Operation Thekgo - Principals Driving Total System Reliability & Capacity AMUE Convention 16 October...

Operation Thekgo - Principals Driving Operation Thekgo - Principals Driving Total System Reliability & CapacityTotal System Reliability & Capacity

AMUE Convention

16 October 2007

Greg Tosen

Operation Thekgo

2

Contents

• Key Demand & Supply Side Challenges facing South Africa

• Total System Capacity & Reliability (TSC&R) – the Thekgo Approach

• TSC&R Journey (last 18 months)

– Emergency Preparedness

– Short-term Reliability

– Reliability Enhancement & Role out

• Conclusions

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South African Electricity Situation

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Electricity Demand and Supply – key challenges

• South Africa has reached the end of its surplus generation capacity

• 1st challenge: Avoiding mismatch between demand and supply

– Excess capacity - stranded resources

– Capacity shortage - constrained economic growth

• 2nd challenge: Correct choice of capacity to be constructed from an array of available options that differ dramatically in terms of:

– Cost (construction and operating)

– Lead time to construction

– Environmental impact

– Operating characteristics

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National + Foreign long term forecasts plus Position line

30000

40000

50000

60000

70000

80000

90000

100000

110000

120000

130000

2005 2010 2015 2020 2025

MW

Electricity growth - 6%

Position - 4%

High forecast - 3.2%

Moderate forecast - 2.3%

Long Term Demand forecast

Eskom position based on 4% electricity growth

supporting 6% economic growth

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Diversify Primary Energy Mix

Coal OCGT

Nuclear Renewable Energy

Imports Pumped Storage

Existing Mix by 2025

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Total System Capacity & Reliability Action Centre Mandate

The action centre will:

• Co-ordinate and integrate total system capacity and reliability of the business over the next 36 months

– Oversight of the overall capacity and reliability targets

Develop the targets

Develop RACIs addressing Action Centre and Line

– Oversight over all processes across the value chain to ensure the achievement of targeted capacity and reliability

– Identify, mitigate risks and implement contingencies

– Be the integration point across the value chain to ensure total systems capacity and reliability

– Implement measures across all areas of the business to address the long term capacity requirements and reliability of the total system

– Address all people, culture and stakeholder management issues pertaining to capacity and reliability

– Ensure focus across the organisation on reliability and capacity as fundamental priorities.

– Align existing initiatives and optimise resources and effort

• Implement a robust emergency response process

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VulnerabilityAdaptive

Capacity

Reduction Readiness Response Recovery

System adaptive capacity

System vulnerability

time

KPI

Shock

Resilient Organisation

•Ability to rebound•Ability to recover easily & quickly from adversity

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Key Initiatives and Objectives – 36 months

• Ensure required level of total system capacity and reliability for the next 36 months.

• Immediate focus on Western Cape & Eastern

• Implement an interim and end-state emergency response process including a command centre

• Enhance and Institutionalise Eskom’s current reliability management Framework.

• Feedback Learning from the Short Term initiatives into the existing business and long term initiatives

• Reliability and capacity is positioned as a top business priority

• Operation Thekgo is effectively positioned.

• Ensure consistent and proactive communication with all stakeholders regarding capacity and reliability.

• A robust and reliability culture supported by the correct HR processes, quality and quantity of skills.

Short Term Reliability

Emergency Response Command Centre

Reliability Enhancement

Stakeholder & Communications

Culture and Change

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The TSC&R Journey for the next 36 months

Phase 2: Operationalisation Phase 3: Instituitionalisation

Dec 2006Dec 2006 June 2007June 2007 Dec 2007Dec 2007 June 2008June 2008 Dec 2008Dec 2008

Eskom’s Journey in the next 36 months

Summer2006

Summer2006

Winter2007

Winter2007

Summer2007

Summer2007

Winter2008

Winter2008

Summer2008

Summer2008

June 2006June 2006

Winter2006

Winter2006

Establish Emergency Response

Command Centre


Command Centre

Early Warning Monitoring and Response


Aug 2006Aug 2006

Create and ValidateReliability Enhancement

Strategy

Winter and Summer AssessmentsWinter and Summer Assessments

Readiness Action PlansReadiness Action Plans

Reliability Readiness Audit


Short Term Reliability Initiatives

Continuous ImprovementImplement Strategy

- Background and Information

EstablishInterim

EmergencyResponse

End StateDesign & Implement

May2007

and 5 yr plan

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Imperatives for Establishing the Emergency Response Command Centre

Integrated Emergency Response

StrategicManagement

of Stakeholders

Strategic and Tactical Emergency Response

• Create a central co-ordination point that can respond to any event in an integrated manner

• Reduce duplicated effort and drive alignment

• Focus will mostly be on events or issues with an Eskom-wide or multiple division impact

• Create a central co-ordination point that can respond to any event in an integrated manner

• Reduce duplicated effort and drive alignment

• Focus will mostly be on events or issues with an Eskom-wide or multiple division impact

• Focus on communications between divisions and regions in an integrated manner

• Foster consistency in communication of messages to stakeholder groups in an

emergency situation

• Focus on communications between divisions and regions in an integrated manner

• Foster consistency in communication of messages to stakeholder groups in an

emergency situation

• Leadership driven response to emergencies

• Strategic responses to emergencies, aligned with divisional operational response plans

• Leadership driven response to emergencies

• Strategic responses to emergencies, aligned with divisional operational response plans

Addressing the Addressing the need to react differentlyneed to react differently to an emergency from an Eskom national perspective to an emergency from an Eskom national perspective

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Gx (where applicable)

Gx (where applicable)

TxTx

DxDx

KSACsKSACs

Other Divisions as requiredOther Divisions as required

ERCC Operating Model – Regional Joint Command Centres (RJCC)

ERCCMegawatt Park

ERCCMegawatt Park

Eastern RJCC

Mkondeni

Eastern RJCC

Mkondeni

North East RJCC

Witbank/Nelspruit

North East RJCC

Witbank/Nelspruit

Northern RJCC

Pretoria/Polokwane

Northern RJCC

Pretoria/Polokwane

Central RJCC

Simmerpan

Central RJCC

Simmerpan

North West RJCC

Bloemfont.

North West RJCC

Bloemfont.

Western RJCC

Bellville

Western RJCC

Bellville

Southern RJCCEast

London

Southern RJCCEast

London

NATIONALNATIONALCONTROLCONTROLCENTRECENTRE

NATIONALNATIONALCONTROLCONTROLCENTRECENTRE

NationalNationalEmergencyEmergency

CentresCentres

NationalNationalEmergencyEmergency

CentresCentres

Gx JOC

Tx JOC

Dx JOC

KSACs

Other

Gx JOC

Tx JOC

Dx JOC

KSACs

Other

Gx JOC

Tx JOC

Dx JOC

KSACs

Other

Gx JOC

Tx JOC

Dx JOC

KSACs

Other

Tx JOC

Dx JOC

KSACs

Other

Gx JOC

Tx JOC

Dx JOC

KSACs

Other

Tx JOC

Dx JOC

KSACs

Other

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Emergency Response Protocols

Further ActionsFurther Actions

MobiliseRecovery Team


Status ReportingStatus Reporting

Emergency Response ProtocolsEmergency Response Protocols

Determine Initial Response


Event Trigger

ActivationActivation

Convene Initial Response Team


Plan ActionsPlan Actions

Stand Down

Assess SituationAssess

Situation

Develop Strategic Options & Priorities


Further ActionsFurther Actions



Status ReportingStatus Reporting

Emergency Response ProtocolsEmergency Response Protocols


Determine Initial Response Team

Event Trigger

ActivationActivation



Plan ActionsPlan Actions

Stand Down

Info Request

Assess SituationAssess

Situation



Communications and Stakeholder Management

Alert

Nw

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The TSC&R Journey for the next 36 months

Phase 2: Operationalisation Phase 3: Instituitionalisation

Dec 2006Dec 2006 June 2007June 2007 Dec 2007Dec 2007 June 2008June 2008 Dec 2008Dec 2008

Eskom’s Journey in the next 36 months

Summer2006

Summer2006

Winter2007

Winter2007

Summer2007

Summer2007

Winter2008

Winter2008

Summer2008

Summer2008

June 2006June 2006

Winter2006

Winter2006


Command Centre


Command Centre



Aug 2006Aug 2006

Create and ValidateReliability Enhancement

Strategy

Winter and Summer AssessmentsWinter and Summer Assessments

Readiness Action PlansReadiness Action Plans



Short Term Reliability Initiatives

Continuous ImprovementImplement Strategy

EstablishInterim

EmergencyResponse

End StateDesign & Implement

May2007

and medium-term outlook

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Short-term Reliability

• Ensure required total system capacity and reliability for next 5 yrs Ensure proper alignment

and coordination of all capacity and reliability related initiatives across all functions and

areas within Eskom

• Establish reliability assessment and reliability readiness

Equip the organisation to live with an increase of power system risk

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Short Term Reliability – Approach

Enhance the preparedness of Eskom to address total system reliability for

key periods

AssessEffectiveness

Action Solution

Identify

Reliability Risk Assessments

Ongoing Coordination of Reliability Initiatives


18 month plan

5 yr plan

Regional Reliability Teams

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key periods

AssessEffectiveness

Action Solution

Identify




18 month plan

5 yr plan

Regional Reliability TeamsRisks

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Key Power System RisksRisk Comment

Extended Outage of a large coal fired thermal unit or of a nuclear unit (600 to 900 MW) impacting on stock pile levels, creating capacity shortages (needing extended use of demand side resources) and increased vulnerability to large scale interruptions based on location of generation (as transmission corridors become heavily loaded)

•While there have been a number of short duration generator outages, there has been no extended outage of any of the large units

Outages of one or two lines and/or transformers in major transmission corridors resulting in large scale interruptions and possible rolling load shedding if recovery times are long

•No major transmission risks have materialised.

•The risk remains unchanged

Operation of special protection systems are not effective leading to cascading outages and increased vulnerability to large scale interruptions and blackout.

•No incidents have occurred

•The risk remains unchanged

Dramatic reduction in coal stockpiles resulting in units having to shut down. Vulnerability has increased to this risk due to the low level of stockpiles currently.

•Stockpile risks

•The risk still remains

Unavailability of liquid fuel for open cycle gas turbines •Risk remains unchanged

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Confidence levels (2005-2006 data)

Daily UCLF and (UCLF+OCLF) Cumulative Distribution (April 2005 - February 2007)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

UCLF or UCLF+OCLF (%)

Pro

ba

bilit

y

UCLF

UCLF+OCLF

2000MW1500MW

NOTE: 36428 MW installed base

Confidence level 90%

(37 days at risk) 95%

(19 days at risk) 98%

(8 days at risk) Unplanned Allowance

1500 MW 2000 MW 2500 MW

1900 MW O.R.

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key periods

AssessEffectiveness

Action Solution

Identify




18 month plan

5 yr plan


Plans

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18 Month Rolling Plan – Approach & Classification

Summer ’06Oct ’06 to Mar ‘07


Winter ’07Apr ’07 to Sep ‘07Winter ’07

Apr ’07 to Sep ‘07Summer ’08Oct ’07 to Mar ‘08


18 Month Rolling PlanUpdated every 6 months

6 Month Rolling PlanBi-Monthly

Approach PhilosophyApproach Philosophy

• Assessing the vulnerability to the organisation from an integrated perspective.

• Plan is developed using divisional input for compiling the vulnerability, and assessing the system adaptive capacity.

• Assessing the vulnerability to the organisation from an integrated perspective.

• Plan is developed using divisional input for compiling the vulnerability, and assessing the system adaptive capacity.

• Green– If the Actual Supply (AS) is greater than the Required

Supply (RS) and meets the 1900 MW reserve.

• Yellow– If the Actual Supply (AS) is greater than the Required

Supply (RS) and the deficit is less than 1000MW.

– Probably use of Contracted DMP resources and EL1.

• Orange– If Actual Supply (AS) deficit to RS is between 1000 MW

and 2000 MW.

– Probably use Interruptible loads.

Classification System• Red

– If Actual Supply (AS) deficit to RS is between 2000 MW and 3000 MW.

– Probably use interruptible loads and have some mandatory load shedding.

• Brown– If the Actual Supply (AS) deficit to RS is more than

3000MW.

– Probably have rotating mandatory load shedding

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Capacity Adequacy – Winter 2007

Date Week Forecast Available Capacity Less OR and UA Surplus / Deficit

04-Jun-07 22 36844 37390 33590 -3254

11-Jun-07 23 36972 37300 33500 -3472

18-Jun-07 24 37043 37881 34081 -2962

25-Jun-07 25 36386 38489 34689 -1697

02-Jul-07 26 36461 38506 34706 -1755

09-Jul-07 27 36736 39008 35208 -1528

16-Jul-07 28 36319 38583 34783 -1536

23-Jul-07 29 35823 38853 35053 -770

30-Jul-07 30 35211 37485 33685 -1526

06-Aug-07 31 34579 36660 32860 -1719

13-Aug-07 32 34540 36960 33160 -1380

20-Aug-07 33 34255 36309 32509 -1746

27-Aug-07 34 34068 35852 32052 -2016

03-Sep-07 35 34917 36397 32597 -2320

10-Sep-07 36 33443 35612 31812 -1631

17-Sep-07 37 33951 35612 31812 -2139

24-Sep-07 38 32982 34829 31029 -1953

Ver 5

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key periods

AssessEffectiveness

Action Solution

Identify




18 month plan

5 yr plan


Teams

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Reliability Risk Team Structure (R.A.C.I.)

Integrated Reliability

Risk Forum

ExcoSoS

Exco

ThekgoActionCentre

CTAD

Regional Reliability

Teams

Implementation of Reliability Risk Mitigations and

Actions(Accountable)

Custodians of Reliability Risk(Responsible)

Guidance re Mitigation &

Implementation Support(Inform)

Auditing of Action Implementation &

Mitigation Effectiveness

(Consult)

Custodian of Overall Reliability

Risk Process(Responsible)

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Approach to Addressing the Reliability Situation in the Regions

Network Strengthening


Load ReductionInitiatives


IntegratedCustomer Mgt


Stakeholder Management


IntegratedReliability Risk Mgt


EmergencyPreparedness


Skills & ResourcesSkills & Resources

Operation ThekgoOperation Thekgo

Reliability Team PMO


• Assessing overall reliability risks in an integrated approach for the region

• Managing and controlling the activities of the resilience team

• Risk, issue and deliverable management

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Region Risks

Unifirm Substations Single Contingency lines

R Load is shed after the loss of a single transformer.

OMomentary load shedding is required after the loss of a transformer but all load is restored after remedial actions have been implemented.

G No load shedding is required after the loss of a single transformer.

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DSM Role out

Customer Service

Board of Directors

Quality Assurance

Research & Development

ESSENTIAL SUPPORT FUNCTIONS TO ALL OF THE ABOVE

PersonnelPersonnelPersonnel

$

MICROSOFTCORPORATION

Finance

TariffsBuilding stdsAppliancelabeling

OR STICK

Warehouse

Comprehensive National Comprehensive National Demand Management Demand Management

ProgrammeProgramme

Virtual Power Station

Increased Demand Side Management target of 3000MW by 2012

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Conclusions

• The system remains extremely tight from a capacity point of view for the months and years ahead

– Probability of load shedding is relatively high largely due to unexpected performance changes in generation or transmission plant.

– Relief only when several new coal fired units are built and reserve margin goes over 15% (2011 to 2013)

• Focus is required on current system, as well as new build programs

– Integration of new projects is going to put the network under stress and close cooperation required between all divisions

.

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Integration between these elements is key for Eskom to handle their current and future challenges.

Planning Security of Supply Risk Management

Emergency Response

Event

Emergency response plan

Activ

ity

Crisis management/ communication plan

Businessrecovery plan

Time objective

Roadmap to RecoveryTM

Stage 1Stage 2

Stage 3

ER Protocol Recovery strategiesStakeholder

management / Comms

• Daily plan• Weekly Plan• Monthly Plan• 18 Month Plan• 5 Year Plan• 15 Year Plan

Life of Plant

Supply

Demand Risk / Shortfall

Probability of Risk

Thekgo value

Thank YouThank You

Operation Thekgo - Principals Driving Total System Reliability & Capacity AMUE Convention 16 October...

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