The operating efficiency of an organization can be measured in many ways. A number of aspects can be considered in evaluating the operating efficiency. Common categories of operating efficiency that are related to operational practices include; fuel acquisition efficiency, plant operating efficiency and capital efficiency.
Fuel acquisition is a significant aspect in determining the marginal and variable costs of power/water cogeneration plants. Since fuel acquisition practices are fully under the control of utility management changes, fuel procurement practices affect plant operating efficiencies. Fuel is the largest component of variable power production costs. The generating company uses natural gas as the primary fuel that drives the gas turbine cycle. Fuel acquisition for the generating company is quite simplified since the natural gas comes from a government owned organization. Therefore, fuel acquisition is guaranteed in the current business model of the
generating company. Since capital efficiency is outside the scope of this paper, the remaining discussions are focused on plant operating efficiency.
Although there are many ways of defining plant operating efficiencies, the discussions in this paper will revolve around operating practices that affect a number of aspects that define plant operating efficiency. Such aspects include: non-fuel variable costs, non-fuel operating costs, and maintenance costs. In the following analysis, data on the aspects mentioned above were collected from the generating company for analysis. The approach used in the analysis was to develop estimates of efficiency frontier references for key measures of the various aspects that define plant operating efficiencies. The potential improvements were then evaluated by comparing actual plant operating data against the reference data. The key statistics for the concepts under study were ordered into quartiles. The mean value of the “best practices” quartile for each key statistic was then calculated and used as the “efficiency frontier reference” for the sake of comparison. Potential savings were then estimated using actual plant statistic deviations from the frontier references.