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Costs of coal plant construction cut with digital automation architecture

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INTEGRATING digital bus technology into the design of new coal-fired power plants can result in a total project cost reduction of as much as US$20 million for a 600 MW coal-fired plant, according to a new plant construction study released at the recent POWER-GEN International conference in the US.

The independent study was carried out by Minnesota-based consulting firm JDI Contracts on behalf of Emerson.

“PlantWeb, Emerson’s digital plant architecture, has proven to save 30 percent or more in installed automation costs,” said Ann Pauley, president of the power and water solutions industry centre of Emerson Process Management . “We were confident that the digital approach would deliver major cost reductions for construction of coal-fired power plants. We determined that contracting a rigorous, quantified third-party study based on engineering and construction practices was a viable, unbiased method of demonstrating the possibilities,” she added.

The Economic Impact of Digital Bus Technology on New Plant Construction identified and compared five categories of costs: engineering, construction, start-up, system selection and overheads.

These costs were applied to two different approaches - traditional and digital bus-based - to instrumentation and control (I&C) system implementation for a US$840 million greenfield 600 MW pulverised coal-fired supercritical power plant.

According to the study, utilisation of digital I/O bus technology can slash up to US$20 million - or 2.35 percent - off the entire project budget.

“This study details a methodology that gives stakeholders in the utility industry the best of both worlds: the ability to save millions of dollars in construction costs while also delivering a highly automated plant featuring state-of-the-art I&C systems,” said Roger Hoyum, author of the study.

The traditional approach used an engineer-procure-construct (EPC) model and selected an I&C system through an evaluated bid process. The installation utilised dedicated field cables to hardwire non-intelligent field devices to I/O cards.

The digital bus approach, which used an alternative selection process - PEPC (procure strategic suppliers, engineer, procure balance of plant and construct) - featured an integrated system of high-speed communications networks, intelligent field devices and bus I/O technologies. The digital bus approach also used traditional I/O for certain high-speed and safety-related loops.

Defining the study

THE plant and remote buildings were physically defined by plan, elevation and several general arrangement (GA) drawings. Researchers estimated the engineering time for typical design tasks for both approaches.

The plant was logically defined by an existing plant specification with roughly 5,200 hard and 4,250 soft I/O partitioned into typical power plant system designations. Appropriate systems were placed on GA drawings to complete the physical plant definition.

Next, researchers placed control system cabinets and motor control centres (MCC) on GA drawings. Design criteria were developed for both approaches, including construction labour costs, tray conduit and cable lengths, and material costs.

Individual design parameters were assigned to all I/O points in the study to complete the construction estimate. Device upgrade costs from smart transmitters, digital I/O and intelligent motor interfaces were estimated for the digital installation. Plant checkout and start-up tasks were defined for each I/O type, as well.

A plant construction schedule and budget was created to estimate a total spending curve. From this, researchers developed a construction financing methodology to estimate interest during construction (IDC), which is the cost to borrow money to build the facility. Inflationary escalation was estimated based on typical utility accounting methods.

Fixed overhead costs were assigned to all construction and start-up line items, and included administrative and general support, construction management, contingency, contractor indirect charges, freight, project management, spares and sales tax. Variable overheads included inflation escalation and IDC at a rate of three percent and six percent, respectively, both compounded calculations.

Adding value, cutting costs

RESEARCHERS determined that the digital bus approach to new plant construction provided opportunities for reduced costs in all areas studied.

Items considered for engineering, construction, start-up, system selection and overhead costs for a traditional I&C system totalled approximately US$50.1 million, compared with US$30.4 million for the digital I/O bus approach, resulting in a savings of more than US$19 million (39.4 percent), or US$2,000 per I/O point.

The breakdown of these savings appears below:

Engineering. Early adoption of digital bus technology simplified the engineering process, resulting in savings of approximately US$3.5 million. For example, the study indicated that engineering time is reduced with the digital I/O bus approach due to use of standard templates and objects, the need for fewer drawing review cycles and less system complexity. Less complexity, in turn, allows for higher I/O density on drawings, which then reduces the number of drawings needed.

Construction. The cost of construction takes into account both the material cost of the I&C equipment and the cost of the labour required to perform the installation. The study demonstrated that utilisation of digital bus technology resulted in US$3.6 million in savings, primarily a result of reduced labour and material costs needed to install tray, cable, conduit, terminations and I/O cards.

Start-up. Because of the reduced complexity of the digital bus installation, the time required for checkout and start-up can be significantly reduced, resulting in savings of nearly US$426,000. “If the checkout process can be shortened it will save time and money in staffing,” explained Hoyum. “But, even more importantly, reducing the time spent on the critical path to unit synchronisation leads to much more significant savings in IDC.”

System selection. Early standardisation on digital I/O bus technology streamlined the traditional specification and bid process. It also created other efficiencies, such as reducing the amount of general engineering support needed for overall plant construction. In total, savings of approximately US$300,000 were achieved.

Overheads. Finally, the study demonstrated how digital bus technology can have a huge impact on fixed and variable overhead costs, resulting in savings of roughly US$11.9 million. This is primarily reflected in reduced IDC costs made possible by significantly reducing checkout and firing time. In this study, the use of digital I/O bus technology could cut two months or more off a six-month checkout and up to one month from a three-month start-up period. “IDC begins at the start of construction and continues to be charged against construction until commercial operation begins,” said Hoyum. “So, it’s easy to see how saving three months of IDC can play a huge role in reducing overhead costs.”

Article reproduced with permission from Engineer Live. www.engineerlive.com

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