This editorial is brought to you by Newfoundland and Labrador Hydro, which made the following points about the province’s electrical system to the province’s Public Utilities Board in a capital budget filed July 14, 2006.
More than seven and a half years later, all of the aging components named in the document are still in operation, and three — the Hardwoods and Stephenville gas turbine plants and the Holyrood generating plant — suffered failures leading to the current rolling blackouts.
“The predecessor to Hydro (the Newfoundland Power Commission) was incorporated in 1954 and its primary purpose at the time was to electrify the province. The ’50s and ’60s saw a tremendous growth of Hydro in terms of expansion of its assets. The result of this expansion is that the majority of Hydro’s most important assets are about 40 years old. This is true of Hydro’s largest hydro installation at Bay d’Espoir, its Holyrood Thermal Generating Station and much of its transmission and distribution systems.
“Many of the capital proposals contained in this and previous capital budget applications resulted from the age of Hydro’s assets. Many of the components of Hydro’s infrastructure have reached the end of their useful lives and have required replacement. The quantity as well as the dollar value of these routine sustaining capital proposals can also be expected to increase in future for the following reasons: the age of plant components are increasing; and replacement parts are becoming unavailable as manufacturers declare equipment and components obsolete and withdraw support.
“The Holyrood Generating Station stage 1 (Units 1 and 2) is now 37 years old while stage 2 (Unit 3) is 26 years old. The generally accepted life expectancy for thermal plants is 30 years. Hydro’s two largest gas turbine plants, Hardwoods and Stephenville, are now 30 years old. The generally accepted life expectancy for gas turbine plants is between 25 and 30 years. These three plants have required considerably more maintenance in recent years and all three have required significant capital expenditures to maintain a reasonable level of reliability and availability. This application contains proposals for projects such as fuel piping replacement, controls replacement and turbine/generator component replacement, all necessary to ensure continued reliable operation.
“The Holyrood Thermal Generating Station, and the Hardwoods and Stephenville gas turbine plants are approaching the ends of their conventional operating lives; therefore, this capital budget application contains proposals for major assessments of these three generating stations. The information obtained from these assessments will enable Hydro to make informed decisions about longer-term operating and development plans for these facilities.
“The assessment of the Holyrood Thermal Generating Station will provide essential information as to the condition of the assets and the availability of replacement parts and technical support as well as the feasibility of converting the plant to burn natural gas and of the installation of scrubbers and precipitators to effect lower environmental emissions. This information will be combined with due consideration for the needs of Hydro’s customers, and of the pressures of escalating fuel prices and changing environmental standards.”
Talk is cheap.