Asset Management Plan Analysis For The Dalles and John Day Dams A Case Study

Terry B. Armentrout
Business and Engineering Consulting
www.sixsigma4service.com

Introduction:

Focus, Innovation, and Implementation are the key concepts to apply to capital asset management. When an organization intends to become world class by following the techniques and methods of lean-six-sigma for service, the capital replacement program must follow the broader strategy. It is just not a simple calculating various measures of return on investment but instead an aligning the infrastructure with the world class service delivery. Focus sharply on the customer defined product specifications. Apply innovation to work process of delivering these products. Implement these improvements integrally with capital asset replacement.

Linear programming methods seek to achieve best results for a given product or service subject to a range of constraints. The objective function defines the product or service. Constraint functions define the limits of supporting and often competing parameters. The linear programming process is complex and tedious. In this analysis, we seek to mimic intuitively linear programming. Specifically, how do we achieve the greatest production from The Dalles and from John Day powerhouses with a substantial number of operating constraints?

We begin with a set of objective functions: Power production, transmission support, and 100% market availability. Power production has several components. Energy, total megawatt-hours, revenue optimization, realizing the time value to energy production, and capacity, the ability to produce should equipment fail elsewhere in the Federal Columbia River Power System (FCRPS), all have economic value. A major portion of energy sales is now out of the Northwest region. Energy moving south, across the North-South Intertie, is a major revenue stream. Transmission support from The Dalles and from John Day has high value. The deregulated electrical utility market presents greater opportunity. Being able to participate dynamically in the deregulated market will provide opportunities to Bonneville Power Administration (BPA) for greater revenue and value to the Northwest Region. Making generation assets flexible to react to the market fluctuations will have significant positive impact on revenue. The Dalles and John Day is the greatest portion of those flexible Corps of Engineer assets. 100% market availability of those assets has substantial economic value.

The constraints are the water supply, operational capabilities, and the need to maintain the resources. Nature fixes the water supply toward the end of spring and the beginning of summer. What nature delivers is what the FCRPS has to work with. By late spring, the region has worked out the requirements for fish passage and irrigation withdrawals. The water nature delivers minus the water allocated for other use is the firm and the total supply. However, the system has some capability to shape the timing of the flow. This timing is an operational parameter available to manipulate in optimizing the energy production revenue function.

The system will grind to a halt without maintenance of the asset. Since 1938, the FCRPS has worked with the assumption it is necessary to take equipment out of service for maintenance. A further assumption making maintenance costs minimum results in optimum revenue. We need to challenge both assumptions. We need to apply innovation to breach these assumptions. Beyond maintenance of revenue producing assets, the infrastructure needs some replacement and modernization.

We know the objective functions and we have a reasonable concept of the restraints. Now our task is to move toward the greatest possible revenue. We have three tools: capital improvements, operational improvements, and maintenance process improvements.

Capital Improvements:

Enhancing the Power Marketing Position

Simple Pareto analysis of the Generator Availability Data System indicates where disruptions to service occur.

Obviously, capital equipment related failures cause the most failures by at least an order of magnitude. At the foundation of those failures are: poor engineering such as inadequately considered rehabilitation reports, poorly engineered digital three dimensional Kaplan blade-load cams, poorly written specifications for thrust bearing refurbishment, and fifty years of service on equipment with a thirty year expected life span. The prudent course is to attack the root cause of this problem by replacing the fundamentally flawed engineering processes. The prudent course is to concentrate on intelligent market connected recapitalization.

Intelligent Market Connected Recapitalization

Recapitalization coupled with thorough consideration of market opportunities will deliver service. The broader view is to make infrastructures improvements in relation to the Federal Columbia River Power System ability to deliver service within the Pacific Northwest and its ability to interact with adjacent markets.

The Dalles and John Day Powerhouses are the northern anchors to the Pacific Northwest – Southern California system intertie transmission lines. This translates into generator windings, main unit circuit breakers, transformers, Automatic Generation Control, fast acting governor systems, ancillary product capabilities, and robust Data Acquisition and Control Systems.

100% Market Availability

100% market availability means all the revenue producing and service providing assets are available when the market has demand for them. The traditional thoughts of removing assets from service for extended periods need examination. Recapitalization programs must focus on transforming maintenance from the central dominant role to the market availability role. Technological advances will allow new equipment to include features of perpetual self-monitoring and self- diagnosis. Communication links from generating components to maintenance control is an integral feature to this advanced system. Maintenance must transform from a predetermined schedule to flexible effort when work is necessary and no demand exists for the asset. Additionally, the non-value added work of routine inspection and diagnosis can become an economic deployment of maintenance capability. Given this new self-scrutiny role and the advantages it provides to market satisfaction, the recapitalization question becomes what strategic advantage does new equipment offer. The old questions of equipment resilience become moot.

Operational Improvements:

Understanding the market, dynamic response to the market, and use of probabilistic generation models essential to achieving a lean six-sigma organization that can successfully supply 100% market availability.

Understanding the market

The market is no longer generating electrical power and people will purchase it. Now the market has segmented elements of generation, transmission, distribution, and system operation. The market now includes reserve, spinning reserve, green energy, electrical energy, high load hours, low load hours, reactive support products, and time dependant reactive support. In the old industry model, only energy traders needed any understanding of these products. Now all employees in the lean and efficient organization need in depth understanding of these products. They need to understand how their daily activity affects the organization’s ability to participate.

The Probabilistic Generation Model

Sixty years of measured water flow is the data source for this model. The model then applies the present flow constraints and water budget to the data. It separates the probability of generation into quartiles of probabilities. Below is the model for The Dalles:

The advantage of this model is exploiting the opportunities. Nature is variable. However once the winter climate deposits raw energy assets in the Canadian Rocky Mountains and in the Yellow Stone – Grand Teton ranges the energy possibilities become more known and narrow. Now the task can be optimizing the product delivery.

Maintenance Process Improvements:

Maintenance delivers no products to the market. The focus of maintenance is the achievement of 100% market available assets. The key is to remove non-value added process. The strategy is to be very flexible. Optimization of the maintenance effort does not lead to optimization of product delivery. A prime example of non-value added process is the mobilization and demobilization required for turbine cavitation repair. Getting to the turbine requires two weeks of removing fish from the draft tube, and installation of specialized scaffolding. Workers have a similar effort preparing the turbine for operation. This huge effort is necessary just to inspect the turbine blades for cavitation damage. Perhaps repair is not necessary. A more efficient alternative is to inspect the turbine blades with either a human diver or a remotely controlled submersible camera. This inspection requires less than a day and does not require moving fish from the draft tube. A remotely controlled submersible camera inspection removes almost a month of non-value added work. This alternative also increases the flexibility in applying the maintenance effort. Similar alternatives exist in all aspects of powerhouse maintenance.

No natural law requires maintenance needs to be linear. In a flexible maintenance system supporting 100% market availability, the best strategy is disconnecting maintenance activities into multiple small jobs rather than on large job. Smaller maintenance jobs can more easily fit market opportunities yet supply the necessary adjustment and repair. Optimizing the maintenance effort sub optimizes market availability.

Maintenance Durables

Maintenance is a small job shop activity; all the methods of that technology apply. Tools are the means by which workers eliminate non-value added work. Remote submersible cameras replace labor-intensive scaffold installation. More effective and efficient tools require more skilled maintenance staff. Skilled people capable of driving improvement and armed with effective and efficient tools can produce maintenance flexibility, which supports 100% market availability.

Summary

Focus on supplying the market 100% of the time when demand exists. Use innovation to make strategic and supporting capital improvements, operational improvements, and maintenance process improvements. Implementation of these strategies will produce a world class, lean six-sigma organization.