ElectraNet proposes the replacement of 56 sets current transformers at eight substations.

This Regulatory Investment Test for Transmission (RIT-T) Project Specification Consultation Report (PSCR) identifies the need to replace 56 sets of current transformers at eight substations as the preferred solution to manage the risk that these assets will fail.

Current transformers are a major component of the electrical protection system that ensure electrical faults are cleared within designated times as specified in the National Electricity Rules (NER)[1]. If a current transformer fails, depending on the nature of the failure it can cause unpredictable damage resulting in harm to people, substation failure and involuntary load curtailment for customers.

Based on the recent failures of current transformers, we have commenced replacement of the higher risk current transformers located at Torrens Island Power Station B to manage the risk that these assets will fail.

The ‘identified need’ is to efficiently manage the risk of asset failure.

Current transformers are critical to the operation of protection systems, which in turn are critical to the safe, reliable and secure operation of the transmission system.

We have classified this RIT-T as a ‘market benefits’ driven RIT-T as it is being progressed to manage the risk of asset failure and thereby deliver positive net benefits to customers.

Two credible network options.

Our analysis has identified that there are two technically credible network options.

Option 1, to replace the 56 sets of current transformers at eight substations by 2026 that are at high risk of failure.

The estimated capital cost of this option is approximately $30.2 million with no increase to routine maintenance.

Option 2, leaving the current transformers in service and increasing the testing regime with a view to replacing current transformers based on those test results. Under this option we expect that unplanned current transformer failures will continue to occur but at reduced rate compared to the base case of replacement upon failure.

The estimated capital cost of this option is approximately $30.2 million and there will be an increase in routine maintenance of approximately $275,000 per year until all the identified current transformers are replaced.

A full cost benefit assessment has been undertaken, comparing the risk cost reduction benefits of the two options against the base case ‘do nothing’ option.

The estimated cost of both options is below the threshold requiring ElectraNet to complete a Project Assessment Draft Report (PADR) under NER clause 5.16.4(z1). This RIT-T is therefore exempt from the need to produce a PADR.

There is no feasible role for non-network options in addressing the identified need for this RIT-T

ElectraNet does not consider that a non-network option can meet the identified need for this RIT-T. This is due to the specific role that current transformers play in the transmission of electricity and their relatively low replacement cost.

Nevertheless, for completeness and consistent with the requirements of the RIT-T this PSCR sets out the technical characteristics a non-network option would need to have.

Three different ‘scenarios’ have been modelled

We have developed three reasonable scenarios for the economic assessment as detailed below:

• a ‘central’ scenario reflecting our base case set of key assumptions;
• a ‘low benefits’ scenario – reflecting a pessimistic set of assumptions, which represents a lower bound on potential market benefits that could be realised; and
• a ‘high benefits’ scenario – reflecting an optimistic set of assumptions, which represents an upper bound on potential market benefits that could be realised.

Option 1, replacing the identified current transformers at 8 substations by 2026 is the preferred option

The preferred option for addressing the identified need in this assessment is Option 1, which is to replace 56 sets of current transformers at eight substations by 2026.

Most of the expected benefits are derived from the avoided risk, and consequences, of current transformer failure. These are primarily comprised of avoided expected outages.

When the analysis is weighted across the three scenarios investigated, the preferred option is expected to deliver approximately $22.0 million in net market benefits.

We have also undertaken a thorough sensitivity testing exercise to understand the robustness of the RIT-T assessment to underlying assumptions about each of the key variables.

In particular, we have tested the optimal timing and the sensitivity of this timing to key variables. Under most sensitivities investigated, we find it optimal for the preferred option to be undertaken as soon as possible and the estimated net market benefits to be robust.