At what cost?

Report on outages points to NL Hydro failures, continued risk

Ashley Fitzpatrick
Published on April 25, 2014
Newfoundland and Labrador Hydro‘s thermal generation station in Holyrood. — File photo by Joe Gibbons/The Telegram

A team of consultants from Liberty Consulting Group has produced a report pointing to planning deficiencies, failed forecasts and deferred maintenance by Newfoundland and Labrador Hydro as contributors to Newfoundland’s power troubles in the winter of 2013 and 2014.

The Board of Commissioners of Public Utilities (PUB) hired Liberty to look at unplanned power outages and rolling blackouts, particularly from Jan. 2-8, and  provide an independent review of the readiness of the power system heading into the coming winter.

In a report released Thursday — a preliminary to a more in-depth report to come this fall — Liberty recommends as a first priority more power generators or generation capability be available on the island.

Without it, the consultant states, there is a standing and “unacceptably high risk” of further power outages on the island of Newfoundland until 2017, or whenever the Muskrat Falls hydroelectric development project comes on-line.

Meanwhile, Liberty dove into the so-called DarkNL power outages of 2014, raising questions about Hydro’s operations.

“One could argue that the events of 2014 were abnormal, exceptional, and maybe even unfortunate. Whether so or not, those attributes do not necessarily place such events outside of the range of outcomes for which a utility should plan,” the report states.

Aside from the availability of power generators large and small, the consultant challenged Hydro’s planning and maintenance work. “The number and nature of the failures that occurred within this compressed time frame (in January) is very unusual, and raises questions about Hydro’s operation and maintenance of equipment,” states the report.

“Liberty found that Hydro did not complete recommended maintenance activities on the equipment that failed, and that protective relay design issues and insufficient operator knowledge of the protective relay schemes existed. These circumstances contributed to the outages caused by the equipment failures.”

Hydro generally has a plan for its machinery, it indicates, but has often changed the plan, deferred scheduled repair and replacement work, and allowed backlogs.


The example of Sunnyside

The island’s power troubles in January 2014 began with cold temperatures and high peak loads, paired with some unavailable generators. However, the real challenges came with a transformer explosion and fire at the Sunnyside terminal station on Jan. 4 — something Liberty says could have been prevented.

In a detailed breakdown of events, the report steps through how the Sunnyside fire resulted in “a collapse of the transmission system and disconnection of the three Holyrood (power plant) generating units,” leading to a blackout for about 187,500 Newfoundland Power customers on the Avalon Peninsula.

The transformer failure at Sunnyside should not have had such an impact.

There is backup built into the system and the problem should have been isolated and largely unnoticed by the average homeowner. However, equipment malfunctioned. A breaker stuck.

That breaker was overdue for maintenance, scheduled once every six years. It was not checked, despite the added prompting of a recommendation to do so, emerging from a significant power outage in January 2013.

“Even had the 230kV breaker stuck, Hydro would have had the ability to clear the fault more quickly, had it provided a ‘breaker failure’ protective relay scheme,” the report notes. Hydro has the protection on some units.

However, “Hydro had determined, sometime in the past that the risk of a 230kV breaker malfunction’s occurring at the same time as a transformer fault presented too low a risk to justify the expense of installing a 230kV breaker failure schemes to mitigate such risk.”

As for why the big transformer blew up in the first place, the report notes an increased level of acetylene gas dissolved in the transformer’s oil. It is considered a measurable indicator of a coming transformer failure, given arcing inside the unit causes the change in the level of dissolved gas.

The gas level in the transformer had been elevated for years prior to the explosion in January 2014. “Hydro’s dissolved gas analysis reports show that the level of acetylene gas increased from seven parts per million (ppm) in March of 2012 to 11 ppm, in September of 2013,” Liberty states. “Acetylene should comprise no more than 2 ppm in the oil of a transformer.”

Lab tests in September 2013 resulted in a recommendation of further investigation. The recommendation was not followed. In fact, the consultant states, Hydro deferred scheduled preventative maintenance and testing on the same transformer.

For its part, Hydro is still investigating the cause of the transformer failure.


Recommended response

After an early review of the Liberty report, Danny Dumaresque, an intervener in the PUB power review, said it supports criticisms launched at Hydro in recent years around the subject of system maintenance and readiness. “Hydro’s knuckles have been severely rapped publicly,” he said in an interview with The Telegram.

“The required, recommended maintenance was not done. The required, recommended planning was not done. And of course, without the required maintenance and planning, that’s a recipe for disaster, which is what happened.”

In addition to adding generation, Liberty has recommended Hydro “catch up” on overdue maintenance on critical transformers.

It has also recommended the utility create a detailed plan for making as many of its generators available in the best possible condition for the coming winter, stating it should be completed by June 15 and monthly updates issued on progress made.

Newfoundland and Labrador Hydro is in the midst of reviewing the consultant’s report. “We are committed to ensuring our provincial electricity system can reliability meet the needs of our customers now, in the short term, and after the commissioning of Muskrat Falls,” said Ed Martin, Hydro’s president and CEO in a preliminary response.

“We are putting the necessary steps in place to prevent customer disruptions of this magnitude in the future.”

He noted Hydro is expecting to spend roughly $160 million in upgrades to the system this year. The addition of a new power generator, to run as high as $119 million, will come at a cost atop those planned upgrades.

Natural Resources minister Derrick Dalley welcomed the findings, saying the province is committed to ensuring that the electricity system is reliable for the long-term. That includes completing a government-level review of system reliability. “This review will complement, rather than duplicate, the efforts of the Public Utilities Board,” he said in a statement.

Liberal Leader Dwight Ball said he believes the report ultimately points to poor planning.

“The PC Government created Nalcor, but has not provided the proper oversight to ensure reliability of our energy system. They have failed to be accountable to the people of the province and this report sheds light on those failures,” he said, in his own statement.