substations with lagging power factor less than 0.9 and 0.95 respectively. Loads at low power factors effectively use up capacity on the network and can unnecessarily accelerate the need for augmentation. A load at a power factor of 0.9 would use approximately 5% more capacity than an identical load (in kw) at a power factor of Power factor improvements can therefore make a significant impact in deferring network expansion to accommodate demand growth. The decline in ENERGEX s power factor over the last year is due to the continuing growth in demand for electricity and in particular domestic air-conditioning, despite the relatively mild summer. At the time of the system demand peak on Saturday 23rd of February 2008, the increased demand resulted in power factors of less than 0.9 at more zone substations than in the summer of 2006/07. ENERGEX is planning to improve the power factor at zone substations by installing capacitor banks as part of the program of works. Substation Type 132/110 kv Feeder Loading 2003/04 Qty 2004/05 Qty 2005/06 Qty 2006/07 Qty 2007/08 Qty Bulk Supply Power Factor < 0.9 lag Power Factor < 0.95 lag Zone Power Factor < 0.9 lag Power Factor < 0.95 lag Note 1 The Rules require a power factor of > 0.95 at voltages above 50 kv and > 0.90 at lower voltages. Table 18 - Substation Power Factor 8.7 Other Areas Guaranteed Service Levels Distribution entities are accountable for the administration of the guaranteed service level program regardless of whether the error was caused by the distribution entity or an independent retailer. In the period 1 July 2007 to 30 June 2008 a total of 971 GSL claims were paid from a total of 235,612 service orders. 702 of these events were related to the distribution entity as shown in Table 19 which itemises claims paid during 2007/08. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 67

74 GSL Event Total GSL Claims Distribution Related Retailer Related Reliability Planned interruption - Business Planned interruption - Residential Reliability - interruption duration Reliability - interruption frequency Total Reliability Customer Service Failure to complete connection Wrongful disconnection Failure to reconnect Hot water complaint - failure to attend Missed scheduled appointment Total Customer Service GSL Total Note 1 Many failure to complete connection GSL claims for May and June 2008 have not been processed and are not included in the table. There are 2,785 such claims still being investigated as of 1 st August. Table 19 GSL Claims Paid by Category and Entity Source Nine hundred and fifty five GSL events were customer service related issues. The remaining GSL events were reliability related, involving planned interruptions and supply interruptions, and remain within the historical range for such events. A wrongful disconnection GSL is paid to a customer whose supply is disconnected in error. Three hundred and seventy three of these GSLs were paid last year from 73,769 wrongful disconnection service orders. One hundred and fifty eight of these GSLs were due to an error made by the distribution entity. New connection GSLs have increased in the last half of 2007/08. In the financial year, 512 claims have been approved, with the majority of these claims paid in the December to February peak period. These have been driven largely by a significant and unprecedented increase in the number of new connections which occurred in the December 2007 quarter, the highest volume of new network connections in the last ten years. Other factors influencing the increase in new connection GSLs include: Efforts were focussed on processing new connection requests from customers, instead of processing the payment of claims. The belated provision of customer data from the various Retailers has added to the current delay in processing GSL payments; An increase in workload due to the removal of unmetered temporary builders services resulting in increased coordination of metered sites. This volume of work continued through until late March 2008; Extended periods of rain as well as network system outages (planned and unplanned) contributed to jobs being deferred or rescheduled; and The introduction of a new computer system resulted in an initial period of delay for customers. This has since been resolved. In the future, direct comparison of historical GSL data will be difficult due to the introduction of Full Retail Competition (FRC) into the Queensland energy market. This is due to delays in the provision of customer data from the various Retailers. As potential claims cannot be approved and paid until the customer information has been received, any such delays in acquiring information adversely affect GSL performance. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 68

75 8.7.2 Contingency Planning ENERGEX reviews its contingency plans for managing network failures and events such as exceptional hot weather, on an annual basis. Detailed plans were in place for summer 2007/08. The contingency plans encompassed a number of aspects. These are detailed below: Network Contingency Plans for loss of major plant or feeders. Network Contingency Plans detail what load shifts and load management are available to restore supply following a single contingency event affecting supply to bulk supply substations, zone substations and HV feeder networks. ENERGEX develops plans for all bulk supply substations, zone substations and 132/110/33 kv feeder networks. Over 600 plans were documented and deployed during 2007/08. A number of these were used by Network Operations staff over the summer when contingency events actually occurred. Routine monitoring of network loads throughout summer was undertaken to identify any emerging hot spots in the network. Where problems were identified corrective actions were taken to alleviate them. However, due to the mild summer weather experienced in 2007/08, the number of events was relatively small Resourcing Strategies ENERGEX recognises the importance of maintaining a skilled and adequate workforce to meet the requirements of the enhanced capital works program and ensure an efficient response to network emergencies. Over recent years, ENERGEX has invested heavily in recruitment of skilled tradespersons and other technical staff essential for the delivery of a significant POW. To ensure it has the capacity to deliver its POW in 2008/09 and beyond, ENERGEX has set a sustainable internal resourcing target and will complement existing external contracting arrangements with new agreements in some key technical skill areas (eg cabling, substation design). Ongoing workforce programs such as the tradesperson recruitment program, apprentice program, paraprofessional traineeship program and graduate programs will continue to be enhanced and strategies to ensure the retention of employees will be further developed. ENERGEX will continue its successful strategy to achieve continued growth in workforce capability and capacity through: Continued local and interstate recruitment campaigns to access new candidate pools; Ongoing enhancements to training and placement strategies to enable the integration of an increased number of apprentices and tradespeople without electricity utility experience; Use of power worker roles to support tradespersons where this will facilitate better use of critical skill sets; and Continued apprentice intakes to provide future tradesperson resources. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 69

76 9.0 Five Year Historical Reliability Performance 9.1 Introduction The ENERGEX network performed creditably over the past year though the mild 2007/08 summer has resulted in low levels of storm events and reduced SAIDI for the urban network. The storms that were experienced however, buffeted the rural network and impacted significantly upon its performance. Urban SAIDI for 2007/08 was 85 minutes versus a MSS target of 134 minutes whilst the rural SAIDI was 242 minutes versus a MSS target of 244 minutes. Both outcomes were favourable to the MSS target. Urban SAIFI was 1.05 and easily achieved the target of 1.54 events. By contrast, rural SAIFI was 2.71 and was not favourable to the target of 2.63 events. As there was no exclusion events for the year, normalised and actual figures are identical. Non-storm SAIDI for the urban and rural networks have experienced mixed successes when compared to previous years. The urban non-storm SAIDI performance has improved significantly from 95 minutes in 2003/04 to just under 57 minutes for 2007/08. Rural non-storm SAIDI performance has improved only slightly from 117 minutes in 2003/04 to just under 114 minutes for 2007/08. The improvements are due to a number of factors including increased capital works, maintenance and targeted improvements across the whole network. Although the last storm season was quite mild by historical standards, the rural network was severely affected by a number of localised storms which increased the rural storm SAIDI and the number of events experienced by customers. The large variance in weather patterns from year to year highlights the difficulty of objectively comparing performance over time. Storms are traditionally accompanied with lightning, strong winds and heavy rain which have the ability to impact upon the overhead network. Strong winds often result in tree braches being blown onto powerlines causing severe damage to the network. To mitigate the effects of storms, ENERGEX introduced an ambitious vegetation program designed to reduce vegetation around powerlines to an agreed profile. Although the program has worked extremely well to immunise the network from damage, there is a limit to what vegetation clearing can do to improve network performance. Sustained strong winds can cause tree branches to dislodge and travel a large distance, from well outside the normal clearing profile, before impacting upon the powerlines. The vegetation program has now cleared all areas of the high voltage network at least once and a new clearing cycle has now commenced after some fine tuning. The past 12 months has seen a focus on the rural network through the second Rural Reliability Response (RRR) project. The project was designed to deliver improvements to rural feeders through several schemes, including the installation of Pole Mounted Reclosers (PMR) and sectionalisers to reduce the number of customers affected during an interruption. Other strategies included targeted network upgrades, prioritisation of vegetation management plans and operational initiatives associated with the deployment of additional standby crews for emergency response. Over time these initiatives will contribute to the ongoing improvement for both non-storm and storm network performance. 9.2 Reliability Performance Urban and Rural Historical SAIDI and SAIFI The SAIDI and SAIFI reliability performance of the urban and rural network over the last five years is shown in Figure 27 and Figure 28. The graphs show the contribution that non-storm, storm, ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 70

77 planned work and exclusion events (major event days) have had on the performance of the network. The 2007/08 performance has been affected by a number of factors such as storm activity, vegetation management, pre-summer preparations and accelerated programs of capital and maintenance works. At the end of June 2008, the network SAIDI performance was 85 minutes for urban and 242 minutes for rural. The performance for 2007/08 was comparable to 2006/07 and significantly better than 2005/06. The major difference was primarily the result of localised storm damage on the rural network. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 71

78 URBAN SAIDI (12 Month) Non Storm Storm Planned Exclusion MSS Target Minutes / / / / /08 URBAN SAIFI (12 Month) Non Storm Storm Planned Exclusion MSS Target Events / / / / /08 Note /04 figures are based on energy use. Customer based reporting commenced in 2004/05. Figure 27 - Urban SAIDI and SAIFI Performance ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 72

79 RURAL SAIDI (12 Month) Non Storm Storm Planned Exclusion MSS Target Minutes / / / / /08 RURAL SAIFI (12 Month) Non Storm Storm Planned Exclusion MSS Target Events / / / / /08 Note /04 figures are based on energy use. Customer based reporting commenced in 2004/05. Figure 28 - Rural SAIDI & SAIFI Performance Table 20 provides a five year comparison of performance with the 2007/08 MSS target for the CBD, urban and short rural networks. This is the performance of the network after major event days are removed and represents the normalised or underlying network performance. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 73

80 Reliability Performance 2003/04 Actual 2004/05 Actual 2005/06 Actual 2006/07 Actual 2007/08 Actual 2007/08 Target SAIDI (mins) CBD Urban Short rural SAIFI CBD Urban Short rural Note /04 figures are based on energy use. Customer based reporting commenced in 2004/05. Table 20 - Performance Compared to MSS Target With reference to Table 20, the CBD performance has deteriorated when compared to 2006/07. Both SAIDI and SAIFI were significantly favourable to the MSS target however. Urban SAIDI and SAIFI have improved significantly over the last three years and remain favourable to the MSS target. Short rural SAIDI and SAIFI have shown significant improvement compared to 2005/06 with SAIDI currently favourable to the MSS target. Short rural SAIFI has returned full year results unfavourable to the MSS target, 0.08 higher than the 2.63 target. Some of the good results achieved in 2007/08 can be attributed to the milder weather experienced again during the year compared to 2005/06. The milder weather is demonstrated by the fact that no exception events occurred in 2007/08. In fact there have been no exclusion events since 16 December The 2007/08 storm season analysis is detailed in Section below Urban and Rural Feeder SAIDI The performance of ENERGEX s urban and rural feeders is shown in Figure 29 for 2007/08, and is based on SAIDI calculated on an individual feeder base. This calculates performance on a basis that is more closely aligned to what individual customers would have experienced during 2007/08 and shows the percentage of feeders that experienced interruptions within a number of SAIDI bands. As there were no exclusion events for the period, no normalising of outages was required. The feeders identified for improvement: Are generally radial overhead feeders with higher than average length of exposure; Have high exposure to tree, animal and storm related faults; Are difficult to access due to remoteness; Have higher than average customer densities in urban areas; and Experience performance problems due to asset age and condition. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 74

81 12 Month Urban SAIDI (All Outages) 12 Month Rural SAIDI (All Outages) > > % of Feeders % of Feeders Figure Month Urban and Rural SAIDI Minutes Geographic SAIDI A map showing the variation of total SAIDI across geographic areas based on substation supply boundaries is shown in Figure 30. As there were no exception events for the period, no normalising of SAIDI was required. The performance is shown in SAIDI bands ranging from blue (0 20 minutes) to red ( minutes). The percentage of customers in each of the bands is also shown. A breakdown of SAIDI causes is shown in Section Knowledge of this reliability variation is used to focus vegetation and inspection and maintenance programs. The higher SAIDI band areas are generally in more rural parts of the network which have higher than average lengths of 11 kv exposure to faults from trees and storms and generally take longer to restore supply. The actual SAIDI and SAIFI performance of each zone substation over the last four years is contained in Part B of the NMP. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 75

82 Figure Month Substation SAIDI ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 76

83 9.2.4 Reliability by Hub Table 21 shows the performance of the network by hub and feeder category for all events during 2007/08. As there were no exception events for the period, no normalising of SAIDI was required. The SAIDI, SAIFI and CAIDI figures include planned and unplanned outages, but exclude transmission and generation events (beyond the control of ENERGEX). The figures represent the average performance experienced by customers connected within the respective hub. Hub Overall Urban Rural SAIDI SAIFI CAIDI SAIDI SAIFI CAIDI SAIDI SAIFI CAIDI Central West Metro North Metro South North Coast South Coast West Overall Table Month Hub Reliability for All Events 9.3 Reliability Analysis Storm Season Severity The 2007/08 storm season has been comparatively light in comparison to the 2005/06 and 2006/07 seasons. To the end of June 2008, there were ten storms requiring Level 2 Orange Alert responses and almost 3,500 jobs were raised due to storm damage. These ten events were typical summer storm events with associated high winds, lightning and heavy rain. During 2007/08 over 21,600 lightning ground flashes were recorded in the ENERGEX area of supply and there were seven days where wind gusts exceeded 60 km/h. In comparison, ENERGEX experienced 11 severe storm events in 2006/07, which reinforces the relatively mild storm season of 2007/08. It is of interest to note that during the 2007/08 year no exclusion events were recorded for the ENERGEX distribution area. A detailed summary of the 2007/08 storms and ENERGEX s response is contained in the ENERGEX Summer Preparedness Plan 2007/08 Compliance and Effectiveness Report. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 77

84 9.3.2 System Outage Causes Figure 31 and Figure 32 show the variance of outage causes to urban SAIDI for ENERGEX between July 2003 and June The charts show the normalised performance after removal of exclusion events that exceeded the 2.5 Beta SAIDI per day threshold. Causes of Urban SAIDI Minutes Equip Subs Mal Op Other Lightning 3rd Party No Cause Trees EQ-UG Animals Planned EQ-OH / / / / /08 Note /04 figures are based on energy use. Customer based reporting commenced in 2004/05. Figure 31 - Causes of Urban SAIDI 95 Variances of Causes Urban SAIDI 2007/08 Minutes /07 SAIDI EQ-OH Equip Subs Mal Op 3rd Party No Cause Lightning Trees Animals EQ-UG Planned Other 2007/08 SAIDI Causes Figure 32 - Variances of Causes for Urban SAIDI Figure 33 and Figure 34 show the variance of outage causes to rural SAIDI for ENERGEX between July 2004 and June The charts show the normalised performance after removal of exclusion events that exceeded the 2.5 Beta SAIDI per day threshold. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 78

85 Causes of Rural SAIDI Minutes EQ-UG Other Equip Subs Mal Op Lightning Animals 3rd Party No Cause Planned EQ-OH Trees / / / / /08 Note /04 figures are based on energy use. Customer based reporting commenced in 2004/05. Figure 33 - Causes of Rural SAIDI Variances of Causes Rural SAIDI 2007/ Minutes /07 SAIDI Lightning Trees EQ-OH Other Planned No Cause Animals EQ-UG 3rd Party Equip Subs Mal Op Causes 2007/08 SAIDI Figure 34 - Variances of Causes for Rural SAIDI % Feeder Improvement Program /08 Review The EDSD Review found that the reliability of ENERGEX distribution feeders varied significantly, with the worst 10% having more than double the average outage duration. The EDSD recommendation was to develop a program to improve the reliability of the 10% of worst performing feeders, with the objective of reducing their average outage duration to within 50% of the ENERGEX average. This is referred to as the 10% Feeder Improvement Program (FIP). The 10% FIP for 2007/08 identified a list of 132 feeders of which 98 were urban and 34 were rural. However, due to significant 11 kv network reconfigurations throughout the year, a number of feeders changed names, and some were decommissioned altogether. At the end of the reporting period, the total number of feeders in the 10% FIP was 129, of which 95 were urban and 34 rural. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 79

86 An update on the individual performance of these feeders in the past financial year is provided in Part B of the NMP. During 2007/08, ENERGEX didn t experience any exclusion events due to severe weather. The normalised and exclusion event SAIDI data for the year are therefore identical. The 95 urban feeders (3 of the original 98 had been decommissioned by the end of June) had a feeder SAIDI range of minutes and the 34 rural feeders had a feeder SAIDI range of 33 1,398 minutes. The normalised average SAIDI over three years for the 10% FIP urban feeders at the start of the 2007/08 feeder program was 200 minutes. Twelve months later, for the same feeders, the SAIDI value has fallen to 142 minutes. This represents a 29% improvement. For 10% FIP rural feeders, the SAIDI value has decreased from 564 minutes to 545 minutes, representing a more modest improvement of 3%. These improvements have occurred in the third year of a five year program. With reference to Part B of the NMP, 25 urban and 7 rural feeders were given a Green Tick rating to signify considerable improvement in reliability due to the initiatives undertaken. Ten urban and five rural feeders were given a lower Orange Star rating to signify signs of improved reliability, although it may be at least three to five years before the SAIDI improvements are fully realised. In most cases, the number of outages has reduced for each outage category. This could be a result of the reliability improvements or possibly due to other external factors, such as the relatively light storm season. The contribution to reliability can only be determined after evidence of consistent feeder performance for successive years, although these initial results are encouraging. Figure 35 and Figure 36 compare the number of outages by cause, for the current and previous year, on the urban and rural FIP feeders respectively. The comparisons are based on the normalised performance after the removal of exclusion events. Although there were no exclusion events for 2007/08, events in the previous year require the count to be normalised for comparison purposes. Although the number of unplanned outages on urban and rural FIP feeders has improved overall, the planned component is worse as a general consequence of increased maintenance and reliability works. Significant improvements occurred in the contribution from animals, equipment failures and tree related events on the urban feeders, while outages due to other causes was worse. For the rural feeders, the year to year results are too similar to indicate any significant improvements. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 80

87 40 URBAN OUTAGES ON FIP FEEDERS FIP 07/08 Urban 12 Months Later No of Outages Accidental Animals Lightning No Cause O/H Equip Other Causes Overload Planned Substations Trees U/G Equip Figure 35 - Normalised Count of Urban Outages RURAL OUTAGES ON FIP FEEDERS FIP 07/08 Rural 12 Months Later No of Outages Accidental Animals Lightning No Cause O/H Equip Other Causes Overload Planned Substations Trees U/G Equip Figure 36 - Normalised Count of Rural Outages 9.5 Reliability Reporting Code Requirements The Electricity Industry Code requires an annual independent audit of a distribution entity s performance against the MSS until such time as it can be confirmed that the reported performance is accurate to within ± 5%. In August 2007, ENERGEX engaged external auditors to undertake an independent audit of its MSS performance over the 2006/07 financial year. The auditors conducted a review of the systems used by ENERGEX to capture, collate, process and report its MSS. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 81

88 9.5.2 Audit Results The key findings reported by the external auditors are as follows: The overarching process adopted and described by ENERGEX is consistent with the principles for reporting reliability performance as envisaged by the Electricity Industry Code. ENERGEX continues to improve its well established and robust system of recording and reporting key reliability performance indicators, with a strong focus and commitment to improved internal auditing. ENERGEX has a strong business culture of documenting its critical processes and training staff to support its reliability reporting obligations ensuring consistency in approach and fostering continuous improvements. In the auditors view, the documentation reflects best practice in this area. The key reliability indicators have been calculated in accordance with the Code requirements and they were able to be reconciled using a bottom-up reconstruction from detailed individual outage records. The audit findings confirm that ENERGEX s reported reliability performance for the 2006/07 period is accurate to within ± 5% Accuracy A summary of the estimated accuracy of ENERGEX s reliability figures reported over the last three years is provided in Table 22. This table shows the range of reported reliability inaccuracies arithmetically combined against feeder category assuming all causes of error occur together. Feeder Category Number of Customers as of June 2007 Published 2006/07 SAIDI (min/year) Accuracy Bounds 2004/05 Accuracy Bounds 2005/06 Accuracy Bounds 2006/07 CBD 4, % 10.5% 0% 15.8% -0.3% 0% Urban 859, % 10.0% -7.3% 1.2% -1.7% 0% Short rural 332, % 2.6% -16.1% 8.1% -1.9% 0% Note 1 An overstatement is where the published figure exceeds the corrected figure and an understatement occurs when the published figure is lower than the corrected figure Table 22 - Estimated Accuracy of 2006/07 Reliability Figures Compared to Previous Years ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 82

89 10.0 Reliability Improvement Programs 10.1 Reliability Planning Criteria ENERGEX has established reliability planning criteria for the network (R1 R5) in accordance with the reliability categories defined in Table 23. These criteria are more focused on customer segments than the existing broad reliability categories of CBD, urban and rural. The criteria recognises the increasing expectations of customers and the community for a reliable supply of electricity, the diverse values, functions and needs of the customer classes and the infrastructure and services that can be economically delivered. Category Density Customer Classes kv.a/km R1 >2500 CBD, Large Commercial and Industrial, Essential R Small C&I, High Density Urban R Medium Density Urban R Urban/Rural Fringe/Rural Townships R5 <50 Rural, Island and Remote Table 23 - Reliability Categories Although many of the customer classes associated with the reliability categories have the same loading criteria, it is expected that networks supplying essential community, commercial and industrial load, would generally be planned, designed, operated and maintained to a higher level of reliability than networks supplying other load. In addition, high-density loads of a common class would, by their nature, be easier to service at a consistent level of reliability according to need than low density and mixed loads. Rural towns and townships will have targeted improvement to increase reliability in line with metropolitan areas. Reliability planning criteria will be applied at a feeder level to meet the R1 to R5 standard. Depending on the reliability category for a particular area, different augmentation strategies can be employed. To meet the reliability standard for rural towns/townships under category R4 for example, the following planning principles are applied on a case-by-case basis: Improve failure rate on feeder sections supplying rural townships; Application of recloser(s) on 11 kv feeders on the exit to the town/township; Application of line fault indicators to speed up fault finding; Opportunities to establish a dedicated 11 kv feeder for the town/township load; Opportunities to establish tie capacity to adjacent feeders; and Opportunities to establish rural substations to split up long lengths of 11 kv line Reliability Improvement Principles The purpose of the plan set out below is to raise reliability levels in line with community expectations, to improve the competitiveness of Queensland industries and to satisfy MSS. Reliable and high quality power is important to the efficient functioning of modern society and business and residential users depend heavily on the reliability of electricity supply. Rapidly growing and higher peak demand on ENERGEX s network presents challenges for providing reliable and good quality supply. As technology advances, especially with the development of Smart State industries, ENERGEX will meet the challenge in supply reliability. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 83

90 In 2007, the DME reviewed the MSS standards for the next five years. It recommended to the Jurisdictional Regulator that MSS targets for quality of supply be developed jointly for inclusion in the next review of the Code. There are opportunities for ENERGEX to focus on reliability and power quality improvements across its network. ENERGEX has adopted three fundamental principles for improving reliability of its network. These are broadly categorised as: 1. Reduce the number of sustained faults; 2. Reduce the number of customers affected per fault; and 3. Improve the speed of restoration of supply. The number of faults is being addressed by identifying root causes and adopting site specific solutions or program solutions to eliminate or mitigate these root causes. This may involve use of capital funds to reconductor mains, improve protection clearing times or replace bridges and connectors. Other options include the use of insulated conductors, redesigned spacings to minimise conductor clashing, removal of redundant mains or rerouting of mains. The number of customers affected by a fault is being addressed through the use of remote controlled reclosers and switches and the establishment of new substations and/or feeders to split the network into reasonably sized segments. The speed of restoration is being addressed through various initiatives. They include the use of overhead line indicators and cable fault indicators on the 11 kv network. Other technical solutions include the installation of distance to fault relays on the 33 kv network and remote controlled reclosers/switches on the feeder backbones and normally open tie points. Operational enhancements such as more efficient deployment of crews and improved network emergency response procedures focusing on restoration before repair, also assist to reduce outage time The Code s Reliability Targets for the Next Five Years Minimum Service Standards Minimum Service Standards (MSS) are prescribed in the Code to provide a standard against which a distribution entity s feeder performance can be assessed across the network and from year to year. Two reliability measures are defined as follows: System Average Interruption Duration Index (SAIDI) limits; and System Average Interruption Frequency Index (SAIFI) limits. SAIDI indicates the total minutes, on average, that customers are without electricity during the relevant period. By contrast, SAIFI indicates the average number of occasions each customer s supply is interrupted during the relevant period. Table 24 sets out the MSS targets as stated in the Code. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 84

91 SAIDI MSS (mins) 2007/ / / / / / / /15 CBD Urban Short rural SAIFI MSS (no.) 2007/ / / / / / / /15 CBD Urban Short rural Note 1 Targets for 2010/11 to 2014/15 are indicative and subject to change within the Code. Table 24 - Minimum Service Standards Circumstances beyond the distribution entity s control are generally excluded from the calculation of SAIDI and SAIFI metrics. In particular, the Code excludes the following events from MSS calculations: An interruption of a duration of one minute or less (momentary); An interruption resulting from load shedding due to a shortfall in generation; An interruption resulting from a direction by the National Electricity Market Management Company (NEMMCO), a system operator or any other body exercising a similar function under the Electricity Act, National Electricity Rules or National Electricity Law; An interruption resulting from automatic shedding of load under the control of underfrequency relays following the occurrence of a power system under-frequency condition described in the power system security and reliability standards; An interruption resulting from failure of the shared transmission grid (Powerlink); An interruption resulting from a direction by a police officer or another authorised person exercising powers in relation to public safety; An interruption to the supply of electricity which commences on a Major Event Day 1 ; and An interruption caused by a customer s electrical installation or failure of that electrical installation. To achieve acceptable service standards, ENERGEX has set performance targets that are at least 10% below (better than) the specified MSS. Due to inherent statistical variability in reliability performance from year to year, mainly due to adverse weather, a more stringent target is necessary to minimise the risk of non-compliance in unfavourable years. These targets are shown in Figure 37 and Section 9.1 reports on the actual performance achieved in 2007/08 1 A Major Event Day is defined under the IEEE 1366: 2.5 Beta method and is one in which the daily system SAIDI exceeds a threshold value that indicates performance is well outside the norm. Excluding Major Events from MSS calculations allows the performance trends to be studied without the data distortion that would otherwise occur from such extreme events. The analysis of these trends enables ENERGEX to focus its resources efficiently and effectively in the areas that will deliver maximum benefits to customers. For 2007/08, the SAIDI threshold for a Major Event Day was 6.1 system minutes. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 85

92 ENERGEX Targets versus MSS Urban_MSS Urban_ENERGEX Rural_MSS Rural_ENERGEX SAIDI (minutes) /05 05/06 06/07 07/08 08/09 09/10 Figure 37 - MSS and ENERGEX s Targets Guaranteed Service Levels The Code also specifies a range of GSLs that distribution entities must provide to their customers. Failure to meet such GSLs requires the payment of financial rebates to any customer whose service has been inadequate. Whilst most of the GSLs are not network related, reliability service levels as shown in Table 25, are relevant to network planning, and like the MSS, may drive network development. Depending on a customers feeder type, limits are defined for acceptable outage durations and frequency of interruptions. There are exemptions to these requirements as per the MSS schedule, with planned interruptions providing an additional exception. Feeder Type Interruption Duration GSL (for each incident) Interruption Frequency GSL (No per financial year) CBD > 8 hours 10 Urban > 18 hours 10 Short rural > 18 hours 16 Table 25 - Reliability GSLs 10.4 Existing Reliability Improvement Programs Rural Reliability Program The reliability of a distribution network is intrinsically dependent on the network configuration, its design characteristics, the operating environment and the practices employed in its maintenance. Factors such as customer density, operating environment and geographic service area influence the design and the economic and safety factors to deliver a service acceptable to customers. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 86

93 The majority of rural customers are supplied from an overhead radial network. The dominant supply characteristics are long lengths of radial 11 kv feeders with limited normally open tie points to adjacent feeders, and their exposure to storm events (wind and lightning). One of the issues is the development of loads in new areas that have left existing zone substations no longer optimally located near the centre of the serviced area. This has resulted in longer than desired 11 kv feeders that, although meeting voltage and current requirements, have a higher exposure to various fault types due to their increased length. RRR stage 1 focused on installing reclosers to reduce the number of customers affected by a fault. This program improved rural SAIDI by 2006/07. Following the success of stage 1, RRR stage 2 was commenced in 2007 and is likely to produce further reductions in rural SAIDI. ENERGEX s rural substation program over the next five years (2008/09 to 2012/13) has been developed to address capacity and voltage limitations of the zone substations and/or 11 kv feeders as well as the reliability of the worst performing feeders. The proposed rural substations are located within or near the major townships close to existing 33 kv feeders and near 11 kv node points. The rural substation program will address the majority of the identified worst performing feeders towards the end of the five year POW Feeder Improvement Programs For the urban network, ENERGEX has met the service obligation for the worst performing feeders with the urban three year average as of June 2008 being 142 SAIDI minutes. This improvement has ensured the urban network will achieve the MSS target of 165 SAIDI minutes by 2009/10. For the rural network, the three year average of the worst performing feeders as of June 2008 was 564 SAIDI minutes. To achieve the rural MSS target of 330 minutes by 2009/10, an improvement of 234 minutes is required. This improvement, if attained, would contribute around 22 SAIDI minutes towards the achievement of MSS on the rural network by 2009/10. ENERGEX has now finalised the 10% FIP to be actioned in 2008/09 and beyond. Details of these feeders and the proposed capital and operating plans to improve their performance are contained in Part B of the NMP. In summary, the 10% FIP for 2008/09 has identified 136 feeders, of which 101 are urban and 35 are rural. These are illustrated in Figure 38. This compares to the 96 urban and 34 rural feeders identified under the preceding NMP. Faults on these feeders have been due to a variety of causes including trees, equipment failure, lightning/storms and animals. Rural, % Rural, 35 10% WPF, 136 Urban, % Urban, 101 Figure 38 - Breakdown of Feeder Improvement Program for 2008/09 ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 87

94 Including severe weather events, the 101 urban feeders have a three year average feeder SAIDI range of minutes, and the 35 rural feeders have a three year average feeder SAIDI range of 485 1,460 minutes. When severe weather events are removed, the 101 urban feeders have a three year average SAIDI range of minutes and the 35 rural feeders have a three year average SAIDI between minutes. The average (2005/06 to Mar 08) performance of the urban feeders was 129 minutes and the rural feeders 490 minutes. Twenty two urban and five rural feeders identified on the list have significantly improved their most recent average (2006/07 to Mar 08) performance and have achieved greater than a 40% reduction when compared to the three year reported history. These feeders are no longer expected to be a reliability concern and are not expected to require any improvement works in this plan. Eight urban and six rural feeders identified on the list have shown encouraging signs of improvement with the most recent average (2006/07 to Mar 08) achieving greater than a 20% reduction when compared to the historical three year average. These feeders will need further monitoring over the next 12 months and will have a lower priority for improvement works in this plan. The remaining 95 urban and rural feeders on the list are expected to have some level of improvement proposed in this plan. This improvement plan is based on a thorough examination of the feeders characteristics and the underlying reasons for their poor performance. In some cases, specific one-off causes have been identified which require no further action. In others cases, capacity and refurbishment upgrades have been identified that deliver reliability improvements. Where possible these schemes are accelerated under this program. More than 20 new zone substation sites are planned for establishment or upgrade in rural and urban areas between 2008/09 and 2012/13 to split the 11 kv network into smaller lengths. Other initiatives include remote control of line switches, installation of new line hardware to prevent faults on the overhead network, and an extensive vegetation management program Planned Reliability Improvement Programs Short Term Reliability Initiatives To achieve the proposed reliability improvement targets over the next two years, the following short term capital initiatives have been identified: Continue the feeder improvement program to focus on poorly performing 11 kv feeders, determine the root cause on an individual basis and develop and implement plans for improvement; Continue the focus on vegetation management; Wildlife proof exposed energised equipment to minimise outages caused by animals; Install automatic circuit reclosers and sectionalisers on rural feeders to limit the number and extent of sustained supply interruptions due to faults (SAIFI benefits); Increase capability for remote switching on the distribution network through the establishment of a digital mesh radio communications network to replace the existing analogue system (CAIDI benefits); Retrofit all existing non-remote controlled switch (reclosers and sectionalisers) sites and convert all existing analogue radio sites to the new digital communication network; and Commence installation of remote control load transfer schemes on the urban network and the rural network where opportunities for ties can be economically established. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 88

95 Longer Term Reliability Initiatives The following longer term reliability initiatives are proposed: Redesign and replace problematic overhead equipment (eg. small conductors, bridges, clamps and narrow trident steel crossarms with reduced conductor spacings) across the entire network, particularly in conjunction with other upgrade work requirements (eg. with fault level increases); Reduce exposure lengths of the primary distribution system by establishing more injection points from the sub-transmission system. More zone substations will increase the number of protection switches servicing a given area, leading to fewer customers affected per fault and a consequential improvement in reliability; Continue the deployment of remote controlled switches in the urban distribution network to reduce the time taken to restore supply following faults; and Implement revised undergrounding policies. It is generally accepted that an underground distribution system, while more costly, is more reliable than an overhead system due to less influence from environmental factors (eg. vegetation, storms, motor vehicle accidents and animals). High risk areas, such as traffic accident black spots and high corrosion areas will be targeted Capital Expenditure Initiatives Five Year Capital Expenditure Program (2008/09 to 2012/13) There are two components to the Five Year Capital Program: The Transmission Augmentation Program lists the large site specific project works that often span multiple financial years. Although mainly involving transmission and subtransmission works, the Transmission Augmentation Program also includes necessary distribution works; and The Distribution Augmentation Program lists collections of smaller projects mainly associated with customer works for each financial year, that are managed over geographic areas. The 2008/09 to 2012/13 NMP identifies projects to meet the planning guidelines outlined in Table 7 and to meet the reliability targets listed in the Electricity Industry Code. The Transmission Augmentation Program includes: Augmentation or construction of new transmission feeders; Augmentation or construction of new sub-transmission feeders; Augmentation or construction of new bulk supply substations; Augmentation or construction of new zone substations; Major 11 kv feeder works, Reliability projects; and Refurbishment of aging plant. The Distribution Augmentation Program is estimated from previous trends for each work category, economic activity indicators and expected requirements for special programs and commitments. These works include: Domestic and rural connections; Industrial, commercial, traction and public lighting connections; ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 89

96 Augmentation of the 11 kv and LV distribution network associated with increasing demand; Replacement and refurbishment of distribution equipment such as poles, ABSs and crossarms; Replacement of concentric services; Quality of supply improvement projects; Undergrounding of overhead community beautification projects; and Installation and upgrade of services and meters. ENERGEX s Capital Expenditure (CAPEX) proposals out to 2011/12 for the electricity network are summarised in Table Year Capital Expenditure Plan $M (Nominal) / / / / /13 Capital Works - Transmission Capital Works - Distribution CAPEX Total Note 1 Nominal dollars shown include non system depreciation. Note 2 Forecast expenditure beyond the current regulatory period could be revised depending upon the AER determination for 2010/11 to 2014/15. Table 26 - Summary of Capital Expenditure Capital Expenditure Targets The major projects for 2008/09 are listed in Appendix 4, Table 37. The list includes all specific (ie. not general bucket type projects) capital works projects with Approval as of February 2008 when the POW is baselined; A total escalated cost of $1 million or more; and A scheduled completion date within the coming financial year. Although the list includes distribution projects, infrastructure projects and customer driven projects fitting the above criteria, delivery of works within the last two categories particularly, are subject to outside influences. Changing customer requirements and delays to infrastructure projects can result in such projects being deferred. These variations are usually accommodated by bringing forward other works, albeit with some inefficiency costs caused by the disruption and rescheduling. The total capital program for 2008/09 has many other components and a summary of major programs with their 2008/09 targets is listed in Table 27. Activity Per 2008/09 Target 11 kv Distribution feeder upgrades feeder 101 Install PMRs, sectionalisers and load transfer switches switch 315 Six Sigma pole nailing program nail 3,600 MDI distribution transformer upgrade program transformer 445 Upgrade pole transformers ( kv.a) transformer 268 Replace open wire overhead mains with LV ABC km 24 Replacement of concentric and open wire services service 19,901 Increase in installed bulk supply substation capacity MV.A 120 Increase in installed zone substation capacity MV.A 705 HV 7/.064 conductor replacement km 120 Table 27 - Capital Expenditure Targets for 2008/09 ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 90

97 Network Refurbishment Network assets are subject to a range of degradation mechanisms that over time reduce the capacity of the asset to fulfil its required function. Degradation mechanisms include corrosion and decay that can reduce structural integrity and produce deterioration of insulation materials. The consequences are an increased risk of insulation breakdown and mechanical wear and tear. In addition, obsolescence may render some items of network equipment unserviceable due to the non-availability of support and replacement parts. Network refurbishment programs are being developed to identify and restore or replace assets that are nearing the end of their lifecycle and are not otherwise being replaced during the course of network capacity upgrades. These programs factor in the benefits of future reductions in operating costs and are based on a technical assessment of the serviceability of the asset and the economics of replacement or refurbishment. Detailed programs are being developed for all key asset classes as follows: Bulk and zone substation transformers (power and station); Bulk and zone substation circuit breakers (132/110/33/11 kv both indoor and outdoor); Bulk and zone substation infrastructure; 132/110 kv overhead lines; 110 kv underground cables; 33 kv overhead lines; 33 kv underground cables; Distribution overhead (11 kv and low voltage including conductors, ABSs, reclosers, sectionalisers and regulators); Distribution underground (11 kv and low voltage); and Distribution substations (11 kv transformers, ring main units and low voltage boards). ENERGEX is currently applying a Condition Based Risk Management (CBRM) methodology to assess the assets in these asset classes. CBRM is a process based on building a definition of current and future asset condition and performance and quantifying risk by using asset information and engineering knowledge of the assets. The risk assessment is used to ensure the most appropriate use of capital funds whilst maintaining a balanced approach to the overall network condition. The CBRM process can be defined by a series of sequential steps. 1. Define asset condition Derive health indices for individual assets and build health index profiles for asset groups. Health indices range from 0 to 10 with 0 indicating the best condition and 10 the worst. 2. Link current condition to performance Calibrate the health index against the relative probability of failure. 3. Estimate the future condition and performance Use knowledge of the degradation process to age the health indices. Calculate future failure rates based on the aged health index profiles. 4. Evaluate potential interventions in terms of probability of failure and failure rates Factor in potential replacements, refurbishment or modified maintenance regimes. 5. Define and weigh consequences of failure Populate a framework to evaluate consequences of failure in significant categories such as safety, network performance, environmental and financial costs. 6. Build a risk model Combine probability of failure and criticality of failure to quantify risk. 7. Evaluate potential interventions in terms of risk Factor in the effect of potential replacement, refurbishment or changes to maintenance regimes to quantify risk reductions. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 91

98 8. Review and refine information and process Identify opportunities to improve asset information and condition data. Figure 39 shows the relationship between the health index and the probability of failure and can be summarised as follows: Low health index values from 0 to 4 represent some observable or detectable deterioration at an early stage. This can be considered normal ageing. Medium health index values from 4 to 7 represent significant deterioration. The degradation processes are starting to move from normal ageing to processes that potentially threaten failure. High health index values greater than 7 represent serious deterioration. Degradation processes are advanced and are reaching the point where they actually threaten failure. The probability of failure is significantly raised and the rate of further degradation will be relatively rapid. Health Index and Probability of Asset Failure Probability of failure (P f ) Measurable deterioration but no significant increase in P (f) Significant deterioration small increase in P (f) Serious deterioration significant increase in P (f) Health Index Figure 39 - Health Index and Probability of Asset Failure CBRM has been completed on two asset classes to date; 11kV circuit breakers and 11kV ring main units. All other asset classes are currently being evaluated and the results will be utilised to develop the asset refurbishment plans from 2009/10 forward, including ENERGEX s AER submission Operating and Maintenance Expenditure Initiatives Five Year Operating Expenditure Program (2008/09 to 2012/13) ENERGEX s operating expenditure proposals for the period 2008/09 to 2012/13 for the electricity network are summarised in Table 28. The OPEX expenditure for the period 2008/09 to 2009/10 is ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 92

99 in line with the QCA determination except for infrastructure projects. These infrastructure projects were not known at the time of the QCA determination and are the subject of a pass-through application to the QCA. Operating Expenditure Forecasts ($M) 2008/ / / / /13 Inspection Planned Maintenance Corrective Repair Emergency Response/Storms Vegetation Streetlights Customer Service Network Operations DSM Network Support Services Recoverable Works Expenditure Temporary Builders Service Sub-Total Less Estimated Shared Asset Depreciation na na na OPEX Total related to QCA Allowance na na na QCA Final Determination April na na na Recoverable Works - Electricity Retailers Telecommunications Services Non Distribution Services - Other Recoverable Works Infrastructure Projects Total Additional Self-funded OPEX OPEX Total Note 1 Nominal dollars shown. Note 2 Forecast expenditure beyond the current regulatory period could be revised depending upon the AER determination for 2010/11 to 2014/15. Table 28 - Summary of Operating Expenditure Operating Expenditure Targets In accordance with the MAMP and SAMP outlined in Section 6.1, a range of operating and maintenance activities are planned for 2008/09 to ensure ENERGEX is operating an optimal supply network in terms of plant and equipment reliability. These are summarised in Table 29 and described more fully in the following sections. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 93

100 Activity Per 2008/09 Target Sector based vegetation (distribution) km 13,500 Feeder based vegetation (transmission) km 1,130 Pole inspection program pole 125,050 LV Preventative crossarm replacements crossarm 8, kv Preventative crossarm replacements crossarm 3, kv Preventative crossarm replacements crossarm kv Pre-storm feeder patrols feeder 1, kv Pre-storm feeder patrols feeder /110 kv feeder patrols feeder 133 Read Maximum Demand Indicators (MDIs) site 14,968 Install wide trident pole 500 Replace neutral clamps on LV services clamp 10,500 Installation of LV spacers spacer 12,500 On load tap changer maintenance OLTC 112 Table 29 - Operational Expenditure Targets for 2008/ Inspections Asset inspections in the distribution area include systems based maintenance inspections, prestorm feeder patrols (by car and helicopter), thermographic inspections, inspection of ground installed plant (RMUs, ground transformers and pad mounted transformers), inspection of overhead plant (pole transformers, reclosers and associated DSA equipment) and post fault operation patrols. In the transmission area, activities include inspection of substations and buildings, inspection of high voltage plant, oil condition analysis and diagnostic testing, and inspection of high voltage lines and cables. Significant inclusions in the 2008/09 POW are listed in Table Planned Maintenance ENERGEX employs action-based maintenance where practicable. Rather than simply reporting defective conditions, skilled assessors nominate what remedial action is required. The maintenance is driven by the inspection programs and by reliability improvement requirements. This includes the cost of dismantling existing assets not associated with capital or recoverable works. Significant inclusions in the 2008/09 POW are listed in Table Corrective Maintenance Corrective Maintenance is defined as The immediate repair work carried out to restore the asset to a temporary / permanent state in which it can perform its required function. The corrective repair is complete when the work has made safe the asset and restorated supply for the network to operate in a safe manner. Follow up repairs are Planned Maintenance. Corrective repair inclusions in the 2008/09 POW are based on historical observation of previous failure rates. From these failure rates, Standard Job costs determine the POW budget provision. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 94

101 Storms and Emergency Response Storms and disaster coordination includes field costs to repair storm damage. This is usually triggered by a Level 2 storm event (ie. when Storm Rooms are operational). Budget provisions cover both Emergency Response and Storms/Emergency Response. The level of funding has been determined from historical experience over previous years Vegetation Management ENERGEX seeks to minimise risks associated with vegetation around overhead assets to maximise public safety. This is managed through a combination of a planned tree trimming cycle, planned vegetation management to target areas recognised as above acceptable risk and unplanned vegetation management to manage events triggered by customer requests or network events. A 30 month cycle time for rural with 15 month cycle time for HV lines in urban areas has been adopted and budget set based on long term lump sum contract rates. Additional provisions made to manage vegetation on transmission line easements are based on contract rates. Funding has been made for the assessment of feeders using the visual tree assessment methodology to target reliability improvements for vegetation outside the cyclic profile Public Lighting (Streetlights) Public lighting assets are maintained to meet the requirements of the applicable tariff conditions and the applicable Australian Standard. The MAMP specifies a condition monitoring approach to determine component deterioration through regular patrols. These are performed both day and night with specified maximum intervals for rectification of observed defects. Budget provision has been made, based on existing contract arrangements, to conduct patrols in accordance with the MAMP specifications. In addition, a provision has been made for repairs arising from these patrols based on historical observed failure rates. In order to improve public safety, a further provision has been made for a specifically targeted program to inspect and rectify faulty neutral connections on a limited number of streetlights identified by their age and type Other Operating Initiatives In addition to the specific programs above, a number of more generalised items are provided for under the operating budget. These include customer service payments (GSL), network operations (switching costs), DSM (eg. installation of generators for load support), recoverable works (eg. customer requested network relocations), recoverable works for electricity retailers (eg. disconnects, reconnects), builders temporary services and non distribution services (eg. high load escorts). ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 95

102 11.0 Risk Management of Major Constraints 11.1 Approach A five year capital works program has been developed to address the following specific areas: Provide for forecast demand growth of 5% compounded over the next five years. Over recent years, significant growth has occurred in residential customer electricity loads due to a range of factors including dwelling sizes, styles and density and changing consumer preferences for whitegoods and air-conditioning. Improve network security and reduce the utilisation to 60 65% for all substations and reduce the amount of load at risk. This level of utilisation will allow the network to maintain normal supply even during extreme weather events. Improve overall reliability over the next five years. These improvements are required to meet increasing customer expectations and comply with ENERGEX s MSS. Renew older assets to maintain network reliability and improve network security. In the coming years, many power transformers and underground cables will near the end of their economic lives. Improve community amenity by improving the safety of the network and working with local and State Governments to underground key parts of the network Building for Security, Quality, Reliability and Availability The purpose of the plans set out below is to ensure: 1. Security - improve the security of the electricity transmission and sub-transmission network towards the effective N-1 standard, whereby any major disruption will be largely mitigated by an alternative source of supply for the backbone of the network; 2. Quality - provide quality of supply to meet customer needs; 3. Reliability - improve reliability to meet MSS targets and satisfy customer category requirements; and 4. Availability - ensure that the network has adequate capacity and demand management capability to meet forecast growth scenarios for population, electricity demand and commercial and industrial development. The EDSD Review recommended that the network utilisation be reduced to between 60 and 65% over five years and that this be achieved by using deterministic planning methodologies (ie. network planned to N-1 criteria). ENERGEX has committed to actioning all of the EDSD Review recommendations. Action plans have been developed and the following tasks have commenced or been concluded: Implementation of new planning guidelines and technology to match customer expectations; Preparation of 50 PoE and 10 PoE forecasts for each substation for the next five years based on adjusted growth rates; Update of the Network Strategic Development Plan to identify new sites required to meet the planning criteria and achieve a network utilisation of less than 60%; Preparation of the Network Development Plan (NDP) for the next five years identifying projects and capital required to meet network utilisation and security targets; and Preparation of contingency plans for sub-transmission network elements which do not meet planning guidelines. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 96

103 11.3 Security Risks Bulk Supply and Zone Substation Security Projects have been initiated to address all forecast future overloads above normal cyclic capacity (NCC) of bulk supply and zone substations in the longer term. Contingency plans have been prepared for substations where the forecast load at risk is unacceptable for N-1 conditions. These plans specify load transfers and other activities that enable rapid response to minimise interruptions due to or following faults and are detailed in Part B of the NMP. The longer term strategy to increase the N-1 network substation capacity in order of priority is: Upgrade existing substations to meet demand growth; Construct new bulk supply substations in accordance with the Network Strategic Development Plan to meet demand growth and increase N-1 capacity; Construct new zone substations in urban areas in accordance with Network Strategic Development Plan to meet demand growth and increase N-1 capacity; and Construct new zone substations in rural areas to improve rural reliability. Under the planning guidelines in Table 7, substations are considered to be fully N-1 compliant if load can be completely restored within 15 minutes for an N-1 contingency. The Technology Plan has proposed the installation of a significant number of remotely controllable switches across the network to improve reliability and N-1 security. These switches will allow load transfers within 15 minutes to comply with planning guidelines. Although the implementation of 11 kv remotely controllable switches has not been factored into forecasts, the forecasts do allow for existing manually switched load transfers for substations with an N-1(b) security category. Such load transfers form the basis of most contingency plans. With the current strong demand growth, full compliance with the N-1 planning standard will not be achieved within the next regulatory period. Table 30 shows the projection of bulk supply and zone substation statistics to 2012/13. Over the next five years, six new bulk supply and 52 new zone substations will be constructed to keep pace with the growing demand. These will see the percentage of bulk supply substations with N-1 load at risk decrease from 41% in 2007/08 to 30% in 2012/13. Similarly there will be a comparative improvement for zone substations from 51% to 34%. Substation utilisation over this period will also be reduced as a consequence of these works. Although the new demand forecast has reduced slightly in the medium term, the utilisation of substations is expected to be below 60% as recommended in the EDSD Review. Substation Type Substation Loading 2005/06 Qty 2006/07 Qty 2007/08 Qty 2008/09 Forecast 2012/13 Forecast Bulk Supply Demand > NCC 1, Demand > N Total Substations Zone Demand > NCC Demand > N Total Substations Note 1 Based on 10 PoE forecasts or actual demands. Minor overloads (<1 MV.A) that can be covered by transfers are excluded. Note 2 Based on 50 PoE forecasts or actual demands. Minor overloads (<1 MV.A) that can be covered by transfers are excluded. Note 3 From 2007/08, zone substations include customer installations with voltage transformations. Note 4 Cable, switchgear and load sharing limitations are included from 2007/08. Table 30 - Bulk Supply and Zone Substation Loading Forecasts ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 97

104 It is forecast that one bulk supply substation will exceed its NCC rating in 2008/09. A project is in place to solve this limitation before the summer of 2009/10. The number of bulk supply substations with N-1 limitations will temporarily increase from 15 in 2007/08 to 23 in 2008/09 before reducing to 13 in 2012/13. The number of zone substations exceeding their NCC rating will increase to 14 in 2008/09 and then decrease to zero in 2012/13. Similarly, the number of zone substations with N-1 limitations will increase to 121 in 2008/09 before reducing to 90 in 2012/13. The reduction in substation security in 2008/09 is primarily due to the delayed completion of the 2007/08 capital works. It is not expected that this reduction in network security will have significant impacts on customer reliability as each risk is treated using site specific contingency plans and operational strategies. The network security risks need to be further mitigated to comply with ENERGEX policies however, and ENERGEX s submission to the Australian Energy Regulator for the next determination may be seeking additional funds for this purpose /110/33/11 kv Feeder Security The number of 132/110 kv feeders exceeding the ECC rating is expected to increase to 27 in 2008/09 and increase further over the next five years to 35 in 2012/13. Four 132/110 kv NCC limitations are expected in 2008/09 and should reduce over the next five years to zero. For the 33 kv feeder network, the number of feeders exceeding the NCC rating will increase to 21 in 2008/09 then fall back to zero in 2012/13. The number of feeders exceeding their rating for an N-1 contingency will increase to 176 in 2008/09 and reduce to 98 by 2012/13. The reduction in 132/110/33 kv security in 2008/09 is primarily due to the delayed completion of the 2007/08 capital works. It is not expected that this reduction in network security will have significant impacts on customer reliability as each risk is treated using site specific contingency plans and operational strategies. The network security risks need to be further mitigated to comply with ENERGEX policies however, and ENERGEX s submission to the Australian Energy Regulator for the next determination may be seeking additional funds for this purpose. As for substations, the installation of remotely controllable switches will improve feeder security. These have not been factored into the forecasts. Due to constraints within the analysis tools, the forecasts also do not allow for existing manually switched load transfers for those sub-transmission feeders with an N-1(b) security category. Table 31 below shows the projection of 132/110 kv feeder statistics to 2011/12. Table 32 and Table 33 show the forecast 33 kv and 11 kv feeder loads respectively. System Configuration 132/110 kv Feeder Loading 2005/0 6 Qty 2006/07 Qty 2007/08 Qty /09 Forecast 2012/13 Forecast Normal Demand > 1.0 NCC 1, N-1 Demand > 1.0 ECC 2, Total Feeders Note 1 Based on 10 PoE forecasts or actual demands. Minor overloads (<1 MV.A) that can be covered by transfers are excluded. Note 2 Based on 50 PoE forecasts or actual demands. Minor overloads (<2 MV.A) that can be covered by transfers are excluded. Table /110 kv Feeder Loading Forecasts ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 98

105 System Configuration 33 kv Feeder Loading 2005/06 Qty 2006/07 Qty 2007/08 Qty 2008/09 Forecast 2012/13 Forecast Normal Demand > 1.0 NCC N-1 Demand >1.0 ECC Total Feeders Note 1 Based on 10 PoE forecasts or actual demands. Minor overloads (<5 A) that can be covered by transfers are excluded. Note 2 Based on 50 PoE forecasts or actual demands. Minor overloads (<5 A) that can be covered by transfers are excluded. Note 3 The ECC rating is the same as the NCC rating for all circuits except transformer cables. Note 4 Includes normally open feeders but not T-off feeders. Table kv Feeder Loading Forecasts 11 kv Feeder Loading 2005/06 Qty 2006/07 Qty 2007/08 Qty 2008/09 Forecast 2012/13 Forecast Demand > 1.0 NCC , Total Feeders 1,489 1,579 1,700 1,800 na Note 1 Based on temperature corrected summer 10 PoE loads, using temperature data for Archerfield during 2005/06 and 2006/07 and Amberley for 2007/08. Note 2 Of the 55 feeders, 22 exceeded NCC by only 1 to 3% of rating. Table kv Feeder Loading Forecasts Substation Land Acquisition and Powerline Easements New zone and bulk substations are forecast to be established over the next ten years to meet the capacity growth and to improve the reliability of the primary distribution system. Strategic planning studies have identified the location of these new substation sites and in excess of 50 new substations may be required in South East Queensland over the next five years. A number of major power line corridors to enable connection of new substations or improve the security of the sub-transmission system have also been identified in these studies. ENERGEX needs to acquire properties and easements well in advance of construction of network assets to ensure their availability and the certainty of planning approvals. Many of the new substation sites will be required in existing and established areas where land may be scarce or in high demand. At the same time, changing community and stakeholder expectations require a more balanced approach than has been used in the past; particularly in regard to visual amenity, EMF exposure, perceived reductions in property value and environmental impacts. Key aspects of this approach ensure: The Network Strategic Plan aligns with the South East Queensland Regional Plan and updated Local Council Planning Scheme information to more accurately reflect the future land use to allow for potential network loading, thus identifying long term network property requirements. ENERGEX assets are included in Local Government Planning Schemes and appropriate assessment levels are assigned through continued liaison with local councils and the Department of Infrastructure and Planning. Earlier and more rigorous community and stakeholder engagement is established to provide transparency and to reinforce the need for, and benefits of the proposed substations or powerlines. By also demonstrating that alternatives are considered, such consultation is more likely to achieve proposal acceptance. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 99

106 Improved processes for site and easement selection to provide more transparency of the need and the reasoning behind the selection Power Transformers The life of a power transformer is primarily determined by the condition of its internal paper insulation and the mechanical/electrical integrity of its associated on-load tap changer equipment. ENERGEX has a continuing program for assessing the insulation condition of its power transformer population using oil analysis and where practicable, by directly assessing samples of transformer insulation removed from the transformer. These techniques are widely used throughout the electricity supply industry and allow the likelihood of future insulation failure to be predicted with reasonable confidence. The likelihood of future failure assessments is a key input into the formulation of CAPEX augmentation projects and is used to prioritise transformers for replacement or refurbishment. Information on insulation condition can also provide insight into the rate of ageing of the power transformer asset population. Analysis has found that some classes of power transformer are exhibiting an increased rate of ageing in comparison to the population at large. Further analysis is being undertaken to understand the causes of premature ageing. Currently ENERGEX performs diagnostic gas analysis on 110 kv and 132 kv transformers every year and on 33 kv transformers every two years. From this data furans (heterocyclic organic compounds) are analysed to determine the insulation degradation. This condition data is used as an input to develop the Condition Based Risk Management (CBRM) health indices for the power transformer population. This work is underway and will be utilised to prepare future power transformer replacement programs. Any proposed replacements based on end of life criteria are carefully assessed in relation to capacity requirements to ensure appropriate use of capital funds Distribution Transformers ENERGEX is intending to upgrade/replace an increased number of distribution transformers in 2008/09 compared with 2007/08. The increased upgrade rate should reduce the highly overloaded transformer population to acceptable levels over the next few years. Table 27 has details of forecast replacement quantities. During 2007/08 ENERGEX replaced the last of its population of transformers containing scheduled levels of Polychlorinated Biphenyl (PCB). This was in line with an environmental management program that had been developed in conjunction with the Environmental Protection Agency Network Contingency Planning Overview ENERGEX reviews its contingency plans for managing network failures and events such as exceptional hot weather on an annual basis. Detailed plans were in place for summer 2007/08 and planning for summer 2008/09 has commenced. The contingency plans encompass a number of aspects: Network contingency and load shift plans to cater for single contingencies - equipment failure; Strategies for spares and replacement of major plant such as power transformers; Emergency response procedures covering management of major network incidents, including escalation as documented in the Corporate Emergency Management Plan; ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 100

107 Simulation exercises to test procedures under different scenarios; Application of mobile generators to provide an emergency supply in situations where it is possible; Deployment of two ENERGEX-owned 33/11 kv mobile substations; Application of available NDM options; and Installation of online condition monitoring equipment on power transformers Contingency Plans for Summer (System Normal Conditions) Immediately after summer each year the whole network is reviewed to ensure that all substations and feeders can supply a 10 PoE load for the following summer under system normal conditions (ie. NCC ratings). Where existing ratings are not adequate for the following summer s 10 PoE loads and augmentation works may not be completed in time to avert the possible deficit, shortterm mitigation strategies are developed. These strategies may include a range of load transfers, small capital works projects (possibly temporary), or NDM options such as generation or customer load curtailment. ENERGEX has also developed a process to monitor loads on a weekly basis during the summer period so that as hot weather develops, load forecasts can be amended if required. This process identifies emerging hot spots where demand growth may have exceeded the previous annual forecasts. In these cases, corrective action to avoid an overload is taken well before a capacity constraint occurs arises Contingency Plans for Summer (N-1 Conditions) Network contingency plans detail what load transfers and load management options are available to restore supply following a single contingency event affecting bulk supply substations, zone substations and HV feeder networks. As part of the summer preparedness plans, ENERGEX develops plans for all bulk supply substations, zone substations and 132/110/33 kv feeder networks. In cases where load transfer capability is not sufficient to enable supply to be restored following a single contingency, further more detailed plans are developed. These plans include strategies such as the positioning of spare power transformers at substations considered to be at high risk (high likelihood or significant consequence) of an extended outage due to a major transformer or circuit failure. Identified N-1 conditions are provided as input into the network development planning process. Network contingency plans addressing remaining capacity risks for the next 12 months have commenced Power Transformer Contingency Plan Spare power transformers are managed by a Transformer Movements Committee, which meets on a quarterly basis, or more regularly if required. This committee consists of representatives from a number of divisions across ENERGEX including Network Performance, Energy Delivery and Network Programming and Procurement. The committee s objective is to ensure optimal use of all available transformers, for both planned and emergency use, taking into account the relative network risks at each location. Issues addressed by the committee include: Ensuring there are sufficient numbers of spare transformers (of appropriate sizes) for emergency use in the event of a transformer failure at any ENERGEX substation; and ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 101

108 Determining whether transformers being replaced as part of planned capital projects should be overhauled and reassigned to another substation, kept as system spares or scrapped (due to being uneconomical to refurbish). The availability of major plant items other than power transformers for emergency use, is managed through a Strategic Spares stock holding arrangement within the stores system. These spares include equipment such as switchgear, cables and fuses. The stock included in this system is held in a secure store that is separated from day to day regularly used stock Mobile Generators for Emergency Response (N-1 Conditions) ENERGEX has available a fleet of mobile standby generators that are used to provide emergency response to sub-transmission and distribution network faults that cannot be rectified by switching. This helps to limit interruption to supply in a manner that minimises customer inconvenience and improves reliability. This flexible use of generators provides a degree of N-1 support where existing network assets need to be supplemented. ENERGEX has expanded its mobile generator fleet significantly over the past three years to 21 MV.A of total capacity. ENERGEX has available a fleet of 37 low voltage generators ranging in size from 60 kv.a to 500 kv.a and four high voltage mobile 1.25 MV.A units. These HV generators are capable of being directly connected to either the underground or overhead 11 kv networks. In addition to its own equipment, ENERGEX hires low voltage generators to ensure there are enough generators for N-1 feeder support during extreme summer events. This is determined in August/September each year. In summer 2007/08, ENERGEX hired 5 MV.A of low voltage generators, with another 2 MV.A of generators leased to replace ENERGEX generators allocated for NDM deployment. The ENERGEX mobile units were deployed for load at risk areas during extreme temperature events during the summer period Mobile Generators for NDM Support (System Normal Conditions) In addition to the measures detailed in Section regarding the use of mobile generators and enhanced emergency response procedures to improve reliability of supply during extreme temperature events, ENERGEX negotiates network support agreements with customers who are located in network load at risk areas for summer preparedness each year. This initiative commenced during the summer preparedness planning in 2006/07 and is now into the third year of operation. Planning and identification of load at risk areas for 2008/09 summer preparedness has commenced and is expected to be finalised in July/August The amount of generation required for NCC load at risk areas is expected to be similar to that of the previous two summers shown in Table 34. These programs require commercial agreements with customers who have suitable load profiles that could be influenced on exceptional hot weather days. Initiatives include agreements with customers who have: Shiftable load; Private standby generation that can provide network support; or Have agreements allowing ENERGEX to locate generators onsite for network support. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 102

109 NDM Areas with NCC Load at Risk Total Required Support Total Supplied Support Customer Supplied Support ENERGEX Supplied Support 2006/07 14 customer sites 13 MV.A 16 MV.A 7 MV.A 9 MV.A 2007/08 12 customer sites 15 MV.A 17 MV.A 9 MV.A 8 MV.A Table 34 - Additional Support Required for NCC Load at Risk Sites ENERGEX has also provided embedded generation at a couple of locations to reduce peak load and defer network augmentation capital expenditure. This demand side strategy has been in place for several years and was conceived through ENERGEX s integrated resource planning process Emergency Response Procedures To ensure organisational readiness for a range of network emergencies, ENERGEX reviews and exercises its emergency response procedures on an annual basis and this is being done in advance of summer 2008/09. In addition to storm emergencies, the procedures cover responses to major network failures, generation and transmission deficiencies and unusual events such as extreme hot weather. ENERGEX has systems in place to allow a rapid response to most contingencies. When hot weather of at least 37 C is forecast, ENERGEX has procedures in place that instigate response planning in advance. The procedures are designed to ensure that operational staff are mobilised quickly in the field and that an appropriate structure is in place to manage any emergency. These procedures include management of communication with customers, executive management and stakeholders. As part of the response process, ENERGEX Control Centre has NDM support strategies for load at risk areas. At locations with limited network capacity, ENERGEX generators are deployed or arrangements are made with suitable large customers that can provide support generation or shed discretionary load during periods of network stress. A separate dispatch and operating protocol has been developed and tested for the Control Centre to initiate these arrangements Safety and Amenity The purpose of the plans set out below is to reduce electrical hazards associated with network assets that could impact on public safety and amenity Substation Security A program is under way to upgrade substation security; including fencing upgrades, installation of electric security fences and installation of swipe card access systems. There is also an education program for ENERGEX staff and contractors to ensure that substation gates and access doors to ground mounted plant are always secured whilst accessing and before departing these sites Cranes/Plant and Persons Operating Within Exclusion Zones ENERGEX is continuing with its look up and live safety awareness program, including the upgrading of warning signs in tidal marine zones. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 103

110 Wires Down Events To reduce the occurrence of wires down events in the ENERGEX overhead network, the following strategies have been adopted in addition to effective vegetation management that has reduced the frequency of trees and large branches falling on conductors: Design-out Initiatives: Construction standards are moving towards the elimination of timber crossarms for low voltage construction; and Primary 11 kv pole top construction now requires the use of an extended steel trident design that is modified to provide greater conductor clearances to prevent damage caused by flying foxes and other wildlife. Refurbishment/Replacement/Reliability Initiatives: High voltage feeders which have conductors rated below the prospective fault current are being progressively replaced as an integral part of capital projects (eg. new works or substation upgrades), or as an outcome of load flow/fault studies; Targeted and reactive installation of phase to phase spacers at 33 kv, 11 kv and low voltage to eliminate phase to phase clashing; A targeted program between 2004/05 and 2009/10 to replace approximately 500 kilometres of low voltage and 11 kv line constructed with 7/.064 copper conductor (EDSD recommendation); A targeted program to replace neutral screened low voltage services, to reduce the incidence of neutral related shocks to customers; A targeted program to replace ageing and open wire low voltage services, to reduce the incidence of neutral shocks to customers as well as wires down events in storms; A targeted program to replace ageing open wire low voltage mains with Aerial Bundled Conductor (ABC), to reduce the incidence of wires down events; and A targeted program to replace timber crossarms (LV, 11 kv and 33 kv) in 2008/09. Outcomes of the above strategies are monitored on a regular basis. Where appropriate, strategy reviews are conducted to seek a continuous reduction in the number of wires down events. ENERGEX is also currently developing a Community Safety Plan which sets out ENERGEX's strategies and initiatives to improve the safety of its network in relation to its customers. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 104

111 12.0 Appendices 12.1 Appendix 1 Network Basics Electricity for mass consumption is a commodity that is generated as and when it is required. To achieve this in Queensland, there are a number of generators, a single transmission distribution service provider (Powerlink) and two distribution network service providers (ENERGEX and Ergon Energy). Each of these entities owns and operates assets that are necessary links in the supply chain between generation and consumption. Some basic information about the relationships between these assets provides a useful background to assist in the interpretation of this management plan. Figure 40 has been extracted from the final report from the Queensland Government Independent Review of Electricity Distribution in Queensland entitled Electricity Distribution and Service Delivery for the 21 st Century (EDSD). Together with the following definitions, it illustrates the key elements of the electricity network in South East Queensland. Transmission Network: The electricity supply network operating at or above a nominal voltage of 110 kv. This term is used regardless of ownership. Connection Point (CP): (Ref. The Rules) The agreed point of supply established between ENERGEX s network and Powerlink, an embedded generator or a customer. Bulk Supply Point (BSP): A point (normally associated with a bulk supply substation) in the electricity supply network where supply is provided to the sub-transmission network. Bulk Supply Substation: A site incorporating equipment that provides control and voltage transformation from the transmission network to the sub-transmission network, regardless of ownership. Note: Sites that provide supply directly to customers at transmission voltage are normally listed with bulk supply substations. Sub-transmission Network: ENERGEX s electricity supply network operating and supplying zone substations or customer connection points at a nominal voltage of 110 kv and 33 kv. Zone Substation: A site incorporating equipment that provides control and voltage transformation from the sub-transmission or transmission network to the distribution network, regardless of ownership. Note: A site that provides supply to the sub-transmission and distribution networks incorporates both functions and is therefore both a bulk supply and a zone substation. Sites that provide supply directly to customers at sub-transmission voltage are normally listed with zone substations. Distribution Network: ENERGEX s electricity supply network operating and supplying distribution substations or customer connection points at 11 kv or, where so designated, 33 kv nominal voltage. Distribution Substation: An assemblage of equipment providing control and voltage transformation from the distribution network to the low voltage (415/240 V) network. ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 105

112 Figure 40 - Electricity Network Elements ENERGEX Network Management Plan 2008/09 to 2012/13, Final, 31 Aug 2008 Page 106